Grogan speaks over supermarket pricing

- Last updated on GMT

Related tags: Supermarkets, Supermarket, Loss leader

There are few issues affecting pubs that John Grogan, Labour MP for Selby in Yorkshire, hasn¹t campaigned for in recent years.He has pushed the...

There are few issues affecting pubs that John Grogan, Labour MP for Selby in Yorkshire, hasn¹t campaigned for in recent years.

He has pushed the government to investigate areas ranging from Sky¹s price increases to standing up for the trade during the furore over pubs and binge-drinking in 2005.

In the main this has come through his role as chairman of the All-Party Parliamentary Beer Group. But undoubtedly he has not just confronted these issues out of civic duty ­ he is a passionate supporter of the licensed trade.

In December Mr Grogan laid Early Day Motion 495 in front of Parliament. The motion was his attempt to try and bring the issue of supermarket promotion of alcohol to the attention of those at the top of government. The EDM now has 65 MPs signed up to it.

While much work had been going on behind the scenes, by bodies such as the British Beer & Pub Association, this was the first significant move in the public arena to take on supermarkets on this issue.

In an exclusive interview, Mr Grogan spoke to The Publican about the serious issue of supermarket pricing, how he believes the EDM is progressing, what his long-term aims are on this issue and what he thinks about The Publican¹s Dump the Deals campaign.

Last week the Competition Commission issued an interim report on its investigation into supermarkets and for the first time it linked supermarkets, alcohol and loss-leading. How significant do you think this is?

What has been interesting as far as the commission goes is people¹s reaction to the statement. For example, The Daily Telegraph emphatically linked the pricing policies of supermarkets with binge-drinking.

Now I think the commission sees alcohol as quite a small section of total supermarket sales. So it might say that loss-leading won¹t massively distort sales.

However, what is significant is that no one can now deny that supermarkets are loss leading with alcohol. Indeed, we can now say beyond doubt that they are.

Six months ago the supermarkets would have vigorously disputed such a charge. Now I don¹t see how they can. And an interesting question is what will other ministries make of this fact ­ like the Department of Health and the Home Office?

What pushed you to table the EDM in the first place?

I had heard about this issue over a long period of time and from a wide range of people; from pubcos, brewers and the police. I felt that there was a large coalition of people coming together on it.

I also thought about it after speaking to John Denham on the subject. He now chairs the Home Affairs Select Committee and has always been a serious critic of licensing reform.

But he has told me that his thinking is turning away from pubs and clubs and moving towards supermarkets. He also said he believed the on-trade deserved some credit for getting its act together on this issue.

I always thought that during the controversy over binge-drinking the supermarkets played a much more skillful game than the on-trade. They just kept their heads down! And pubs and clubs then bore the brunt of the criticism.

I took a lot of inspiration from the All-Party Parliamentary Small Shops Group to go at supermarkets on this issue. It had very effectively managed to campaign for the commission to open the investigation that it is running at the moment.

What can the pub trade do to help with this campaign?

There are two reasons why MPs sign an EDM. Firstly because a colleague, like myself, thrusts the proposal in front of them, or secondly because of local pressure.

One letter from a local pub is worth 20 letters from a trade association. I cannot stress enough how important it is to write to your local MP if you want to see action on this issue.

And so the contribution of The Publican and its Dump the Deals campaign is crucial in keeping up the substantial pressure to achieve something concrete.

In your opinion what have the supermarkets got wrong?

Well, when it comes to the subject of loss leaders you do have to approach the sale of alcohol in a slightly different way than you might do with beans or bread. If you look at their promotional activity during Christmas and the World Cup, so much of it was focused on alcohol. And we are in this situation where the more cheap alcohol you buy the more discount you get for it.

One problem is that we don¹t have any concrete research ­ we need to know, for sure, where people do most of their drinking. Any such research would be an important building block in this argument. We need to have a proper study looking at where binge-drinkers drink most of their alcohol.

So should we look to get the supermarkets to increase their prices?

Well, we do need to be cautious here and come up with a carefully constructed argument.

I am actually getting one or two letters from OAPs worried that this campaign will lead to increased alcohol prices. These are people who don¹t have a huge amount of money and go to their local Morrisons on a weekend and buy a four-pack of beer. They will enjoy two on a Saturday while watching Match of the Day and will have the other two over Sunday lunch. So increased prices aren¹t necessarily the answer.

So what do you want to see the supermarkets doing?

I think there are two very achievable aims here. First, supermarkets need to sign up to a code of conduct ­ perhaps similar to the one the on-trade has signed up to, in terms of dealing with irresponsible pricing and promotions.

Secondly, I would want to see them eradicate loss-leading with alcohol.

How have your backbench colleagues reacted to your EDM and campaign?

There has been a very positive reaction, but it has not yet reached a critical mass. It has very much excited the trade and it is starting to get into the national media. We are yet to see the kind of clamour that the on-trade had to endure before licensing reform. But I have to say that it is all bubbling away nicely.

Are many ministers and front-bench MPs taking notice?

I think ministers are aware of the issue but it is still not on top of their in-trays and we need to make it so. The off-trade has boxed clever for a long time. It has a lot of political power and influence.

Related topics: Legislation

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