Dáil Éireann debate -
Thursday, 8 Mar 1956

Vol. 155 No. 2

Restrictive Trade Practices (Confirmation of Order) (No. 2) Bill, 1955—Second and Subsequent Stages.

Minister for Industry and Commerce (Mr. Norton)

I move that the Bill be now read a Second Time. This is the second Bill of its kind to come before the House. Its object is to confirm and give the force of law to an Order which I have made under Section 9 of the Restrictive Trade Practices Act, 1953, relating to trade practices affecting the supply and distribution of building materials and components. The first Bill, relating to the trade in radio sets and accessories, recently received the approval of all Parties in the House and, as the principles underlying the present Bill are the same, I am sure that this measure will commend itself to the House, generally.

Deputies will be aware that the Fair Trade Commission undertook a statutory inquiry under Section 7 of the Restrictive Trade Practices Act, 1953, in relation to the supply and distribution of building materials and components. Subsequently, the commission furnished to me a report of the inquiry describing the conditions which obtain in the trade and indicating that, in the view of the commission, certain practices exist which interfere unfairly with competition and operate against the public interest. The report has been published and copies have been circulated to Deputies. However, to facilitate the House, I propose, at this stage, to give a résumé of the commission's report and of the recommendations which the commission make with a view to prohibiting the restrictive trade practices which are considered to be unfair or to operate against the public interest.

Deputies will understand that in referring to trade practices, I am referring to the position as it was stated in the commission's report and that I have no means of knowing to what extent, if any, practice has been altered in the meantime. According to the commission's report most building materials and components are manufactured in this country and are sold mainly through builders' merchants. The goods are for the most part supplied on the basis of a retail list price from which discounts and rebates are allowed at varying rates according as the purchaser is a merchant, a builder, a local authority or other type of user. Up to a short time prior to the commencement of the inquiry by the commission in December, 1953, purchasers had been confronted with a uniformity of prices that indicated collusion between merchants regarding the selling prices of a wide range of commodities essential to the building industry. About August, 1953, a measure of competition in prices between the merchants dealing in certain materials developed and gradually extended to an increasing range of materials.

At the time of the inquiry there was, nevertheless, a total absence of price competition between merchants on the resale of some materials while there was an understanding between merchants to avoid price competition where possible in the sale of certain other materials. Moreover, associations of merchants sought to establish arrangements with manufacturers and other suppliers with the object of regulating the channels of distribution. In some instances, the supply of building materials has been confined to certain approved distributors with the cooperation or acquiescence of the manufacturers.

The effect of these arrangements has been to discourage competition, and to fortify the position of established merchants. In the case of a number of imported commodities the local associations have endeavoured—in some cases successfully—to make arrangements with manufacturers and organisations in other countries for the limitation of supplies to firms approved by the local associations. There are, also, arrangements between associations providing for the suppression of competition by the territorial division of the market. Most of the building materials which were the subject of the inquiry are protected either by tariffs or other import restrictions and in certain cases the existence of protection appears to have facilitated the growth of restrictive practices.

A notable feature of the trade is the number of associations in which builders' merchants are organised. There are no fewer than 16 trade associations representing merchants handling building materials. The commission's report shows that there is a marked similarity of phrasing in the rules of some of these associations which was particularly evident in the changes made in certain rules after the introduction of the Restrictive Trade Practices Bill in 1952. There is interlocking membership between the associations. As the chairman of one association put it, the associations are dovetailed into one another. The regulation of the marketing of many items is a stated objective of a number of merchants' associations. There is a marked hostility of organised merchant opinion to price competition, which, where it is allowed to operate at present, is regarded as a lamentable retrogression from the position which existed prior to mid 1953. The modifications of policy which took place in 1953 were effected because of surreptitious competition and not from any desire on the part of merchants for price competition. The withdrawal effected in 1953 from certain longstanding restrictive practices is tentative, and there can be no confidence that such practices will not be resumed at a more opportune moment.

Dealing with interferences with price competition through the operations of combinations of merchants—in what are commonly known as price rings— the commission point out that it is obvious that any body of merchants, in fixing gross profit margins, will consult their own interests and that their interests do not necessarily coincide with the public interest. In the opinion of the commission, prohibition of competition in price between merchants results in an enhancement of price to the public, removes a vital incentive to economy in distribution, blunts the benefits to the consumer of competition between manufacturers, prevents or retards the development of potentially more efficient methods of distribution and leads to abuses of various kinds, such as collusion in tendering to public bodies.

These objections, in the opinion of the commission, are more than sufficient in themselves to justify the conclusion that any measures for the elimination of price competition between merchants in this trade operate against the public interest and should be prohibited. The views of the commission on horizontal price-fixing by "price rings" are fully set out in paragraphs 37 to 50, inclusive, of their report. With regard to price maintenance imposed by manufacturers, whether individually enforced or enforced by agreement with other suppliers, or with combinations of merchants, the commission point out that such price maintenance also denies to the public the benefit of price competition between merchants and removes the incentive provided by such competition to improved efficiency in distribution, and the conclusion of the commission is that the practice operates against the public interest. In some cases, as is pointed out in different chapters of the report, none of the considerations commonly urged in favour of price maintenance by manufacturers was relevant.

There is a further consideration relating to the trade in building materials which reinforces the importance of the considerations already mentioned, viz., the degree to which public policy has entailed the intervention of the State and local authorities in the financing of housing and other building construction. State subsidies of one kind or another, and contributions by local authorities, in respect of housing, have, in recent years, been of the order of £4,000,000 annually. Other social services involve very considerable annual expenditure by the State or local authorities on the construction of hospitals, sanatoria, schools, etc. Any arrangements which lead to an enhancement of the prices of building materials inevitably result in a reduction in the volume of housing and construction financed from a particular allocation of public moneys, and must, therefore, be of serious concern to the State.

The arrangements by associations governing entry to, and status in, the trade in building materials generally take the form of a classification of merchants and the establishment of conditions for entry into each class. Merchants are generally classed as "A" and "B", the "A" merchants being entitled to a higher trade discount than the "B" merchants. Entry into a class is governed by conditions which vary between different associations and between different commodities or groups of commodities, so that a merchant might be classed as a "B" merchant for the sale of one commodity and an "A" merchant for the sale of another commodity. Conditions of entry generally require the achievement of a certain turnover in the goods concerned in advance of entry and the performance of merchanting functions by the applicant.

