Clause 10 - Recovery of investigation costs

Groceries Code Adjudicator Bill [Lords] – in a Public Bill Committee at 12:15 pm on 13th December 2012.

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Photo of Ian Murray Ian Murray Shadow Minister (Business, Innovation and Skills) 12:15 pm, 13th December 2012

I beg to move amendment 46, in clause 10, page 4, line 10, at end insert—

‘(6) Costs do not form part of financial penalties as described in section 9.’.

There is no doubt that, in the Labour party headquarters, there are people furiously scribbling a press release stating that we have defeated the Government in the Groceries Code Adjudicator Bill Committee. May I congratulate my hon. Friends for allowing that to happen? It must have been the power of our arguments that means that schedule 3 has been removed from the Bill. That was a sensible decision.

The amendment is straightforward. It relates to clause 9 as now amended, but it was tabled before the Minister came forward to put the time scales for fines in the Bill. Now that fines are in the Bill, the amendment is even more important. We seek to ensure that any costs, in terms of investigation, that the adjudicator awards against a large retailer do not form part of any financial penalty levied on that retailer.

We appreciate that fines would be used in the escalator fashion only for serious breaches, but it would be quite unfortunate if a retailer were fined for a considerable breach and then the adjudicator said that the fine should be x—based on the parameters set in the Bill—but it will be reduced to a lesser amount because we are also imposing financial penalties on the retailer. Clearly, costs incurred as a result of any abuse should not form part of the penalties. The amendment is straightforward.

Photo of Jo Swinson Jo Swinson The Parliamentary Under-Secretary of State for Women and Equalities, The Parliamentary Under-Secretary of State for Business, Innovation and Skills

I thank the hon. Gentleman for his amendment. I hope that I can reassure him and the Committee that the Bill as it stands already ensures that costs and financial penalties are treated entirely separately. Whether a retailer is required to pay a financial penalty is independent of whether they are required to pay the costs of an investigation. The two items—costs and financial penalties—serve different purposes and need to be assessed separately. For example, it would not be  possible for a retailer to offset part of a financial penalty against its liability for costs. I hope that that provides a degree of reassurance, so that the hon. Gentleman does not feel the need to press his amendment to a vote. Another option is for the retailer to be required to pay costs when there is no fine, because the Bill as drafted initially did not include fines from day one. It may well be that retailers are liable to pay costs even though the adjudicator has taken the view that a breach was not sufficiently serious to impose a financial penalty or fine in addition. Those are different matters for the adjudicator to consider and, as such, amendment 46 is unnecessary and I hope that the hon. Gentleman will be reassured and agree.

Photo of Ian Murray Ian Murray Shadow Minister (Business, Innovation and Skills)

I am extremely reassured and, therefore, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 10 ordered to stand part of the Bill.