Dáil Éireann debate -
Wednesday, 1 Apr 1981

Vol. 328 No. 4

Private Members' Business. - Retail Grocery Trade (Special Provisions) Bill, 1981: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. O'Donnell

At the outset I wish to congratulate Deputy O'Toole for his enterprise and initiative in formulating the Bill before the House. This Bill, which has the full support of Fine Gael, is a timely, logical and realistic response by this party to the very serious problems that confront the Irish grocery trade at the present time. It is designed to apply the necessary corrective measures that are urgently required to reverse what can only be described as a continuing catastrophic trend in the Irish grocery trade. I submit that if this trend is not checked the indepandent operators, who have been an integral part of the economic and social life of the country, will be wiped out by the end of the decade.

Fine Gael fully support the independent wholesalers and retailers in their fight to prevent an even greater proportion of the nation's food distributing industry falling into the hands of a few companies. We are very concerned at recent trends in the food retailing trade, trends which if they are allowed to continue unchecked will lead to a concentration of power in the hands of a few companies. Let there be no mistake about it. The law of the jungle, where the strong kill the weak, has been operating, is operating and will continue to operate in the Irish food retailing sector unless corrective action of the type recommended in this Bill is taken.

The law of the jungle is operating in this area. We have seen the advent of powerful multinational combines, backed by unlimited finance, entering the Irish retail market. These multinational operators are prepared to invest a considerable amount of money at the initial stage and they engage in all kinds of shady practices such as low-cost selling and so on in order to get a foothold in the market. They are prepared to lose money, and can afford to do so, while they are penetrating the market. At the same time they are putting out of business or are putting at risk many thousands of independent retailers.

It must be a cause of concern to anyone interested in the economic and social life of the country that 8,000 independent grocers have been forced to close in the past decade. This figure represents 50 per cent of the number of independent grocers a decade ago. Unless remedial action is taken on the lines set out in this Bill, it is clear that the independent grocers will be completely wiped out in another decade. I want to make it clear that Fine Gael are determined to prevent that happening. We are convinced there must be some restriction on the unbridled expansion of multiple outlets, particularly the multinationals. Strict measures will have to be taken if we are to prevent further catastrophic losses of jobs and the livelihood of many people.

In addition to the closure of small businesses there are other implications. The trend in the grocery trade has serious implications for the Irish food processing and manufacturing sector. We must face facts. The growth of multinationals inevitably will lead to an increase in food imports and recent figures available indicate a frightening increase in the food products being imported. From the evidence available to me and from reports I have read, I have no doubt that the multinational multiples are contributing to a significant degree to the increase in food imports. Last night the Minister of State, Deputy Gallagher, did not agree that the growth of the multinational multiples had a significant bearing on the increase in food imports but I totally disagree with him. There is ample evidence that the growth in the multiples has led to an increase in food imports, with consequent disastrous results for the Irish food processing industry.

We are not seeking a total prohibition on the opening of new grocery outlets or the extension of existing outlets. We are seeking to ensure that before any such developments take place criteria are laid down that will take account of the common good and the likely effects on existing outlets. Those criteria are spelled out in section 5 of the Bill.

Subsection (5) states:

Without prejudice to subsection (4) (a), the Minister shall, in prescribing the conditions to be specified in a licence, in relation to a 20 mile radius of the location of the proposed retail outlet, having regard to the following:

(a) the distribution of population;

(b) the adequacy of existing retail grocery outlets to service the community;

(c) the likely effect on the trade of the existing retail grocery outlets;

and

(d) the likely effect on employment in that area.

In introducing this Bill we are merely bringing Ireland into line with many of our EEC partner countries, France, Italy, Germany and Holland, who have all recognised the need, in the interests of the common good, to keep a close check on the growth of large scale grocery outlets.

For example, in relation to the situation in Britain, in 1977 the British Government, through their Department of the Environment, published a Development Control Policy Note No. 13 on the subject of Large New Stores. That note set out the current ministerial policy and aimed at giving general guidelines to all those concerned in the operation of planning control. The policy note was published because of the Department's concern at the uncontrolled growth of supermarket development and the consequent effect on the environment and on existing shopping facilities.