In addition, the applicant is sometimes required to show that he maintains stocks of a certain magnitude and that he possesses adequate premises. In the opinion of the commission, the policies and practices adopted by the associations relating to entry into the trade in building materials are, in their general tendency, unfair. The restriction of supplies on trade terms to comparatively few merchants may seriously handicap an excluded merchant in his business generally. A merchant who is not in a position to supply, on appropriate terms to a builder, some of the goods normally provided by a merchant may lose that builder's custom altogether. A merchant prevented from obtaining the best terms is obviously handicapped in competition with the merchant in receipt of such terms because of the difficulty of providing a comparable service on a smaller gross profit margin.

The commission are of the view that on two principal grounds the practices of associations in relation to the supply of building materials are contrary to the public interest and should be prohibited. Firstly, by restricting the numbers of merchants trading in particular commodities, the practices limit competition and facilitate the control of prices by the associations concerned. Secondly, by strongly resisting the supply of the goods through alternative channels, the trade associations restrict competition and thereby prevent the interplay of forces which normally leads to the emergence of improved methods of distribution in response to changing circumstances and opportunities.

The commission consider that a manufacturer should not be prevented from developing his distribution system in the manner that seems best to him in the light of his requirements and responsibilities. They are of opinion that a manufacturer should, in his own discretion and without pressure from organised bodies of traders, be free to select channels of distribution for his products. In allowing freedom to the manufacturer in this respect, regard must be had to his position in the market. Where there is only one manufacturer of a particular product in Ireland it is especially important that the arrangements for the supply and distribution of the product should be equitable as between distributors generally, since distributors who may have reason to feel aggrieved have no alternative source of supply to fall back on.

The commission have had regard to objections advanced by merchants concerning the distributional arrangements of certain manufacturers and have suggested modifications in these arrangements with the object of removing what appear to the commission to be legitimate grievances. The commission consider that steps should be taken to ensure the avoidance of unfair conditions in the supply of goods while providing that any supplier may, on his own initiative, apply to the acceptance of orders for goods such terms and conditions as are reasonable in the interests of efficiency and economy in production and distribution or are necessary in the legitimate interests of the supplier, provided such terms and conditions are equitably applied.

With the object of removing the abuses which exist and restoring conditions of free and fair competition in the trade in building materials, the commission recommend in their report that an Order should be made prohibiting the particular practices which are considered to be harmful to the public interest. The commission recommend for instance, that resale price maintenance should be prohibited and that it should be made possible for merchants to determine their own selling prices in the light of their own operating costs. As regards arrangements and practices adopted by manufacturers and merchants with the object of regulating the channels of distribution, the commission recommend that it should be made unlawful for a manufacturer to withhold supplies from a merchant on the grounds that a merchant is or is not a member of a particular organisation or association or because the merchant's name does not appear on an approved list.

The commission recommend that individual or collective action against a supplier with the object of limiting him in his choice of channels of distribution or of customers or in his discretion in the grant of trade terms to any person should be prohibited. It is recommended by the commission that no manufacturer, trade association or organisation should be permitted to publish lists of approved or non-approved persons which are likely to restrict entry to the trade in building materials or to be used as a basis for regulating the supply and distribution of such materials. The commission recommend that it should be made unlawful for any person to secure a boycott of any manufacturer of building materials on the grounds that the manufacturer has refused to do any act which would be contrary to the terms of the Order. Agreements between suppliers, which provide for the suppression of competition by the territorial division of the market, should be prohibited and combinations of suppliers should be prohibited from being parties to any agreement to confine their orders to any suppliers outside the State.

There are, finally, two recommendations by the commission regarding the imposition by individual manufacturers of terms and conditions for the acceptance of orders. Firstly, it is recommended that a manufacturer should be permitted to impose certain conditions, including conditions as to the volume and frequency of orders, provided such conditions are reasonable, are equitably applied and are notified on request to the commission which may, if circumstances at any time so require, make fair trading rules in relation thereto. Secondly, it is recommended that there should be a prohibition against a manufacturer differentiating between customers who should in the normal way be supplied on the same terms and conditions having regard to the size and the frequency of their orders. The commission do not consider that a manufacturer should be prevented from advertising or specifying a resale price which is a maximum price or from withholding supplies from a merchant if the maximum price is exceeded. Any such specified price will not, however, be binding on merchants as a minimum price.

I have given careful consideration to the recommendations of the Fair Trade Commission. I am of opinion that the commission are fully justified in making the recommendations which are contained in their report and I agree entirely with these recommendations. I am satisfied that it is unfair that manufacturers of building materials, most, if not all, of whom have the benefit of tariff or other protection should discriminate against merchants by refusing to supply them on the grounds that the merchants are not approved by particular trade associations. I am of opinion also that it is wrong that it should be within the competence of vested merchant interests to restrict or regulate the right of new merchants to enter into the trade. I am satisfied that it is contrary to the interests of the consumer that the competition should be restricted both by the operation of arrangements between manufacturers and merchants to regulate the channels of distribution and by the enforcement of minimum resale prices for building materials. As I have already indicated, I have made an Order to give effect to the recommendations contained in the report of the Fair Trade Commission and a copy of the Order has been circulated to Deputies. Section 9 (3) of the Restrictive Trade Practices Act, 1953, provides that an Order of this kind shall not have effect unless it is confirmed by an Act of the Oireachtas.

The Bill now before the House is the Confirmation Bill which is necessary to give the force of law to the Order. Deputies are aware that proceedings have been initiated in the High Court seeking, inter alia, a declaration that the Restrictive Trade Practices Act, 1953, the inquiry held by the Fair Trade Commission in regard to the supply and distribution of radio sets, and the Restrictive Trade Practices (Radios) Order, 1955 are unconstitutional. The hearing of the action has not yet commenced and I do not wish to say anything that might be regarded as prejudging the hearing, but I consider that, having regard to all the circumstances, it would be proper that the Oireachtas should proceed with its consideration of Bills for the confirmation of the Orders relating to restrictive trade practices.

In the case of Confirmation Bills of this kind, the arrangement is that the Order, which it is proposed to confirm, would not be capable of being amended by the House but would be accepted or rejected as it stands. The matters dealt with in the Order have been the subject of a detailed public inquiry by the Fair Trade Commission and the arguments in favour of adopting the provisions embodied in the Order are set out fully in the commission's report. I have no hesitation in commending to the House this Confirmation Bill which, on enactment, will, I hope, put an end to unfair restrictive practices in the trade in building materials.

