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We welcome the Minister’s assurances that there is no intention to extend the relaxation of...

Recommendation
We welcome the Minister’s assurances that there is no intention to extend the relaxation of competition law for retailers. We repeat our recommendation that the Government and Competition and Markets Authority should review whether the relaxation of competition law has been detrimental to consumers and suppliers to large retailers during the pandemic. The Government should also proactively seek to reverse the loss of market share by small retailers and the hospitality sector; and to encourage greater market access for locally produced foods. It should also help facilitate digital support for local businesses. (Paragraph 51) 26 Covid-19 and the issues of security in food supply
Government Response
Acknowledged
HM Government Acknowledged
Throughout the Covid-19 response, the Government worked closely with the appropriate bodies to ensure the protection of consumers and suppliers. In March 2020, the CMA launched a programme of work to identify, monitor and respond to competition and consumer problems arising from coronavirus and the measures taken to contain it. To ensure protection of consumers, the CMA has continued to monitor complaints received during the pandemic. In March 2021, the CMA’s report ‘Protecting consumers during the Covid-19 pandemic’1 showed that complaints about high pricing (which might reflect a lack of competition), which were high at the start of the crisis in March 2020, have fallen sharply since then. The volume of price-related complaints declined since early April 2020 and remains at low levels: fewer than 100 in February 2021, compared with over 16,000 in March 2020 across all channels. Direct suppliers to the large supermarkets continue to be protected by the Groceries Supply Code of Practice. The Government extended the appointment of the then Groceries Code Adjudicator (GCA), Christine Tacon, until October 2020 to oversee any Covid-19 related issues that may have arisen. The GCA had urged suppliers to report any Code-related issues and maintained regular contact with the retailers’ Code Compliance Officers to monitor whether any issues linked to the pandemic had been raised with them. None were reported. The GCA’s latest annual survey of suppliers has found the number of suppliers reporting they had experienced any Code-related issues at any stage in the past year had fallen to a record low - down to 29% compared to 36% in 2020. The current GCA, Mark White, will continue to work with the sector to ensure suppliers are protected by the Code as retailers respond to the impact on their margins of the structural changes made at speed during the pandemic. With counterparts across Government, and through engagement with industry, we continue to monitor the impacts of Covid-19 on the food sectors, including small retailers and the hospitality sector. The Government remains committed to working in partnership with industry to respond to these challenges as they evolve. Small retailers and hospitality outlets are eligible to apply for cross-economy schemes, such as: the Recovery Loan Scheme (providing £25,001-£10m in financing per business with a Government guarantee of 80%); the extended Coronavirus Job Retention Scheme (CJRS); eviction protection for commercial tenants (extended until 30 June 2021); and the extended Trade Credit Reinsurance Scheme, to support businesses and sectors reliant on Trade Credit Insurance. 1 https://www.gov.uk/government/publications/update-on-work-of-the-cma-during-the-coronavirus-pandemic- 15-march-2021/protecting-consumers-during-the-coronavirus-covid-19-pandemic-update-on-the-work-of-the- cma 12 Second Special Report of Session 2021–22 The Government has also provided enhanced support to the retail, hospitality, and leisure sectors through business rates relief, given the direct and acute impacts of the Covid-19 pandemic on those sectors. All eligible businesses in the retail, hospitality, and leisure sectors will pay no business rates in England to 30 June 2021; followed by 66% business rates relief for the period from 1 July 2021 to 31 March 2022, capped at £2 million per business for properties that were required to be closed on 5 January 2021. There is no rateable value threshold on this support – businesses large and small will benefit. There is further support available to support the hospitality sector as it begins to re-open. Businesses in the sector are eligible for Restart Grants of up to £18,000 per premises. The VAT cut to 5% for hospitality will continue until 30th September 2021, followed by a 12.5% rate until 31st March 2022; while there has also been a freeze on alcohol duty. In order to encourage greater market access for locally produced foods, the Government is stepping up delivery of its manifesto commitment to build demand for and promote British food both at home and abroad. Domestically, we want to celebrate the quality, provenance and heritage of our wonderful food across all regions of the country, working with local organisations, retailers and Regional Food Groups to raise consumer awareness and demand for local produce. We are taking forward a programme of work to build capability of local producers and SMEs to capitalise on growing demand in their communities, for instance by developing innovative routes to market to increase their reach to local consumers. In parallel we are working with retailers to enhance promotion of local, seasonal and sustainable products. The Government’s ‘Help to Grow: Digital’ scheme will provide digital support to SMEs; through this scheme we will launch a new online platform where up to 100,000 businesses can access impartial advice on software, and a voucher to reduce the costs of buying that software, worth up to £5000 a year pe