The United States Senate has earmarked $900,000 (£639,000) to investigate the controversial subject of slotting fees, cash paid by manufacturers to retailers for shelf space, following allegations that the practice is stifling competition and innovation. Retailers claim the fees are a legitimate way of sharing the risk of introducing new products onto their shelves. But the Federal Trade Commission, which began to scrutinise the practice last year after complaints from small manufacturers, revealed that supermarkets were increasingly demanding fees from companies supplying familiar items such as fresh fruit and vegetables. Carol Coutrier, president of the Massachusetts Speciality Foods Association, said food manufacturers were scared to talk about the fees for fear of "being blackballed by the supermarkets". Suppliers testifying before the Senate small business committee about slotting fees last autumn wore hoods for fear of retribution. The principle is simple, she said. "Whoever coughs up the most money gets the space." During a committee hearing last week, general accounting office officials said a thorough analysis of the practice was almost impossible because retailers were unwilling to assist their enquiries. "Although retail grocers and food manufacturers assure the public that slotting is beneficial for small businesses and good for consumers, fact finding critical to this committee's effort to examine slotting more closely has been blocked at every turn," said Senator Chris Bond, who heads the committee. One analyst observed that the growth in slotting "concurs neatly with the growth of Wal-Mart", but stressed it would be difficult and probably unwise to introduce legislation to try to curb or control the practice. "At the end of the day, it looks like interfering with the free market." Small farmers told the committee that retailers were now demanding free merchandise or cash up-front before agreeing to stock their produce, eroding their profits further and putting their businesses at risk. {{NEWS }}