Mr. Childers

As the House is already aware from the speech made by the former Minister for Industry and Commerce in connection with the first of these restrictive Orders, there is a very large measure of agreement among all Parties that we should do our utmost, not only to stimulate fullest production here, but to loosen and encourage forces of competition in our midst. We are all aware that the distributive system here is far from perfect in many respects, although it has grown as a result of historical and other developments, and that any changes to be made in its character are extremely difficult, if not impossible, in many respects, to effect. Therefore, it should be unnecessary for us on this side of the House to comment in general on restrictive practices Orders, because we have already given our general views on this matter.

It is quite evident that here and in other countries efforts made to secure the territorial distribution of materials used in building, with a view to securing higher profits, are entirely objectionable, but we want to make certain that there are, in fact, no savings in costs effected by such territorial distributions or no evidence that this system of distribution ultimately results in savings to the consumers which might be lost to them. Equally, the arrangements to maintain the rate of profit and to maintain a system of prices in the case of certain commodities can simply result in a lack of competition and prices not being at the very lowest point when the materials enter into building construction. Equally, there are practices abroad in which certain types of distributor make a commission on the sale of materials. They do very little work, or assume very little responsibility, the commission accruing to them automatically. In certain cases, they have not even assumed the responsibility of having either to merchant the goods or effect the transport.

In connection with this Order, there has been the observation of the commission that they are satisfied that, in certain cases, there are too few merchants for various products. It is very important that we on this side of the House should offer constructive criticism and, above all, that there should be a record in the deliberations of the House of the opposite point of view. In other words, just as the former Minister for Industry and Commerce expressed the views of the wireless dealers in certain respects in regard to that Order, so the Minister will understand that, although we would generally agree with the terms of the Order, it is just as well to say a few words about some of the views that have been expressed on this Order.

I should like to ask the Minister very definitely whether he thinks that, in fact, in respect of a very large number of these building commodities, there are at present too few merchants and whether the Order is going to have a particularly valuable effect in increasing the number of merchants? We quite understand that the Minister wants, as we all want, maximum competition and the lowest possible prices, but there is a certain amount of evidence that, if anything, there are too many distributors of some commodities, the result being that the costs of deliveries and costs of accountancy increase to a point where the savings effected by a very wide measure of distribution are lost. I should like to ask the Minister whether he is satisfied—and, in particular, whether he is satisfied from what he can read in this commission's report —if that question is of very great importance.

As I have said, the Order could still have a great deal of value, while the particular statement might not be entirely true of certain commodities. I think it is time we should say in connection also with this second Order that the Minister is surely aware that there are other forms of restriction in connection with building and in connection with construction and manufacture in general. There are restrictions in connection with the conditions of workers and I should like to ask the Minister whether he has had any opportunity of examining them sympathetically, but nevertheless with a view to securing the interests of all sections of the community?

Mr. Norton

That is excluded from the terms of the Act.

Mr. Childers

I understand——

Mr. Norton

And deliberately excluded by my predecessor when it was raised.

Mr. Childers

I quite understand that. I am merely asking, in passing, whether the Minister has begun any examination of that. I also want to ask the Minister whether, in connection with this Order, he has made certain that the absence of collusion, however undesirable it may be, may reduce the total amount and value of applying new techniques to the building trade, whether, as a result of the competition that is now going to take place, if the commission's views are right, there will be a sufficient amount of money to ensure examination of new techniques, sufficient to spend in advertising new techniques, in teaching builders the value of new techniques, in enabling them to have sample stocks of new forms of materials, and enabling them to have samples of new building machinery and appliances; and whether he is certain that that work will continue.

As the Minister knows, the efficiency of building varies very widely throughout the country. There are places where one can see, say, 100 houses being built with a very great absence of modern labour-saving machinery, with a consequent increase in the cost of the houses: there are other places where one can see half-a-dozen houses being built and already some of the newer techniques are being adopted. It has been suggested by the Builders' Providers' Association that part of the financing of that work was done as a result of the quite deliberate policy of price maintenance and price collusion. I should like to ask the Minister whether he thinks that part of the work will continue. I am not willing to state that the builders' providers were carrying out or entering into new techniques for the sake of the country: they were doing it as part of an incentive for their own business, but I am asking if the Minister thinks it will continue and what he proposes to do to ensure that it will continue.

I should also like to ask the Minister, again in a general way, as we are now dealing with a particular aspect of a particular practice, whether he has made any investigation, through the Minister for Local Government, as to how far the method of issuing grants for building houses by local authorities has the effect of increasing the price of houses. It is a matter on which we have had very little debate in this House; it is a matter which, in many respects, is of quite as much importance to the future of the building trade as the implementation of this Order. I should like to ask the Minister whether the Minister for Local Government has been asked by him to make any investigation into that, as it might be found to be of very great importance, if we are now trying to ensure reasonable competition, lowest possible prices for the best possible articles and generally enhanced efficiency.

We have noted that, as in the case of the previous Order, there is a section which enables suppliers to make certain conditions with their customers in connection with the sale of goods, and, just as the former Minister for Industry and Commerce, when he was speaking on the Wireless Order, emphasised that we on this side of the House were keener on the working of restrictive trade practices Orders in relation to collective arrangements, and thought that individual suppliers should be given a fair measure of freedom for the sale of materials to their customers, I take it that the Minister will advise the commission to take a reasonable attitude in regard to such regulations as are made. In other words, the supplier must be assured that his customer is credit-worthy; that he will keep within stocks; that he will be able to render technical and other services to those who purchase from him; and that equally he has a right to see that there are not too many customers in an area, with a consequent increase in distribution costs, rather than a reduction in the cost to the final purchaser.

Equally, I think, the supplier is entitled in the case of a number of products to insist on certain local advertising obligations on the part of the merchant whom he serves. If the sale of a particular commodity requires advertising to be done co-operatively on a basis on which the local merchant enters into all responsibility, the Minister should see that a reasonable attitude is adopted in regard to all these matters.

I should like to ask the Minister whether the allegation made by timber merchants that, taking it on an average even in peace time, timber being a sufficiently valuable commodity, collective arrangements for buying timber through the distribution channels might actually maintain the price of imported timber at a lower level. That was stated and I should like to have a very definite refutation by the Minister of it. I should like to ask the Minister for an assurance that that is not now the case and that the free purchase of timber by merchants and freedom of distribution will not have any effect in raising the price of imported timber.