Planning Development in France is controlled by the Commission in Charge of Commercial Town Planning. That commission lays down rules, regulations and criteria, somewhat similar to the criteria laid down in Deputy O'Toole's Bill, to ensure ordinary growth and development and to avoid the type of cut-throat competition and the law of the jungle that has been operating in this country.

In Italy, the opening of grocery stores is controlled by licence and in recent years very few licences have been issued. In this Bill Deputy O'Toole is proposing a licensing system.

In Germany applications for planning permission for developments exceeding 1,500 square meters is required under a special law there, which law is administered by the local chambers of commerce. As is the case in Holland and elsewhere, the commercial implications of the development, the community implications of any proposed new developments, the existing services and facilities, are all taken into account. In Holland authorisation for superstore development must be obtained according to the general law on opening stores. That law is administered locally and permission is granted only in areas specifically zoned for supermarket development.

It will be seen, therefore, that many of our European partners have recognised the need, in the interest of the common good, to keep a close check on the growth of large grocery outlets. In this country we have not done so yet. We in the Fine Gael Party have been most concerned about this situation. Indeed it was after careful examination of the situation and of all its implications that it was felt timely that a Bill of the kind Deputy O'Toole has introduced be brought forth urgently.

I greatly deplore the totally unrealistic response of the Government to this Bill. The response to which I refer is that revealed in the speech of the Minister of State, Deputy Gallagher, in the House last evening. I believe that speech clearly reflects the lack of understanding and the amazing, inflexibility of the Minister, Deputy O'Malley, on this whole question. The speech of the Minister of State last evening was remarkable for its prevarications and double-thinking. First of all, the Minister of State did admit that a problem existed but he endeavoured to convey that it was not as great as we on this side of the House seemed to think. Finally, he resorted to the typical ministerial evasive subterfuge, in that he said he had decided to have the problem properly examined. It is a wonder he did not announce he was engaging McKinsey to carry out this examination.

Whatever examination is carried out the end result will be exactly the same. The case for a Bill of the kind we have before the House will be clearly established. The Minister knows this as well as I do, so why waste more time on unnecessary examination of what is a factual situation? The Minister should have the courage to admit that the only answer to the problems of the Irish grocery trade is the forming of legislation to ensure the orderly control of the growth and development of the grocery trade and, most important of all, in the context of this small country, with galloping inflation and appalling unemployment, it must be legislation ensuring the survival of the 9,000 independent businesses daily being placed in greater jeopardy by the uncontrolled growth and development of the powerful multinationals. Many of our EEC partners have recognised the need, in the interests of the common good, to keep a close check on the growth of large-scale grocery outlets. It is high time the Irish Government did likewise.

With due respect to the Minister, I believe he has made a grave mistake in rejecting out of hand the proposals contained in Deputy O'Toole's Bill. I believe this Bill will stand the test of time. This Bill has been carefully framed and can be defended by reference to similar legislation in most of our EEC partner countries. The views of the Minister, Deputy O'Malley, are well known, as is his inflexibility on this and many other matters. I believe that whatever examination the Government carry out it will reveal the validity of and the need for the Bill put before the House by Deputy O'Toole. I ask the Minister in all sincerity, before the conclusion of this debate, to have a re-think, and to accept the validity of and the need for a Bill of this kind.

Mr. B. Ahern

Last week when we had some visitors to the Dáil representing the suffering parties we were all very impressed by their case and sympathised with the problems they are experiencing. From the comments of the Minister of State last evening, it would appear that he does accept a problem obtains. The last speaker put this across very vociferously; that is his job in Opposition, and it probably highlights the difference between having to look at both sides of the coin or just one side without caring about the other. While the small retailers have a problem which must be dealt with there also happens to be many consumers who probable have not enough money to pay for it. The last speaker, and some other last evening, seemed to ignore totally that there happened to be consumers who must pay for these things. It is the responsibility of government to think of both sides while it is the job of Opposition, in advancing an argument, to put forward one side. As far as that goes the last speaker was very successful.

