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Press Release

Ombudsman Will Penalise Customers

26 February 2009

Customers will be the ultimate losers from an expensive and unnecessary supermarket ombudsman, said the British Retail Consortium (BRC).

Reacting to the Competition Commission's announcement, today (Thursday), that it will start consulting on the creation of an ombudsman and is to extend the existing Groceries Supply Code of Practice, the BRC said the expanded code is a further reason why an ombudsman is not needed.

Stephen Robertson, British Retail Consortium Director General, said: "This should be about customers. An ombudsman is unjustifiable pandering to supplier pressure groups. It would simply be an expensive bureaucracy - unnecessarily piling on costs with only one result; increased shop prices.

"If the economy where in good shape this would be a mistake but during a recession it is even more wrong.

"The Commission concluded that the UK's highly-competitive grocery market is benefiting customers. It found no evidence of systematic failure in retailers' dealings with suppliers, indeed average farm incomes are currently up 36 per cent on a year ago. Robust negotiations are a healthy part of these business relationships. It's crucial that any new legislation doesn't damage customers by adding to costs and hampering the successful competition which, the Commission acknowledges, delivers value, choice, innovation and convenience.

"The voluntary supplier code has long been compulsory for the ‘big four' supermarkets. It's a sensible attempt to set down what is and is not permissible behaviour. A range of retailers are already following the code's provisions. Extending and strengthening the code makes an ombudsman even less necessary."



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British Retail Consortium

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