Let me deal in somewhat more detail with the Order. I noted the observations by the cement distributors. I think that there again in the interests of democracy—I am quite sure the Minister must fully understand the whole position—I should like to ask the Minister what is his opinion on some of the observations made on this particular Order. We were told that only six out of the 680 cement handling firms gave evidence to the commission. It was suggested that although the commission, in their own wisdom, believed they received adequate evidence from these six, perhaps the six did not reflect to a sufficient degree the views of the very large majority of members. I should like to ask the Minister what his view is about that.

In connection with the cement distributors' observations, it was stated that the cost of cement to local authorities was increased by the intervention of distributors. On the face of it, that would appear to be the case. The reply of the cement distributors was very definite, that, in a very large number of cases, they had to arrange for the transport of the cement, that it would cost the local authority so much —this apparently applies to other building materials—that there would be no total net saving to the local authority.

The interests concerned both in cement and other materials said that the local authorities in many cases were not prompt payers and were, in fact, financed by the distributors, and that that had not been taken into full account by the commission when they decided there would be a net saving to the whole community by the issue of this Order and the effect it might have in regard to the amount of cement and other materials sold directly to local authorities, as distinct from being sold through distributors.

It is impossible to make any comment on that. We would want to have a vast array of facts and figures in regard to the credit offered to local authorities, the amount of commodities they bought direct, the percentages of commission received by the distributors and a number of other matters on which there is very little evidence in the actual report of the commission in its abbreviated form and in connection with which it would be impossible to gain evidence upon which to make a final comment.

It was alleged, equally, that the actual profit to the distributors, in the case of cement, for example, was only 3.9 per cent. on cost and for that they had to carry out a very great number of services, including the giving of credit. It seems very difficult to imagine how distributors were able to make very much profit on that basis. The observations of the distributors in that regard are inadequate.

The final statement made is one which is of real interest to the House. A number of these distributors said that the effect of this Order would be to increase the proportion of a number of building materials sold to local authorities and to large users to the point where it might reach one-third of the total, that, therefore, the distributors would be left a much smaller share of these various building commodities to distribute and that, as a result, their costs would go up proportionately and, as a further result, their margins would have to increase. In other words, there might be some saving to local authorities and other very large users through buying direct from manufacturers, and there might be, according to the statement made here, as great a loss, because the distributors with a lower turnover would have to increase their margins, and doubt was expressed as to whether there would be any great net saving to the community.

It is utterly impossible for us to make any comment on that. It is equally difficult to make a comment on the effect of altering the incidence and the extent of credit as between one type of distribution channel and another. Statements were made that if this Order were carried out thoroughly and if it were enforced, there would be a disadvantage to the smaller and an advantage to the larger interests in the business and that the Minister's desire to ensure a more equitable distribution, greater competition, lower prices and greater incentive to sell cheaply and efficiently might be partly offset by the changes that would take place in the channels of distribution and as a result of the alteration in the credit structure of the whole of the distribution of these commodities.

I trust I have made myself clear. This is a most difficult matter to discuss because we have not got the detailed facts. The Minister will understand that if there is a big change in the method of distribution, so that a very great proportion of a particular commodity is sold direct to large users, there will be some effect on the business of the smaller distributors. That is clear. It is equally clear that if one group of distributors have to give larger amounts of credit than they had to give before, in connection with the sale of various products, the effect equally on them will be that their price margins will have to increase, so that there may be a disadvantage to all concerned. I am merely making these statements in order that the views of those concerned with this Order may be given some ventilation in this House and so that the Minister can have an opportunity of replying to them.

There were also suggestions made that there would be a diminution of stocks in connection with certain materials, due to the application of this Order. The suggestion was made by the Builders' Providers' Association that it might hinder the distribution of new and untried products, that it might possibly decrease the variety of the products available in certain small centres. Some of those things have equally been said by interests defending collective price arrangements abroad. They may have no validity whatever.

My fear is that, whenever we engage in legislation of this kind, in the long run, we will always find disadvantages we never anticipated. No legislation of this kind can ever be perfect; it breeds its own difficulties. It is difficult, as the Minister knows, to enforce such an Order. There may be various methods of escaping some of the regulations of the Order, and it is because, by long and bitter experience, one knows there will always be contrary arguments to every type of statute which attempts to do good that I am putting forward these suggestions to the Minister, in the hope that they can be discussed in the House and that we can have an effective reply to most reputable organisations who claim, for example, that the price of commodities as compared with that in other countries has not shown any increase as a result of the Order.

I should like to have the Minister's reply to that also. It is a very serious statement to make that the actual method of price collusion has not resulted in any increase whatever in the price at which the builder was able to obtain building materials here as compared with the price at which he was able to obtain them in other countries. Of course, there are restrictive practices in other countries; there are such practices, for instance, in Great Britain. These are things on which there should be some comment in the House before we proceed to pass this Order and to bring it into operation.

Mr. M.E. Dockrell

There are many aspects of this Bill with which I must regretfully disagree and, being connected with trade myself and with this particular trade, I have the personal knowledge of the matter which perhaps in some ways helps me and maybe, in others, does the reverse; but I would like to give the House the benefit of my opinions, such as they are. First, this method of legislation, which is by confirmation of ministerial Order, handicaps us in considering this Bill. The Bill is a very simple little measure: it has just two sections, but behind that Bill is the Order which was made last September. That is the real bones of this Bill. In fact, it is difficult to discuss that, when the gist of the matter does not appear in the Bill in front of us. I should like to say that I think the Minister has been very fair and that he has, in his opening speech, run through many of the details of the Restrictive Trade Practices (Building Materials) Order.

Still, the effect of this form of legislation is that the House has not the benefit of considering the Committee and Report Stages of the Bill. The Bill is thereby handicapped. In effect, the various paragraphs of this Order are what would normally correspond to the section of a Bill, but, as a result of that, we are deprived of the opportunity of discussing it, and the Bill, as I said before, is weakened by not having our deliberations on those two stages. That is not the fault of the present Minister for Industry and Commerce. I should not like to stand up here behind the Minister and attack him on this Bill.

The Minister is in the position of a man who has had this Bill left on his doorstep by the previous Minister and only last week, speaking on the first of these Orders, Deputy Lemass mentioned that he had deliberately framed the Bill from which this commission and those Orders flow. He said that he had framed it in such a way that these Orders would come to the House in the form of a Bill and that there would be acceptance of it, without any discussion on the Order. I think that is something which is not in the democratic interest and I regret that we have had to carry out this Bill which has had to be introduced into the House in the way in which it is laid down in the Bill, which covers the whole matter.

