Tesco Chief Slams Supermarket Ombudsman Plans

Tue, 16 Feb 2010
 
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Government plans for the introduction of a supermarket watchdog have been slammed by Tesco chief executive Sir Terry Leahy.

The government announced last month that it would establish an ombudsman to oversee dealings between grocery retailers and suppliers following a long investigation into the supermarket sector by Britain's retail watchdog, the Competition Commission.

The ombudsman has been billed to ensure "the grocery supply market continues to work in the long-term best interest of consumers". It would also help enforce a new groceries supply code of practice which came into force on February 4.

However, the head of Britain's biggest supermarket chain said an ombudsman would hurt shoppers as it would focus on the interests of suppliers rather than consumers.

Speaking to the Financial Times, Sir Leahy said:"I'm not in favour of an ombudsman. Everyone knows supermarkets are one of the most competitive industries around. That competition puts power in the hands of the consumer."

"In a free society, why would you want an ombudsman if there are no problems now as far as consumers are concerned?"

"An ombudsman would be there to protect suppliers but should be there to protect consumers."

He added that Tesco enjoyed a very good relationship with its suppliers, which were "unlikely to be helped by bureaucratic intervention".

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