This problem did not commence last week or last year. The figures given by the Minister of State last evening illustrated the massive decline there was in 1966-67, part of the time when the parties opposite were in power and when perhaps the same problems existed. Price cutting went on in the fifties, sixties and seventies, during the period when the first Commission on Restrictive Trade Practices was established to examine the problem. This did not happen just last week, as some people listening to the debate may think and it will not stop next week. To say that the reason for so many retail shops closing down around the country is strong competition is to give only part of the story. Times have changed in every way, and so have consumers and the industry generally — probably because of pre-packaging and the fact that people like big shops, big pubs, big halls, everything big — so the small shops went out of business for a lot of these reasons.

In the part of Dublin which I represent, those shops which changed with the times, extending their premises, have survived. That has not happened in all cases, but some have managed to hold their own alongside some of the bigger supermarkets. They may have to open earlier, close later and open at weekends, but they have matched the competition from the larger outlets in some way. Many reviews under the Fair Trade and the Restrictive Trade Practices Acts over the years have looked at all the problems and the reasons for these things happening. They have continually changed the various Acts to suit the times. The Minister accepts that there is a problem. He said that there would be an inquiry, the terms of reference of which have to be set, to again look into all aspects of supply and distribution in the grocery trade. Surely this is better than taking a hurried action which might be regretted in the long run?

According to the Minister's speech last night, the people in 1955 said that the report of the Fair Trade Commission concluded that price competition at retail level would be beneficial to the public and recommended that individual and collective action designed to ensure the maintenance of retail prices should therefore be prohibited. In Deputy O'Toole's Bill, it is the other way around. It wants to prohibit open competition. Perhaps the people in 1955 were wrong and perhaps Deputy O'Toole was wrong.

Mr. O'Toole

Where is that in the Bill?

Mr. B. Ahern

It is the Deputy's view that we should prohibit open competition.

Mr. O'Toole

Not at all, for goodness sake.

An Leas-Cheann Comhairle

Sorry, Deputies. Deputy Ahern will make his own speech.

Mr. O'Toole

He should not misquote me.

Mr. B. Ahern

If I have mis-quoted the Deputy, fair enough.

Mr. O'Toole

It is not fair enough. That is the problem.

Mr. B. Ahern

My understanding is that if there is price cutting now on one aspect according to Deputy O'Toole that causes a big problem. What people in the shops say is that they see one or two items below cost but the overall cost of the goods is not changing very much. In a lot of cases under-price selling does not exist at all. That it exists in some cases, but not to the extent put forward, is what consumers are continually saying. Deputy O'Toole knows, as well as all of us, that consumers are concerned about the cost of goods. If they can get one or two items below cost which they use in great bulk in their homes, they will go to those shops. That seems to be a fair practice, which Deputy O'Toole may accept.

Mr. O'Toole

I am a consumer myself.

Mr. B. Ahern

Fair enough. There is and has been over the years control under the current legislation. Manufacturers can block or refuse to supply to multinational companies or large concerns if they sell under the invoice price. This does not rule out totally under-invoice price selling, but goes part of the way.

Why try to curtail only the five large supermarkets, perhaps unnecessarily? Perhaps, as other countries have found, it will be necessary in future to bring in extra curtailment on them. The Minister has not ruled this out altogether. He wants to have all the aspects examined and not to hurry into anything.

Recently, in Galway, the Minister for the Environment was looking at the position in relation to one of the large companies opening new premises there. There was a consumers' revolt, at the idea that this shop should not be allowed to open. I agree as much as anyone that multinationals and monopolies should not be allowed in future years to join together, crucifying the consumer. If I thought that that would happen and that further necessary regulations would not come into effect, I would agree with Deputy O'Toole, but I do not think that that is the position. There are controls which can be and have been implemented. The Minister has said that these controls will again be looked into and that an inquiry will take place to see what has to be done now.