I am afraid that, when Deputy Lemass was Minister, he did this deliberately in order that the policy of his own Government would be carried out in these Orders and that the House would not be given the opportunity of discussing them. I think that is something which every Deputy and everybody else in the country should be made aware of—that this matter is being discussed in this way because the Bill introduced by the previous Government laid down that it could not be dealt with in any other way. Personally, I think it is a way which hinders the business community from putting their views forward in connection with this matter.

I should like briefly to refer to the commission itself and I do not wish anything I shall say to be taken as in any sense referring personally to the members of that commission. I think they carried out a very difficult type of job in an exemplary fashion. They were polite and painstaking with the witnesses. However, the very form of the commission was one which, of necessity, operated against the business community. It operated against the individuals who were giving evidence. They inevitably felt they were in the dock. In order to arrive at the maximum of information, the commissioners themselves were inevitably bound to take on something of the qualities of a judge advocate. There was a form of questioning by commissioners who have, at any rate, quasi-judicial functions. I have seen the commission at work. As I say, I pay tribute to the fashion in which they carried it out, but I do not think that that method is the best way of arriving at decisions concerning commerce and business matters. Therefore, I would ask the Minister to consult his Department as to how that situation could be altered and the commission strengthened and improved. It certainly makes for great difficulties, I think on both sides, in its present form.

I read about the matter and I listened with great interest to the Minister and other speakers who talked about the report. I should like to say that it is not universally held that the regulation and regulating of prices are necessarily against the public interest. That is something that a lot of people in this country seem to accept automatically, but that is not universally held and it is not universally regarded so legislatively by many countries. I am informed that in a number of the states of the United States of America there are, on the contrary, regulations actually against price-cutting.

I should not like to stand here and be taken as advocating any regime of unrestricted price regulation. The whole kernel of this question is that any price regulation, where it exists, should be fair and reasonable. I believe that, in those circumstances, a great measure of good is done to the community at large. I also believe that good is done to the community at large and to business interests by keen competition and, at times, by very keen price-cutting. However, the facts are, as I see them—and I think as many, if not all, of the business people in this country see them—that there must be reasonableness in this matter —reasonableness, on the one hand, in any degree of price regulation and reasonableness, on the other hand, if a person does not hold to that view, in the advocacy of unrestricted price-cutting which, at the present moment, seems to be in many people's minds a very desirable thing. I wish to put forward the viewpoint and the opinion that that is not so.

I would ask members of the House to pose a question to themselves; I have often posed it to myself. I have asked myself: "What are the trades, businesses and manufactures which seem to be profitable, which pay high wages, which treat their staff well and provide very suitable premises and staff pensions"? By "staff pensions" I mean pensions for workmen as well as staffs. What are the businesses and the trades that can afford to do that? I would answer that question quite briefly and say that they are businesses handling or manufacturing proprietary articles where they are selling a product which is well-advertised and which is known to be up to a certain standard, a product which cannot be sold or bought or acquired for less than that price. Behind that article, whether it be a type of beer, a branded type of tea, a suction vacuum cleaner or any of the well-known articles with household names, I would say that if you look at those factories, if you even pass them on the road, you will see that obviously those factories are doing everything in an up-to-date fashion and are obviously paying high wages and have contented staffs. We have only to look round our own country and see the industries which provide first-class facilities for their staffs, which pay their shareholders adequate dividends and which, at the end of the year, are able to make a contribution towards reducing the difficulties of the Minister for Finance. I would suggest to the House that those are firms which, again, are selling a product the return on which is adequate.

Contrast that picture with some of the trades and industries which have free and unrestricted competition especially of a world-wide nature. We know how, in the years before the war, in the neighbouring island, not only were certain trades hit very severely by world-wide conditions, but whole districts were hit. Slackness in the steel and heavy industries generally resulted in one town—Yarrow—becoming a by-word in the English language. The reason was that not only was there, of course, a slump in those particular trades, but there was a slump of such dimensions that you could practically give away the stuff that was produced. That meant that there was no money not only to maintain the industry in a proper way, but not even enough to keep up the employment level; there was not sufficient profit.

That is the other side of the picture— the side of the picture which comes to the front when you have free and unrestricted price cutting and competition. I am sure nobody in this House wants to see a situation like that coming back, but we could get a degree of that due to very, very unrestricted competition.

To get down to a particular instance, Deputy Childers in his reply cited the case of cement. Cement is one of the materials which is of enormous importance to the building trade. It is mentioned in the commission's report. Cement is fundamental to the building trade and, therefore, it is a good example to take. This Order will seriously interfere with supplies of cement throughout the country and the commission, because of the importance of cement, dealt very fully with it in the report. They stated that margins were allowed by the Cement Company, and taken by the distributors, in the supply of cement to local authorities and that these distributors in that case in fact performed no important function. The cement distributors have pointed out that they have to deliver to local authorities in the same way as they deliver to anybody else; they have to send men to the railway companies, and so forth; and in due course the local authorities have to pay for the cement.

The commission referred to the credit-worthiness of the local authorities. Now, I would not like to run down the credit-worthiness of local authorities; they are ultimately resting on the rateable capacity of the people in their area, and that is a pretty firm rock for any body or authority to stand on. At the same time, owing to their system of auditing and owing to their methods of getting money in for capital expenditures, there is very often a long period between the actual supply of the cement to and the actual payment for it by the local authority. That is inherent both in our system of financial control of local authorities and our system of giving financial assistance to them. Every Deputy knows that there have been complaints here from time to time of the difficulties which builders have experienced in getting payment. I do not want to labour the point, but some local authorities are not famous for the speed with which they pay their accounts. Now, a very important factor in relation to the supply of cement is the period in which the merchant or distributor gets paid. Deputy Childers mentioned a figure of 3.9 as representing the profit a distributor makes on the sale of cement. I think the Deputy expressed a wish in that connection; I think he asked for some expansion of that statement.

Mr. Childers

I asked whether the Minister was satisfied that it represented a profit, even allowing for the very considerable credit given—three to six months was mentioned. I asked the Minister whether he was satisfied with that statement.

Mr. M.E. Dockrell

I take it that what the Deputy was asking was why the trade handled it at that price.

Mr. Childers

That is so.

Mr. M.E. Dockrell

I can answer that by saying that cement is such a fundamental and important part of the building trade that anybody who purports to call himself a builders' provider or a builders' merchant, or, in fact, has any connection with the building trade, or the supplying of that trade, would not like to be in the position of not being able to handle cement. He will, therefore, supply cement, even when the supplying of it represents a loss to himself. I would not say, of course, that is a reason why any Government should seek, by legislation, to leave a man who is supplying cement permanently in the position of doing so to his own detriment; but the reason why it is handled by the trade is that it is such a very necessary part of the trade.

