Newsagent Carriage Charges

Written by Brian Cotter MP and published in Asian Newsagents Magazine on Mon 28th Apr 2003

As the Liberal Democrat Spokesman on Small Business I spend a lot of my time lobby the Government to try and get a fairer deal for the small businessperson. As the Managing Director of my own small business, employing some twenty people, I feel that I understand the highs and lows and indeed the realities of running your own business, and how an unexpected increase in outgoings can be a real concern when you are operating on limited resources.

It is for this reason that I have been leading a campaign in Parliament in conjunction with the National Federation of Retail Newsagents for over a year now calling for excessive carriage charges to be investigated.

In November 2001 I tabled an Early Day Motion, which is a petition that MPs can sign to try and raise awareness of an issue in Parliament. The motion drew attention to the work done by the NFRN and the important role that independent retail newsagents play within communities and the real threat that high carriage charges present to the viability of newsagents. The motion also called for the Office of Fair Trading to carry out an enquiry into the matter.

The motion received the support of 291 MPs, making it one of the most strongly supported motions tabled in Parliament in 2001, and demonstrating how important the issue is.

The OFT reported back its findings and its recommendations in December last year, and I am pleased to say that in the main the report appeared to be good news.

With the NFRN I particularly welcomed the fact that the OFT recognised that power is becoming more and more concentrated in the hands of just three wholesalers, and that while carriage costs have increased the level of service provided by wholesalers has actually decreased. Another important point made by the OFT was the fact that such increases in carriage costs actually reduce newspaper availability, which I believe can only be detrimental to the consumer.

One of the recommendations put forward by the OFT was the introduction of sub-retailing, which would allow some newsagents to act as mini-wholesalers. While I can see the advantages of such a system, I also agree with the NFRN, that it would need to be managed carefully in order to ensure that it didn't just create another tier in the distribution chain and therefore slow down the whole process. The issue of selling across exclusive territories also needs to be taken into consideration.

If such a scheme is adopted universal provision for retail newsagents must be guaranteed in order to ensure that smaller and more remote newsagents receive comparable terms to large and more centrally located outlets.

In February I tabled a new motion, listing these points and calling on the OFT to take into account the views of newsagents and the response from the NFRN. So far this motion has received the support of 129 MPs across all three main political parties.

The report from the OFT is only the first stage in a long process. The consultation period has now come to an end and the next stage is for the OFT to put forward its final recommendations, which will then go to ministers at the Department of Trade and Industry who will have the final say.

It is important that all those involved in the process continue to lobby the Government until the very end to ensure that newsagents get a fair deal and their views are fully taken into consideration.