Private Investor: Happy to be with the supermarket that ate Britain

Just as my slow-moving mind turned to the implications of the General Election for my portfolio, Tony Blair confirmed the lengths to which politicians will go, just to gather in a few more marginal wobbling votes. In the last session of Prime Minister's Questions before the election, he, not to my surprise, picked on the supermarkets.

Blair told the House of Commons, in a message clearly aimed at a wider national audience, that ministers will look again at the voluntary code of practice covering the commercial relationship between supermarkets and their suppliers, if re-elected: "I think it is a serious issue and we are going to study the code very carefully. It is important it is implemented. After all, that was part of the agreement we came to with the supermarkets. If in a position to do so [after the 5 May election], we will certainly look at it."

Now this isn't the parliamentary sketch, and I have to declare an interest as a supporter of the Liberal Democrats, but, as usual with a Tony Blair answer, you can read whatever you like into it. On the one hand, he suggests to voters that the Government's going to get tough with the likes of Tesco; on the other, there is a nod and wink to the companies that they'll "look at it", so no commitment whatsoever on action on what is, after all, purely a voluntary code.

He may find himself being trumped, either by one of his opposition colleagues or by some Labour candidate probably in no position to deliver on such a promise. So a £5 Tesco online voucher prize will be awarded by me to whoever tells me of the first politician to promise another review by the Office of Fair Trading into the supermarket's power.

As recently as March, in fact, an Office of Fair Trading report said the big supermarkets were broadly sticking to the code, although it may be that its investigation had been hampered by suppliers' reluctance to complain for fear of losing business. Another investigation so soon? I think not.

So I reckon Tesco shareholders like me have little to fear in the short term. Organic growth is still there, acquisitions are yielding good results, and the business is spreading into more and more areas, fields that would have seemed quite impossible for a grocer to muscle in on only a few years ago.

If my own experience in trying to organise a Tesco broadband connection is anything to go by, however, Tesco's management might do well to look before they leap into what can be pretty specialised stuff.

There must be people out there now whose lives have been completely "Tescoed". By which I mean that they will buy their groceries there, their newspapers, their lottery tickets, cut flowers, seeds, car care products , CDs, DVDs and basic electronic products. When they've done that, they'll pick up the leaflets and get themselves Tesco home insurance, Tesco pet insurance and Tesco breakdown cover. Then they can apply to have all their gas and electricity supplied by the company and can top it all off with a Tesco mortgage.

The supermarket that ate Britain? You bet, and the fact that it is poised to bust the £2bn profits barrier next week proves the point. So I'm very happy to be holding Tesco, and I note that the shares haven't collapsed in the wake of the Prime Minister's remarks. The interesting thing now is whether it is safe to buy into Sainsbury's.

It's not that bad in there and there must be some sort of floor that they seem to have bounced off from. I'll be looking in at my local Sainsbury's before I buy the shares, though.

s.o'grady@independent.co.uk