The commission recommended, too, that manufacturers of concrete products should be supplied direct, so that all manufacturers would be able to obtain supplies on proportionately equal terms. That actually is an oversimplification of the situation, because that statement was made apparently on the evidence of one small manufacturer who said that he obtained his supplies from a registered merchant, with whom he was associated, at cost. There was no other substantiation by other merchants of that and the cement merchants, therefore, feel there is no basis for the commission's recommendation that manufacturers should be supplied direct. Most of the arguments for and against an alteration in the present method are very technical, but, if there is a free-for-all in relation to price, matters will be made more difficult for many merchants, especially for the small merchants, because that will have the effect of reducing the channels of distribution and will leave less credit facilities available; and credit facilities, especially at present, are enormously important. At the moment, a large number of contractors are financed indirectly by the distributors and the merchants; and any interference with that system will not help to keep down the price of building.

The distributors feel that the following results will ensue: the situation envisaged under the Order will create anomalies between the various users and will give new and powerful advantages to some. It will result in an increase in price to many users.

Mr. Childers

Does the Deputy believe that?

Mr. M.E. Dockrell

There will be certain users who will not be able to get credit facilities from the bigger people as they got in the past. In order to spread their trade they will be driven to smaller people who in their turn may have to charge a higher price.

Mr. Childers

Does that apply to other building materials besides cement?

Mr. M.E. Dockrell

I would say so. It is very difficult to say without sitting down and working out the exact channel through which a particular order may go. I referred to another reason, the disruption of present channels of distribution. It would also lead to the non-availability of supplies in places where they are now available, the use of extra staff and labour by users to carry out duties at present performed by distributors and merchants so that the feeling of the distributors is that the Order as a whole would be unworkable, that many of these sections are extremely difficult to interpret, that they cannot in fact be interpreted and therefore would be unenforceable.

I referred to the general effect of price cutting. If you have ever seen one of these cut-price establishments operating, you might get, in miniature, an idea of what may result by the wholesale application of the principles enshrined in this Order. If any of you are sufficiently interested to go and look into one of these establishments, you will see a very ordinary looking shop, inadequately furnished, with no proper counter and with very young assistants serving the public. If you contrast that with any well-established grocers' establishment, with its well-trained assistants of various ages and obviously with considerable experience of the trade and of the articles which they handle, you will get some idea of the difference between unrestricted price cutting and the system operated in a trade which carries on with a degree of price regulation which ultimately is in the interests not only of those in the trade but of the public themselves.

Mr. Desmond

While there are many questions on which I cannot and never did perhaps agree with Deputy Lemass, I am glad to say that on this particular issue I do agree with him. The report of this commission has come before us and if we are to indulge in a free-for-all discussion again, after the time and the money that has been spent on this work through the commission that was set up, it would be of little use having commissions established at all to go into these matters.

Whatever Deputy Dockrell may say, it is a sad commentary on present business methods in this country when we have to admit that in order to expose restrictive trade practices we have had to set up a commission to show to us in a fair, honest manner, as they have done, what the builders' providers have been doing over the years. As one of those at the other end of the stick, so to speak, in relation to building, I can say that this report was long overdue. If we had more time, as Deputy Dockrell said, to go into detail, perhaps we could expose a great deal more.

The question of credit, which has been mentioned by two previous speakers, was much less difficult in the building trade before the outbreak of war in 1939. In fairness to the builders' providers let me say that they gave more fair play then than they have given since the commencement of the war. It is because materials became so scarce, because they and their travellers were able to select their customers throughout the country, that they came to realise how much the years of the war meant to them and had reason to hope that they would never have to return to the pre-1939 situation.

As Deputy Barry and other Deputies are anxious to speak, I will not delay the House except to say that we of the Labour Party welcome this report and congratulate the chairman and the members of the commission on the manner in which they carried out their work and presented that report. Please God, as these matters are being shown up to the whole community, we may soon return to a system of business and commerce whereby we will not have to adopt continuously the procedure of having commissions set up to expose certain methods of business that should never have been introduced into this country and which I hope, as a result of this report, will be obliterated at the earliest possible moment.

Mr. A. Barry

My colleague, Deputy Dockrell, said it was not possible to deal with this matter as clearly as he would like, because it required excessive simplification. I think this matter requires to be simplified because there are elementary principles involved here which should be stated and restated in this House. Deputy Childers referred to it, inadvertently I think, as a restrictive Order. It is the opposite to that, of course. It is a freeing Order.

Mr. Childers

It is very hard to keep that name straight.

Mr. A. Barry

I guessed the Deputy had read it hastily. We have a con dition in this country at the moment where we are embarking on a line of public activity that is due to history. We are engaged in a great deal of public construction work—hospitals, public buildings, road-making and bridges—and engaging in very considerable housing activity. The costs of the materials we have to buy for these things is, of course, vital. I have been disturbed to find a very considerable unevenness in the costs of building supplies in the city of which I am a councillor. I have found that it is possible to build a house at varying rates in this country and the city in which I live does not compare favourably with others. I have found also that, where we engage in direct labour projects and purchase supplies ourselves and upon our own price basis, it is sometimes possible for us to bring articles many hundreds of miles from the other end of the country although we have very adequate and rich commercial institutions, builders' providers, in the City of Cork. That is a disturbing reflection.

I believe it is very closely related to conditions in the rather well-tied-up trade that this trade is. I can only repeat what I said when the Minister was bringing in a similar Order here last week. That is that we have got to accept the idea that business should be a free-for-all and that any restriction upon its activity is a movement in a direction away from what we understand to be free enterprise. Any kind of a restriction on prices is a movement away from free enterprise and we might well injure the community by such measures unless we desire to proceed the whole journey to Communism, in which there is complete regulation of everything—the sources of supply, prices, operating activities, and the work in which we engage. Unless we move in that direction, which would be a logical extension of this kind of control, I think we had better say that the quickest way out of it—and I think in this case over-simplication is valuable—is to decide that no regulation of any kind be permitted except that undertaken by the State to protect the public.

