Examination of witnesses (Questions 60
WEDNESDAY 24 JANUARY 2001
MILLS and DR
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
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,
(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 objectionand there was a case of this
after the lobster menthe 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.
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
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
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
73. Just to help me for example in terms of
the turnover figures we have seen here, if by value horticultureand
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
(Mr Mills) It is the former.
(Mr Mills) Quite explicitly it is the former.
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
(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 chapsHounslow
Borough Council own itwere 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.