Scotland's farming union has expressed its anger at the Office of Fair Trading announcement today that it will not be considering any further steps to police the relationship between UK supermarkets and their suppliers.

NFU Scotland has consistently told the OFT that it will never receive on-the-record complaints from suppliers of unfair supermarket trading practices if it does not offer any protection to those who complain. The fear of losing supermarket contracts as a result of complaining is so widespread that the Supermarkets Code of Practice is never used.

Recognising that evidence of breaches of the Code was never going to be forthcoming, NFUS conducted its own inquiry earlier this year, speaking to 14 of Scotland's top food and drink processors about their relationship with supermarkets, on the basis that the information was not attributed. Whilst some suppliers were very positive about their trading relationship, NFUS received some alarming evidence of trading practices the Code is supposed to prevent.

The evidence received by NFUS included demands from some supermarkets of lump-sum payments to keep business, contract and payments terms being changed without notice or negotiation and supermarkets trying to 'manage' the public statements of their suppliers.

Reacting to the OFT announcement today, NFUS President John Kinnaird said:

"I am astonished that the OFT can continue to claim there is no evidence that the supermarket code needs changed and that the market is working well for consumers. We sent them exactly that evidence, but again, the OFT has chosen to ignore it because we didn't put the names of the companies suffering from the disgraceful trading tactics in our evidence.

"Some supermarket relationships work well, but I know there will be a broad smile on some supermarket buyers' faces today who have effectively been given the green light from the Government's competition authority to continue to squeeze suppliers unfairly.

"There is one obvious question hanging over this whole issue; if supermarkets have nothing to hide, why would they oppose an independent watchdog to protect suppliers from unfair trading practices?

"We will not let this matter rest and will continue to take this issue up with the Department of Trade and Industry. This whole OFT investigation stinks and has now shown itself to be nothing more than a whitewash."