My experience in over 40 years of business is that any kind of canalising of supplies is bad in the ultimate and it makes the consumer pay more. Deputy Dockrell referred to the kind of trading which has always been known as cut-price trading. It is particularly bad in my trade, but I am willing to admit that, although the cut-price institutions—and some of them have gone beyond the stage of being the back-room place, ill-dressed and with ill-paid employees—have grown into bigger businesses, the very existence of these places does have a controlling effect on the general price level. I would be a hypocrite if I did not state that. I have had price cutters operating beside my own premises. Sometimes they went out of business rapidly, and some of them grew into very big businesses, but they started off by selling goods which were referred to last week as loss leaders—selling a tin of salmon, for instance, practically at cost price. It did mean that we eventually had to reduce the price of tinned salmon to the public, and the public got cheaper tinned salmon. I think the principle of free enterprise is fully justified in that case.

Competitive business is always a very finely balanced thing. There are no rules about it. That kind of balance, that stress and flow of competition, that occasional loss and occasional good profit, is the essence of trading. Deputy Allen knows well that, if he goes to a fair and there are very few men with produce to sell while there are a number of buyers he will probably get a good price for his beast. On the other hand if there are a number of sellers, the buyers will do well. It begins and ends in that kind of picture. People who would try to upset that fine balance of trading, that continual stress that should take place under a free capitalist system of society, will in the first place injure some of their competitors but they will undoubtedly prevent the entry of fresh competition and will injure the consumers, and the consumer is the community. We have only to look across the water and we can realise how worried is the great community on the other side of the Irish Sea about this particular problem. They feel that the consumer is being injured by the development of this kind of thing by businessmen. The consumer is the community and this House must protect the community. I think this Bill seeks to do that.

Mr. Norton

In general, this Bill has received the same kind of reception as its predecessor—the Bill dealing with the radio trade—and I think it may be taken that, generally speaking, here again the House faced with the problem of deciding what it should do in regard to this difficult problem, has come down very definitely on the side of protecting the community. That is all to the good and I think the previous manifestations of the House's views in that respect should induce those who are still engaged in restrictive practices to mend their ways, with the aid of the Fair Trade Commission, so that it will not be necessary for the House to go through a whole collection of legislation dealing with a whole variety of trades because, if the House has indicated clearly its views, that ought not to be necessary.

Deputy Childers raised some questions arising out of this report and asked a number of questions, some of which would require access, which I have not got, to the transcript of the evidence of the Fair Trade Commission. The Act itself provides that the commission shall be established to do a particular task. The commission was set up under statute. It was charged in the statute with bringing in a report and this is the report which it has presented. Deputy Childers has as much information in this matter as I have and he and I must try to apply whatever intelligence we have to ascertaining whether the report, as we have received it, justifies the course of action which the commission recommends.

There is no doubt that this matter has been fully examined by the Fair Trade Commission. On page five of the report it is stated that public sittings were held on 27 days in the period between 7th December, 1953, and 18th May, 1954. So that nobody can say that the hearings were not fully advertised and an adequate opportunity given to the persons interested to present their evidence. It is stated also on the same page that:—

"Evidence was taken from 132 witnesses and all witnesses were examined on oath. A list of the witnesses is given in Appendix A. They included manufacturers, merchants and agents, builders, building contractors, architects, quantity surveyors, officers of certain local authorities, officers of the Federation of Builders, Contractors and Allied Employers of Ireland and of the Federated Union of Employers and officers and members of the following associations connected with the supply and distribution of building materials and components."

Then there is set out a formidable list of the people who were concerned with the supply and distribution of these materials and component parts, totalling 16 in all. It is also indicated on the following page, if that were not sufficient, that counsel and solicitors appeared on behalf of a number of the witnesses and the Federated Union of Employers appeared on behalf of all the associations mentioned in the preceding list with the exception of three which are specially marked.

So that, so far as the Fair Trade Commission was concerned, everybody had abundant opportunity of putting forward the case. Not merely were officers of the various associations heard, but solicitors and counsel and other experts were brought in to make sure that the viewpoint of those affected by the inquiry was fully heard by the Fair Trade Commission.

Having heard all these views, the commission presented this report. The commission consists of three persons who have no association with this trade and are in the position of being absolutely neutral in their objective approach to this problem. As a result of their deliberations and anxious consideration of the evidence, we have this report. The report recommends that in the public interest this Order which I have made should be made so as to ensure that the public will be adequately protected.

I am sorry Deputy Dockrell has left the House because, listening to him this evening, I rather got the impression that the world is indebted to price rings for avoiding many catastrophes. I am sure that will be news to humanity. Deputy Dockrell told us this evening that the facility of getting a small number of people together, concentrating all the business in their hands, who select to whom they like to supply goods, fix their own profit margins and generally establish a closed shop to a highly intensive degree, has saved a lot of people a lot of headaches and saved them going into a whole lot of little accountancy details with which they should not be annoyed. He did not say in whose interests all that was being done. Let us see what the commission says about it.

On page 30, paragraph 45, the commission say:—

"It is obvious that any body of merchants, in fixing gross profit margins, will primarily consult their own interests, and since merchants stand to profit from transactions with the public, their interests need not necessarily coincide with the public interest. The more comprehensive the association the greater the risk of excessive margins being fixed. Effectively the only limiting factor in the fixing of margins by combinations of merchants is the fear that a very high margin may lead to price competition, particularly if there are important merchants outside the association."

Listen to this carefully:

"The minutes of the meetings of a number of associations contain statements at different times by members that the prices or margins were too high. In the case, for instance, of one very important commodity, a merchant with wide experience in the trade concerned is recorded as having strongly expressed the opinion at one stage that the price of the material had been fixed at too high a level and should be reduced. His view was not accepted by the association. Another merchants is recorded as having stated in connection with the same material and with reference to a quotation to a local authority that ‘on recent occasions he had observed that it appeared to be the practice to price such inquiries as high as possible'. The magnitude of the trade is such that even a small excess in the fixed margin over the average realised margin that would emerge in conditions of competition would amount in itself to a very substantial sum over a period of a year."

There you have the minutes of an association revealing that some of the members, who are organised in that association to fix these margins, were suffering from such introspection about the margins they were taking that a number of them expressed the view that the margins were pitched too high and should be reduced. Is it not obvious to anybody who has the most cursory acquaintance with price rings, that the whole purpose of these associations and rings is to keep them as small as possible, to fix the highest margins they can get from the public and generally to take all necessary steps to protect themselves, even if the protection of themselves involves doing serious disservice to the community?

Deputy Dockrell gave the impression that if anything interfered with this price fixing and these price rings, serious damage would be done to the whole trade and that, in fact, they might not be able to provide for those whom they employ some of the amenities which he says some of them now provide for their employees.