At present, five shops in Dublin have about 70 per cent of the trade and to try to limit these at this stage would seem almost impossible. Even if one can do that under the monopolies legislation, it is not what the consumers want. Nobody wants to see the small retail shops being totally eliminated and we must accept that a number have closed down for different reasons. The consumers have been responsible, with their various changes in attitudes, for closing down many of the shops. Some people may have retired or have gone out of the business voluntarily, but a lot want to continue to provide a good service. Everyone accepts that the small retail shops around the city and in rural Ireland provide an excellent service. Protection must be given to the 10,000 — or 9,000 as somebody said — of these shops. The Minister has said that in the inquiry this will be looked at again.

The Opposition must do their duty and the Government must do theirs. There are points on both sides. It is the Government's job to set up the inquiry and see that it is carried on in a proper manner, as has been done in the last 20 or 25 years. Some Deputies said last week, and again this week, that consumers would be in favour of RGDATA and the other groups. However, the only statement which I have seen was from the Irish Housewives' Association, who did not agree with any legislation which would have a restrictive effect on fair and open competition. They appeared to support the idea of the big supermarkets but there must be controls to ensure that there is not a short-term gain.

The banks were more competitive before they all joined together under the one umbrella and had their own standing committees looking into their dealings with their customers. Legislation could learn from that, that once these big concerns get together and the small people say that this is a great thing, they turn around and close doors and make it almost prohibitive to have a bank account. Supermarkets should not be allowed to act similarly. Other countries have faced this problem. The Fair Trade Commission have been acting for 25 years and must have learned a lot about the grocery trade. There have been numerous inquiries since their foundation and there is a lot of experience within the Department. When the Commission meet again, having gone over the subject thoroughly and knowing what is going on in other countries and, in particular, across the water in the UK, they can bring in or change legislation to keep ahead of the times. There is a great to-do about a situation which is not all that bad.

In support of Deputy O'Toole's view, because I do not totally disagree with him, the terms of inquiry should be set out immediately and the Commission must do whatever they consider necessary. Anyone who wishes can put in a submission and in that way ensure open and public debate and that the best interests of the small retailer and the consumers will be considered in the ensuing legislation.

Mr. B. Desmond

The Parliamentary Labour Party have discussed the general situation on three separate occasions. We had the advance copy of Deputy O'Toole's Private Members' Bill. We carefully considered the situation and decided that, on balance, the Bill was worthy of support. The reason I use the term "on balance" is because many of our Labour Party local authority members questioned whether or not it would have been better to have planning development legislation amended by introducing new commercial criteria, particularly with regard to zoning. On the other hand, there was the contention that it should perhaps be done at ministerial level. That was the main ground of discussion rather than anything inhibiting support of the Bill.

We came down in favour of the Minister exercising his power. I shared that view as a member of a local authority, currently chairman of the largest local authority in the country, an authority catering for a population of roughly 450,000 people, namely, Dublin county. It would be extraordinarily difficult at a county council meeting to decide whether or not the particular criteria in a licence application met all the requisite planning and development criteria. It is true that local authorities have specific zoned areas and planning applications can legitimately be refused on grounds of density, change of use, inadequacy or otherwise of the road network, over-intensification of use and so on. Nevertheless local authorities would have great difficulty in trying to assess matters of a quasi-judicial statutory nature, such as whether or not existing retail grocery outlets adequately serve the community. We concluded that there should be a separate section in the Department of Industry, Commerce and Tourism which would deal with the granting of trading licences. The possibility is that the Department might inevitably have to consult with local authorities but it was our view that responsibility should rest with the Minister under statute because of the scale of development. There would not be in any one year a multiplicity of licence applications coming before the Department. In the case of the grocery trade licensing would arise only where the area exceeds 5,000 square feet. On balance, then, we came down in favour of the Minister having devolved on him that particular responsibility. For that reason we regard the Bill as warranted.

