A new Bill introduced to Parliament this week by Alistair Carmichael MP for Orkney and Shetland and Chair of the Environment, Food and Rural Affairs Committee could bring significant changes to the UK food supply chain. The proposed legislation seeks to address power imbalances in the market, ensure fairer treatment for farmers, and enhance oversight of supermarket practices.

Alistair Carmichael said the UK food supply chain needs “direct and meaningful intervention” from the Government and warned that “without it, we risk losing domestic food production and any notion of food security.” We take a look at the Bill's key objectives and try to anticipate how it could influence business operations.

The Bill aims to enhance the powers and resources of the Groceries Code Adjudicator (GCA), which oversees relationships between supermarkets and their suppliers. The current structure has been criticised for being underfunded and ineffective, with no fines issued since its creation. The proposed reforms would ensure better enforcement of fair trading practices.

A key feature of the Bill is greater coordination between the GCA and a new Agricultural Supply Chain Adjudicator. This would create a more robust regulatory framework, specifically targeting unfair practices that disadvantage farmers.

The Bill also seeks to encourage the use of domestically produced food in public procurement, alongside a proposed push for more transparency in food labelling, ensuring consumers can make informed choices about the origins of their food.

If the Bill is enacted, supermarkets may face stronger regulatory pressure and oversight of their purchasing practices. Meat processors, who act as intermediaries between farmers and retailers, are likely to remain sanguine about the potential changes. The recent fairness review in the pig supply chain has been received well on the whole and, while there is not talk yet of anything on the beef side, BMPA members are already signed up to a voluntary good practice code. On the sheep side, pricing fairness is much more embedded in the system as more sheep are sold through livestock auction markets.

One thing Mr Carmichael's speech highlighted was the concern that price wars, like the one that has just broken out among major UK retailers, could lead to further pressure on suppliers, including meat processors. Bringing the whole supply chain under consideration from farm to shelf should be a good thing as pricing pressure generally comes from the top down.

The other major point to note is one that BMPA has been making for some time and that is the damaging effect that market imbalances in the food supply chain have on Britain's food security.

Quoting Keir Starmer who has said that "food security is national security", Mr Carmichael warned that aggressive price wars coupled with recent policy changes - notably the withdrawal of Basic Payments quickly followed by the abrupt closure of the Sustainable Farming Incentive - have left farmers financially vulnerable. The message is that, without intervention, the UK risks undermining its own food security and leaves it less resilient to global supply chain disruptions.

While the Bill has garnered cross-party support and endorsements from farming and land associations, its final form and passage through Parliament remain uncertain. BMPA will be actively engaging with policymakers to ensure that the concerns of our industry are considered in the final legislation.

You can read a full transcript of Mr Carmichael's speech introducing the bill. Or you can watch a ten minute video of the full speech.