Select Committee on Agriculture Minutes of Evidence

Examination of witnesses (Questions 60 - 79)



Dr Turner

  60. The local NFU have not raised this issue with me recently.
  (Mr Mills) This is case law. The interesting point is we have taken extensive legal advice on it, as I am sure the Corporation of London have, but it is quite clear to us that a market in the common law definition is a "physical concourse of casual buyers and sellers". That is the definition of a market in all the case law that appertains to this. There are two aspects to it. A physical concourse of buyers and sellers means face-to-face trading. If a buyer comes into the market, looks at the produce available, goes out of the market, gets out his mobile phone and phones through an order, that is not face-to-face selling or if he does it by e-commerce, by fax or e-mail, and that would be okay. In that sense the market does not exist because it is not face-to-face selling. Even if there were face-to-face selling, which is the point of the latest application to the Minister, it is, in my view, quite clear that that should be allowed because the definition of a market in all the different cases that go back for many years is a "physical concourse of casual buyers and sellers". In other words, any member of the public can come in to buy and to sell in a market area. They cannot in our place because we provide for casual buyers but not for casual sellers. We cannot have some chap coming in, pitching his tent and selling his stuff, he would have to have a lease and a legal contractual agreement. In my view, the six and two-thirds miles does not apply and I was very interested to note that in the Corporation's own written evidence they have not relied on that as an argument. There is a lot more I could say if you wanted me to about the Corporation's evidence.

  61. I wanted to understand how important this decision was to you.
  (Mr Mills) Extremely.

  62. Is this the key to you being able, in fact, to diversify?
  (Mr Mills) It is a major key because up until a few years ago what happened was that if we made an application for a non-horticultural trader to come in (like the lobster chap) the Minister would write to the Corporation of London and anybody else so they got the objection—and there was a case of this after the lobster men—the Corporation of London would say no and so the Minister then said no. In other words, the Minister would not gainsay the Corporation's view. It has been clearly established (and the Ministry accept this) that while the Corporation of London are perfectly entitled to express a view, that view is not binding on the Minister. He has to make his own judgement as to whether in his view we are not acting illegally but also that we are doing the right thing in pursuance of our statutory duty, which is to make best use of our assets. That was a key decision. Now the Ministry advise the Corporation and anybody else of our proposal, and will listen to their views.

  63. I am interested in how important this is to you. Are you going to be profitable if the answer is no?
  (Mr Mills) It would make things more difficult and would be against our statutory responsibility. We would not be making best use of our assets.

  64. When are you hoping to have the decision?
  (Mr Mills) Soon. But really the guys you want to ask are the Corporation of London as to why they do not reply in detail to the letters the Ministers send them.


  65. Considering you expect them to be your sole purchaser eventually, there is a bit of bridge-building that needs to take place.
  (Mr Mills) You cannot win, Chairman. It is Catch-22. If we were to lie down with our legs in the air what would happen? We would not be as popular and as successful as we are. We have had to be fairly aggressive.

  66. The reason I make the point is that of course the Authority applied against the Corporation of London for an injunction objecting to the size of Spitalfields Market, in other words, you said, "Don't let them get too big and take our trade " but you seem to be saying it is fine if we go ahead and take their trade. It seems to be heads I win, tails you lose.
  (Mr Mills) That is not quite the case, Chairman. That was 1990 and that was well before my time and it was for five years only. It was of limited life and does not apply any more.

Mr Jack

  67. Just to move on from Dr Turner's line of questioning because you discussed the new activities compared with the traditional fruit and vegetables and flowers activity. In your submission to us at paragraph 20 you say: "The statutes governing the Market and the Authority mean that at least 50 per cent of our produce must be horticultural . . ." and you describe that as "fruit, vegetables and flowers". Then you go on to say: ". . . but equally it means that, subject to Ministerial approval, up to 50 per cent can be non-horticultural." You describe the element of Ministerial approval in some detail. Can you give us a flavour for how the balance is between the 50 per cent that is horticultural and all of these new activities because if the proportion of horticultural, as the chart, showed is coming down, does that not constrain the total size of other alternative activities that you can indulge in?
  (Mr Mills) Yes indeed it does. In my view, that on 50 per cent and 50 per cent you can make a very reasonable case for saying 60 per cent could be non-horticultural as long as you maintain that core function of providing facilities in bulk for horticultural produce.

  68. Notwithstanding the statute position that says "at least 50 per cent"?
  (Mr Mills) "The statutes governing the Market mean . . . at least". That is undisputed by the Ministry or anybody. What I am saying is in my view if you look in detail, and the actual figure of 50 per cent is not specified as such in the statute, there is a clear case for saying you could have more than 50 per cent. But we have not got to that position and we will not get to that position for some time. What we have got at the moment is about 12 non-horticultural traders.