There has been a great deal of argument down the years on the question of development, be it housing development, industrial development, grocery trade development or any other development. There has to be planning and we have to have criteria governing that planning in order to ensure a balance. There is great difficulty sometimes in achieving a proper balance from the point of view of the freedom of the individual, his freedom to trade, freedom to own property, freedom to move from one area to another without injuring his neighbour, his community or the community at large in terms of the State itself. That balance is a very difficult balance to keep but it is a balance we have always favoured. That is why our authority consistently calls for the introduction of planning and development legislation and other socially advantageous legislation in the national interest. We believe in the need for controls and we favour their introduction, be they in relation to wholesaling, retailing, licensed premises, sale of petrol, or any thing else. We see the need for these controls and the community will have to face the fact that controls in the retail grocery trade would be in the common good. They would be warranted. There may be a jaundiced bureaucratic reaction in the Department to the effect that this is a residue of what was known as the special position in the Constitution or in legislation. There is a great element of special pleading in the arguments put forward. This was the pattern in the 1950s, in the 1960s, in the 1970s and now at the commencement of the 1980s but the whole structure of what I might call the retail culture has changed quite dramatically and this type of Bill is warranted now in the common good.

The President of RGDATA, Mr. Foster, gave adequate notice to the Minister on 4 February last when he spoke about the unchecked growth of the multiple chains, and in particular the multinationals, and the extravagant claims of a number of very transient entrepreneurs which had led to a series of detrimental malpractices not in the interests of the common good. That was a reasonable observation, and the pressures will be on this Government and the next — whatever complexion the next Government will have we do not know yet — to take these what Mr. Foster correctly called corrective measures operating in other countries which would shape the control of the growth of the multiple chains in the State. That is a logical and reasonable proposition.

I have read the unrevised verbatim report of the detailed contributions last evening and reading the Minister's contribution, particularly the reference to the prospect of a further inquiry, I must confess that I am totally jaundiced at such a prospect. We have had order after order in the past 25 years without achieving a successful or effective framework for competition in this sector. It is no wonder that the grocery suppliers and most of the distributive trade at this stage have very little confidence, I regret to say, in either the examiner or the RPC or, for that matter, in the Minister. I see no useful purpose whatsoever being served by a decision to hold yet a further inquiry. Yesterday I complained very strongly in the House that it took three years to produce the inquiry on motor spirits, and God forbid that one should have to speculate on how long it would take to complete a new inquiry looking presumably at all aspects of the grocery trade, especially the unequal power relationships that exist within it.

The Minister should not have made that announcement. It was provocative and it has come as no surprise to me at least that RGDATA, the independent retailers' representative body, and IADT who represent grocery wholesalers and their customers, have stated today that both of these organisations have decided not to participate in the forthcoming public inquiry by the Restrictive Practices Commission on the problems in the grocery trade. I think it was reasonable comment on their part although it was stated in extreme terms by the representative organisations. As I know well, having worked in that area for nearly 15 years, representative organisations invariably state their cases in trenchant terms, but the statement issued today by the spokesmen for both organisations said that the proposed inquiry was a sham and an attempt to sidetrack the real issues in the grocery trade.

The Minister should take note of the fact that this statement went on to say that they are not prepared to waste their time and money on yet another public inquiry into the grocery trade, that all the information required by the Minister to make an informed decision on the problems of the trade are well known to him and yet he is insisting on going ahead with another costly and time-wasting public inquiry. Therefore, this is a serious statement on the part of these organisations and in it they have indicated also that they do not intend to make submissions. Naturally, we all appreciate that any organisation called before a public inquiry can be subpoenaed to attend and have no option but to attend, but they are not necessarily obliged to present witnesses formally, to have counsel representing them at that stage or to make written submissions unless formally subpoenaed to present such evidence, as I remember from some inquiries. I gather this is the general intention of the organisations concerned.