At Appendix B on page 143 of the report, one finds a table under the heading: "Particulars of turnover and employment of 81 establishments classified under the heading of Builders' Merchants and Providers in the Census of Distribution, 1951." Particulars are set out there of the sales and it is shown that in this particular group of shops, numbering 81, the sales were £13.3 million; gross trading margin as a percentage of sales was 17.6. That is not doing badly—17.6 margin over a range of 81 shops covering £13.3 million.

Mr. Briscoe

Did the Minister say net profit?

Mr. Norton

Gross trading margin. The net profit is not stated there. When that is tied up with the protestations of two members of this association that certain prices were far too high, one gets a relationship there which is at least understandable even if it is not altogether explicable. The commission's report in paragraph 45, the evidence in Appendix B and the general experience of the House will convince it that the case for the abolition of these price rings has been more than made.

What I find difficulty in understanding is that persons should try to make a case for this resale price maintenance. In circumstances where a person buys goods, has paid for the goods, which come completely under his ownership, somebody else, who has nothing to do with the goods, who does not own the goods, purports to tell him that if he does not sell at the price fixed by the non-owner he will get no more goods. Take an example. Take any type of building material you like, which is ordered by a small merchant, either from a manufacturer or from a supplier. The merchant orders the goods; he has got them on his premises; he has paid for them; his ownership of these goods is absolutely undisputed, but either the supplier who has been paid and who has no title to the goods, or the manufacturer, through the operation of these price rings, purports to say to him: "You must not sell these goods, unless at prices we prescribe." The retailer owns the goods, but he would not be allowed, under the conditions governing the supply of these goods, to sell them even to a relation at less than the fixed price. Either the manufacturer who has been paid for the goods, or the merchant who has been paid for them, claims to have the right, under this system of rings, organisations and associations, to prescribe the selling price of an article in which he then has no interest whatever.

Can anybody attempt to defend that —to defend the right of somebody who has no ownership of the goods to fix the price at which these goods must be sold and prescribe the penalty for not doing so, so that the trader will be put out of business, because he will not get any more goods to sell, unless he complies with the edict of the man who has no title to the goods? Deputy Dockrell did not apply himself to an examination of the morality of that proceeding. I certainly hope that we will hear somebody trying to defend it because opposition to a Bill of this kind involves defence of a principle—if you could regard it as a principle at all— of that nature. The view of the commission and the view of this House is that when a person owns goods, a trader of this kind, he should be allowed to prescribe the selling price of the goods. That is in the public interest, and that, I think, is the principle for which this House wants to stand.

Deputy Childers has raised a number of matters largely of an interrogatory character, some of which, I think, are quite outside the scope of the inquiry and my functions. The Deputy asked if I had considered the question of restrictions by workers. My predecessor took the view that whatever restrictions may exist could not be effectively dealt with in a Bill of this kind, that whatever the remedy is it must be found outside the scope of a measure of this kind and that it would be far better to hope that whatever problem exists there would be examined and solved by those who are concerned with the organisation of workers.

Mr. Childers

Hear, hear!

Mr. Norton

Similarly, I have no function in the matter of the effect of this price fixation of building costs on building methods, but certainly the builders' suppliers have no function either, and I have no knowledge that they have ever exerted any function in regard to finding any new techniques. I think Deputy Dockrell—and certainly Deputy Childers from another angle— raised the question of those new techniques, but I am sure it will be agreed that it would be an extraordinary thing to allow excess profits to continue, in the hope that they would be used to finance research into new techniques. If that is the only argument for price rings, it is the poorest one I ever heard. In fact, it is normally the manufacturer of articles who is interested in investigating the market and settling the distribution of new techniques, and I do not think there is any justification for permitting the continuance of price rings in the erroneous belief that the merchant who is part of the price ring has ever devoted much time to an examination of new techniques dealing with problems concerning the trade to which he is selling goods.

Deputy Childers raised the question of timber. I think he fears that this Order would prohibit collective purchasing of timber. That is not so. Those who want to purchase timber collectively are not prohibited from doing so, but they are prohibited from collectively fixing selling prices, or collectively conspiring to keep out new merchants.

Deputy Dockrell raised the question of prices and all the work that these associations were performing in the field of price regulation and so on, but the Deputy did not once ask himself why is all that done. I think there is only one answer to that and that is that these associations undertake to do it for their own substantial reward and are anxious that these arrangements should be made in respect of prices, because, if there was no regulation of prices, they saw the possibility of running entirely into price cutting and a situation which would give them profits which would not have yielded the 17 per cent. gross margin on sales which is set out in Appendix B on page 143 of the report.

Deputy Childers, I think, raised the question of the position in relation to the granting of credit. This Order cannot require additional credit to be given to any trader. The supplier of the goods is entitled to fix his own credit terms. The receiver of the goods cannot fix the credit terms and the supplier of the goods is entitled to fix them. He is obliged, of course, to be generally reasonable and equitable, as between one person and another, but he cannot be asked to take on dud customers or keep people on who will not pay their accounts. He is entitled to fix whatever he thinks stands the test of reasonableness in that respect.

Deputy Childers referred to the position of Cement, Limited, but that does not arise under this Order at all. The commission merely exhorted Cement, Limited, to change their arrangement so as to allow in new merchants who could make the grade. The Order makes no provision about this, but, if Deputies will look at Chapter 20 of the report, they will see that Cement, Limited, are under notice that, if and when they file their terms of sale under Article 11 of the Order, the commission will presumably take the view which they take in Chapter 20. That is the only extent to which this report deals with the position of Cement, Limited.

I do not believe this Order will in any way increase prices of distribution of commodities merely by allowing more people to distribute them. The present scheme of distribution was one designed to allow the minimum number of people to distribute and to keep out everybody else as far as possible, to fix the highest possible margin of profit—profit margins which drew from two merchants of the association as recorded in the minutes of their meetings a protest that these margins were too high. I think a wider distribution of articles, abandonment of resale price maintenance, fixation of fair rules of trading and a getting-away from the philosophy and mentality which has produced these price rings must, in the long run, give us freer and fairer competition. If I have to make a choice between free competition and fair competition as against a price ring fixing prices, then, in the public interest, I must come down on the side of free competition and fair competition. I am glad to see that the views of all Parties in the House, as expressed on this Bill and its predecessor, have been on the side of free competition, fair competition, and a fair deal for all and that approach has been designed from the standpoint of protecting the community. I commend the Bill to the House.

Question put and agreed to.

Agreed to take remaining stages now.

Bill put through Committee, reported without amendment, received for final consideration and passed.