It seems as if we are going to keep the Dáil going today as well. I was replying to the Second Stage debate, which was a reasonably lengthy debate and not unusually so in that the whole position of trading stamps and the regulation of them is a matter of concern to all consumers. The point had been made by Deputy Barry Desmond that trading stamps should be prohibited rather than regulated, and most of his comments on the Bill were based on the fact that anyway he did not agree with trading stamps, that they should not be there and if he was in my place he would be getting rid of them. He agreed with me that we could not discuss a lot of the points made on that basis.
It has been certain for a long time that the features of the trading stamps scheme have presented most of the problems down the years. The problems are low cash redemption value and indiscriminate alterations in exchange values in catalogues. It is these features as distinct from the schemes themselves that have presented the problems and the desired objectives could be achieved by controlling those aspects of the business rather than going to the extreme length of prohibition itself. All the information that we have would suggest that the consumers are disposed favourably to trading stamps. Deputy Enright made the point that they represent a method of saving. Consumers go to a place and buy something and get a number of stamps and they feel that this is a saving they are not making intentionally, it just happens incidentally, as it were. The consumers are disposed favourably in particular to the redemption of stamps by goods. The stamps provide consumers with an alternative means of obtaining some luxury items which normally would not be available to them.
The provision in the Bill which makes it compulsory for a trading stamps company to redeem for cash trading stamps with an aggregate cash value of not less than £1, and particularly the provision in section 6 which enables the Minister by order to prescribe the cash redemption value of trading stamps when he feels they are too low vis-à-vis the redemption value of the goods, will enable the Minister to control indirectly the profit level of trading stamps companies where he feels that excessive profits are being made at the consumer's expense.
Deputy Enright also made the point that there is a need to ensure that only reputable firms are the promoters of trading stamps schemes. Whether a firm who are a promoter of trading stamps schemes are reputable really can be assessed only after the company have commenced business. However, section 2 of the Bill is designed specifically to ensure that only a firm in corporate form with a place of business within the State will be enabled to carry on a trading stamps promotion business. This will ensure that proper auditing requirements and standards in relation to the firm's accounting will be maintained. It will ensure also that the Minister can investigate their affairs if, for example, fraudulent dealings are suspected, and it will ensure also that the delicate areas of business such as loans to directors can be regulated.
In addition, the general privilege provided to private companies exempting them from the requirement to annex certain documents to their annual returns is being taken away from a private company who are promoting a trading stamps scheme. This will ensure that the buying public can have access to the essential facts about the promoters' financial state and the likelihood of their remaining solvent. If the privileges which are conferred on private companies generally were to continue to be enjoyed by private companies engaged in a trading stamps scheme the buying public would be frustrated from having access to the essential financial facts. One of the main purposes of making it unlawful for any person other than a company to operate a trading stamps scheme would accordingly be defeated. As Deputy Enright suggested, it is envisaged that regular checks would be made in the companies' offices to make sure that companies involved fulfil their obligations under the Companies Act.
One Deputy made the point that there is a need to ensure that stamps are not witheld unreasonably from those wishing to partake in a trading stamps scheme. This is one of the features in the scheme in its present form that is most disturbing to consumers and to the commission as well. Section 3 of the Bill caters specifically for this contingency. It states explicitly what is already implicit under the Restrictive Practices Act, 1972, that any person who considers that trading stamps are being withheld unreasonably from him has a statutory right to have his grievance investigated by the restrictive practices machinery. Criteria for assessing that the withholding of stamps is unreasonable are laid down in the Bill. The fixing of criteria which would be applicable universally is not possible because their determination clearly can depend so much on the circumstances of individual cases and, therefore, it will be a matter for the courts to decide. However, the investigative machinery available under the Restrictive Practices Act enables the different circumstances of various cases to be taken fully into account.
The point was also made that the alteration of catalogues and the alteration of the number of stamps required for particular goods so often by a company often meant that a consumer who had saved stamps for a certain length of time—probably it had taken a considerable number of weeks for the stamps to accumulate—in order to exchange them for the product advertised in the catalogue, on going to redeem the stamps was told at the desk, "We are sorry, but you need X number of stamps more than you have. The catalogue has altered in the meantime". Definitely this needs to be regulated, and sections 6 and 7 of the present Bill regulate the content of the catalogues, the period of their validity and the procedure which must be gone through before their exchange values are altered. If the worth of stamps is to be indicated in merchandise so that rational comparison can be carried out and exaggeration prevented, a prerequisite will be that adequate information in relation to the goods offered in exchange, the number of stamps for which each item will be exchanged, the name and address of the registered office of the promoter and the date on which the catalogue will cease to be valid should be available to the stamp holders. These are essential pieces of information which are clearly of the greatest importance to the person who is collecting the stamps.
In relation to the period of the validity of an existing catalogue this will be at least six months after the date on which the catalogue became operative. This date will have to be announced by a promoter in at least one daily newspaper which circulates throughout the State. At least one month's notice will have to be given of a proposal to change a catalogue.
A point was made that there is a need to ensure that the implied terms, such as fitness for purpose, merchantable quality and so forth, which are inherent in every contract for the sale of goods, are equally applicable to contracts involving the redemption of stamps for goods. Section 8 of the Bill provides specifically that the implied conditions and expressed and implied warranties in every contract of sale contained in the Sale of Goods Act, 1893, will apply equally to goods redeemed for stamps as to goods purchased for monetary consideration.
The point was made that it was important to educate consumers in relation to trading stamps. I have often said in the House that it is important to educate consumers on all aspects of consumer legislation, which is what the Trading Stamps Bill would come under. This will be a matter in the first instance for the Director of Consumer Affairs, but educating consumers in something which we all can lend a hand in. I do not believe it can be said often enough that we should warn consumers against purchasing or becoming involved in a contract which may seem to be a bit doubtful. This can be said about trading stamps and it can be said about all sorts of purchases consumers make at any time during the course of their lives. You can legislate and you can bring in all sorts of legislation to protect the consumers, but you can never legislate for what the consumers will do in private matters. Deputy Desmond made a very reasonable comment in that regard on another Bill some weeks ago.
The point was made that the penalty ceiling for minor and major offences was too low and that no provision is made for continuing offences. The Bill creates various offences, both summary and indictable, major and minor, and the various penalties laid down are tailored to what is a subjective assessment of the seriousness of the offences involved. I am sure that Deputy Enright, who is a member of the legal profession, will agree with me when I say that the level of penalties included in the Bill are fairly standard for criminal legislation. There is no reason to believe that the activities of trading stamp businesses need to be more stringently controlled. The courts, in regard to both the Consumer Information Act and the Trading Stamps Bill, will always be aware of whether the offence involved is a second or a later offence and could within the upper limit for both summary and indictable offences impose heavier penalties at the court's discretion. It is the Government's intention that the provisions of this Bill be strictly adhered to and that proceedings will be promptly instituted for violation of its provisions.
I believe I have covered most, if not all, of the points that were discussed during the course of the Second Stage. I would like again to thank the large number of Deputies who took part in the debate and to say that I hope the Bill will receive favourable consideration.