Therefore, we have to say to the Minister that this is an understandable and extreme reaction because there is always the argument that, no matter what a Government do, one should keep plugging away. However, undoubtedly there can come a time when, to use the classic phrase, no further useful purpose can be served by indulging in that form of inquiry. Therefore, the Minister should take very careful note of the decision of these organisations not to so participate.

I found it rather ironic that yesterday afternoon we spent several hours here with the Minister of State, Deputy Gallagher, debating the role of the retail petrol outlets and proposing the order in the Bill which was debated here at considerable length in detail. It is ironic that this Bill endorsed very closely the recommendations in the report of the Restrictive Practices Commission about which I complained so bitterly. I wonder what the hell the Restrictive Practices Commission were up to for the three years that they did not require to come up with the earth-shattering conclusion that there should be a restriction in the public interest in relation to outlets for retail petrol. Anyway, at long last they did come up with that and, as Deputy O'Toole said rightly last evening, the report did indicate that the restriction was in the public interest because "the overall share of the retail market held by the petrol companies would be much greater with the undesirable result of increased rigidity in the market and the danger of restrictive or discriminatory practices".

The general principles are there and there is nothing ideologically difficult for the Minister to so debate and introduce amended legislation. Such legislation would need to be drafted very carefully. The longer I am in this House the more I see that legislation being present can be riddled with constitutional difficulties, particularly since we have a Constitution which enshrines in such great strength the freedom of the individual. While I share the view that the individual's freedom should have absolute constitutional protection, the sections of our Constitution which allude to trading relationships and the right to trade in commodities on a free and independent basis, there would need to be great care in the drafting of such legislation so that half a dozen constitutional actions would not be launched against it and the legislation brought into disrepute. It is well within the competence of the parliamentary draftsman and the Restrictive Practices Commission — not that I would give them the responsibility for drafting the legislation — to devise an effective Bill.

I have been in Holland, Italy, France and Britain. Only last week I was in the Hague. I spent two or three days there. I chatted with various parliamentary colleagues in the Dutch Parliament. I saw several retailing controls in operation. I have seen them in operation in France, particularly in the Alsace region. I have not got much knowledge about other areas in France. In the past seven years I went to that region five or six times as an Irish delegate to the Council of Europe and I had the opportunity to see what happens there. Lest my fellow Deputies should think that I indulge in undue travelling, I can assure them that I do not. I was in Britain quite recently. My trip had nothing to do with retailing controls. It had to do with methods of refuse disposal. My county council colleagues and I went to Newcastle, Glasgow and Edinburgh. We saw the policy guidelines from the Department in operation in those areas.

There are 100 members of the South Yorkshire County Council which covers a catchment area of over one million people. I felt a particular affinity with them because there are something like 82 Labour members out of the 100 councillors. The chairman of the environment committee and other committees were able to tell me that these controls and criteria are in operation and, by and large, they work for the common good. There is no proliferation of multinational stores in those areas. There is adequate legislation available to the Minister on which he could draft a Bill, provided that he wants to introduce his own Bill.

Section 7 contains the prohibition on selling below net invoice price. I am glad to see that. I am also glad to see the RPC report. The Minister's decision on below cost selling was made on 3 March 1981. I do not know what the Minister, Deputy O'Malley, was doing during the Christmas holidays. He has had this report since last November. I am sure it did not comprise the best part of his Christmas reading. However, he should have dealt with the report earlier on.

I am a member of the Joint Committee on the State-Sponsored Bodies and in the past couple of years we have produced 17 reports. We work on a part-time basis. We have a staff of four. We have not got Departments at our disposal. We sit in Leinster House and we are able to get through that kind of work. The RPC and the Minister decided to do nothing to change the regulations governing competition in the grocery trade and they decided not to ban below cost selling. A decision to hold an inquiry was taken in July 1979.

Chapter 1 of the report makes it clear that the problem of unequal power relationship, that is, the very high concentration in the retailing sector with just a few multiples in operation, was well known. It is difficult to understand why the RPC should take 18 months to decide to do nothing. It is harder to fathom why the Minister should now decide to have a new inquiry into features of the trade which were common knowledge when the previous inquiry was set up.