  69. Who blows the whistle if this balance gets too skewed to non-horticultural?
  (Mr Mills) I think it is Section 18 F of the 1961 Act which refers to "making best use of our assets". Because it is non-horticultural we have to get the Minister's approval. If we get a fruit and vegetable trader in, that is part of our statutory duty so we do not have to ask the Minister for permission, but to get a non-horticultural chap in it is not our duty but it is encouraged in the sense it is making best use of our assets.

  70. Am I right in saying that you have had car boot sales on the site of the Market?
  (Mr Mills) That is a slightly pejorative way of putting it, with respect.

  71. On Sunday.
  (Mr Mills) On Sunday when the Market is not operating there is a company that have asked us whether they can run a market. I think they would be a bit chagrined to call themselves called a car boot sale. It is very well run. They rent the space from us on a Sunday on a day when the Market is not in operation.

  72. It sounds to me, if I have understood you correctly, that there is a considerable element of flexibility between the balance that is horticultural, in other words the traditional objectives of the Market and all those other activities that can go on, and at the moment nobody is watching too closely what this balance is.
  (Mr Mills) We have tried, this happened particularly in the early to mid-1990s, to maximise revenue from any source. In the days when we had 30 per cent unoccupied spaces we let the Post Office park some of their vans on a bit of our land near the main entrance. We have some coach parking on the big car park. We have some car parking for other companies in the multi-storey car park we have got. We tried to maximise revenue, which I believe is the best thing to do, and also to help us fulfil our financial duties, but in terms of any non-horticultural trader we have to get Ministerial approval, so we cannot sneak in a couple of guys selling whatever, we have to get Ministerial approval. As it happens, it is not their function, but Ministry inspectors in terms of health and safety and pricing are round the Market almost every day.

  73. Just to help me for example in terms of the turnover figures we have seen here, if by value horticulture—and I am assuming there is not a tighter definition of "fruit, vegetables and flowers"—
  (Mr Mills) Not in the Act.

  74.—If it got down to 40 per cent and you were at 60 per cent for the others, do you sit there and say, "There it is, we are fulfilling our financial objectives to make our profit one year with another or not to make a loss" and you just hope that nobody will notice?
  (Mr Mills) I would not mind if anybody notices. I hope they notice; I am quite open about it all.

  75. Why I am asking these questions is you have shown a diversification in the context of a market now which is more food based than anything else. You have indicated that from time to time all kinds of other revenue raising activities on a short-term basis like storing furniture can be incorporated. Is your strategy to continue to focus and develop a food-based market or is the strategy to carry on trying to get revenue from the site?
  (Mr Mills) It is the former.

  76. Right.
  (Mr Mills) Quite explicitly it is the former.

Mr Mitchell

  77. The Corporation in its submission says there is a kind of "delicate inter-relationship", as it describes it tactfully, between the wholesale markets in London. How would you characterise the relationship between the wholesale food and produce markets?
  (Mr Mills) Our relationship with Billingsgate Fish Market and Smithfield Meat Market and Spitalfields Fruit and Veg Market at a working level with the Chairmen of their committees and their superintendents is very cordial and very interesting and when meetings, informally or formally, take place we discuss issues about how they are getting on with waste disposal, what is their experience of this and that, and it is all very sensible and adult. We do not have a relationship as such with the Corporation of London because that is a relationship in the sense between the Ministry and the Corporation but with individual members of the Court of Common Council or Policy and Resources Committee of the City personally relations are fine. If I may, Mr Mitchell, if you look at paragraph 6 of the Corporation's evidence ". . . the Corporation considers the trading arrangements at New Covent Garden Market should not be varied, to the detriment of the other wholesale food and produce markets in London, before all the markets concerned have been given a reasonable opportunity. . ." The Minister in March last year called a meeting of all the London markets including Western International and the Borough Market to discuss possible harmonisation of the markets. It was a perfectly fair thing for the Minister to undertake and he chaired the meeting and he asked each of us about our plans for the future. The Western International chaps—Hounslow Borough Council own it—were quite clear and explicit about what was going to happen there. They are going to build a new site next to the old one. The Borough Market is developing what is really a retail market rather than a wholesale market. I said quite clearly we were going for the strategy of a one-stop shop for food produce. The Corporation of London did not say anything. The Ministry have tried to get from the Corporation their detailed objections when we have submitted cases for going into fish and meat and they have not got them. So I find it a little odd that the Corporation are saying in paragraph 6 that all markets should have been given a "reasonable opportunity to indicate the nature and extent of the damage" They have had it.

  78. That is Corporation-speak, is it not, it is tactful? Is not the reality that you are all there hands affectionately placed around each other's throats, knees to each other's groins battling it out for a shrinking market?
  (Mr Mills) It is a bit like the House of Commons then in that sense.

  79. We have got market dominance. I am talking about the Labour side of the House.
  (Mr Mills) All the markets are affected by the trends in food eating and food distribution and we are all trying to do our bit in a sense to preserve our own market, but certainly we are trying to think longer term what is the future.

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