It took three years for the motor spirits inquiry to be completed and, judging by that fact, it is unlikely that this completely unnecessary new inquiry will be completed before the late eighties. The RPC said they have been studying the grocery trade and producing order after order for the past 25 years without achieving a successful or effective framework for competition. It is no wonder that everyone is jaundiced.

The question in relation to below cost selling is the significance of its impact. I regret to say that the RPC report is very uneven. Much time was devoted to consideration of the impact of cut-throat pricing on the reduction in the total number of independent grocery outlets. The opinions of those knowledgeable in the trade by and large were rejected in the report. On the other hand, below cost selling and its effects on the consumer are handled very briefly in the report. It is a very unbalanced report.

There was an acceptance of the view of the Irish Housewives Association, although that view is the exact opposite to the view the IHA put before the previous grocery inquiry. I say that with great deference to my colleagues in the IHA whom I have known over the years. More striking is the fact that the effect of below cost selling on the multiples was handled in just one brief paragraph in the report. The inquiry revealed that a minority only of the multiples favoured below-cost selling. Apparently the majority did not like the practice but were forced into using it in order to keep pace with the few who chose to indulge in it. That highly significant fact is not discussed at all in the report.

I do not know how it could take from July 1979 to date to do that. I suppose it is related in some way to the fact that there are now only five or six major multiples in the country and that the levels of profitability in the grocery trade have diminished alarmingly, especially in the food sector where they are extremely low. Below cost selling has ensured that a number of companies will lose. I said this before and I was hit over the head by one multiple. If this type of nonsense goes on the multiples will lose; the consumer will lose; the retail independent grocers will not just go out of business; they will be hanged, drawn and quartered and put out of business and the consumer will lose quite considerably.

I appreciate that my comments might not be very acceptable to some people but nevertheless I support this aspect of the Bill. I do not know who the editor is of the paper I have here, but it is suggested in one of those publications that I have jumped on this particular bandwagon. There were some derogatory comments about the Minister for Industry, Commerce and Energy. This is a reprint of a Fine Gael newspaper. I received the late Mr. MacGowan from Blackrock in this House in 1970. I had many a garrulous, fruitful, interesting and very long discussion over the years with him. This is not a bandwagon I am interested in jumping on but one which at the moment is rolling in the direction of a cliff.

The Government should give this Bill very careful consideration. Between now and next Tuesday the Government should consider putting down some amendments. I would even go so far as to say that I would be prepared to sit down, despite the pressure, on an all-party committee to discuss this subject. I would even concede that the Minister of State, Deputy Gallagher, should take the chair. We could receive evidence from different people as a Select Committee of the House.

Minister of State at the Department of Industry, Commerce and Tourism (Mr. Meaney)

The Minister of State, Deputy Gallagher, covered a lot of ground last night and no doubt most of it was controversial. The Minister's authority seems to run right across Deputy O'Tooles Bill. It runs right across many of the things contained in the Planning Acts. It puts an added burden on many people who want to set up in business. It was agreed by all parties that An Bord Pleanála would be the authority in relation to all planning applications, but in this Bill introduced by Deputy O'Toole the word "Minister" seems to be the determining factor in everything. Whether one wants to set up an outlet in a rural area or in an urban area, it is the Minister who at all times would have a say in it. That is a great weakness in the Bill.

We have been discussing this matter on and off for many years. Many people have tried to get a complete all-round solution but they have not been able to do so. Governments have come and governments have gone and this has been with us for the last 20 years. It flares up, it dies down and it flares up again. The Minister of State last night covered a matter which is often referred to, that it would be against the "Buy Irish" campaign to accept this Bill.

Many people have been worried that the so-called price war would lead to an increased volume of imported food products, but investigations have shown that has not really occurred. It has been noticed of late that the relationship between the manufacturers and the importers has greatly improved. That will please everybody because we all know that once the chips are down——

Mr. O'Toole

Chips are being imported to the tune of 10,000 tonnes a year.

Mr. Meaney

Fine Gael did not do anything about that. It was a Fianna Fáil man who took up the cudgels.

(Interruptions.)

An Leas-Cheann Comhairle

Deputy O'Toole spoke last night and he will be able to speak again. The Minister, without interruption. We will go ahead without any chips or interruptions.

(Interruptions.)

An Leas-Cheann Comhairle

The two Deputies need not chip in at this stage.

(Interruptions.)

Mr. Meaney

It will be seen that there is ample scope for action to deal with the problem of imports without resorting to the introduction of controls over the operation of types of retail outlets who are accused of being largely responsible for the high level of imports. As regards the implications which often have been mentioned of foreign ownership of some multiples, there has been a suggestion that the controls proposed in the Bill are necessary to curtail development by those companies. It is suggested that this is possible only because of the availability of external finance which allows either subsidisation of price cutting campaigns to enhance the success of developments, or direct subsidisation of expansion.

In this connection it is interesting to recall the comments of the Restrictive Practices Commission in the recently published report on below cost selling. The people on that commission are of standing and experience. They stated in relation to one of those multiples that they found nothing in that company's accounts to suggest any element of subsidisation from outside the Irish operation. That was a very strong statement to make and it refutes any suggestions made otherwise. In the case of the second company, they rejected a suggestion that their pricing policy was subsidised from funds from abroad and stated that their stores had throughout attained a trading profit. If any Deputy on the other side has anything to say to the contrary he knows where to telephone his information and where to make his submission.

In general, it is not considered that the present circumstances of the manufacturing and distributive sectors are such as to warrant, without the most exhaustive investigations to determine the interests of the common good, the types of controls envisaged in the Bill. The main objectives of the Bill appear to be that no group of enterprises between three and five in number should have an aggregate market share in excess of 45 per cent and no enterprise should have more than a 20 per cent share of the grocery market in any one year. The Bill states that the Minister should use his powers under section 2 of the Mergers, Takeovers and Monopolies Control Act, 1978, to break up an enterprise whose market share exceeds 20 per cent in any year. The Bill also provides that all retail grocery outlets whose area exceeds 5,000 square feet should be licensed and that all outlets owned by an enterprise which has a market share of 5 per cent, irrespective of size, should be licensed, and below cost selling should be prohibited.

Mr. R. Ryan

On a point of order, having regard to the fact that the Minister of State is reading a prepared script to the House, we should be offered a copy of that speech or else he should be subject to the same rules that apply to all Members of the House, that is, that their speeches are delivered extempore and not read from a script.

An Leas-Cheann Comhairle

Down the years when important statements were being made, Ministers, Ministers of State and leaders of Opposition parties have been allowed by the Chair to read their statements.

Mr. R. Ryan

May we have a copy of the script?

An Leas-Cheann Comhairle

It is a matter for the Minister not for the Chair as to whether copies are distributed or not.

Mr. R. Ryan

The rules of this House specify that speeches be delivered from the heart and the mind not from the prepared scripts of civil servants. If this is to become nothing except the prepared script of a tired civil servant we end democracy in the House. Could we have a copy of the script?

(Interruptions.)

Mr. R. Ryan

The Minister of State who is reading the script does not have any understanding. Can we have a copy of it?

Mr. Meaney

I understand more than the Deputy.

An Leas-Cheann Comhairle

The Chair has no control over whether the Minister gives copies of the script. The Chair wants to say one thing at this stage. From his own observations over the past few months quite a number of Members on all sides of the House have been coming in and reading speeches. It is very difficult for the Chair to know if a Member is reading his speech or reading from voluminous notes. But it has been granted always by the Chair that Ministers, Ministers of State and leaders of the Opposition parties have been allowed to read statements to the House.

Mr. R. Ryan

I respectfully submit that the practices of this Parliament, which is now about to celebrate its sixtieth year, is that Members speak without a script except for Ministers and, as you say, leaders of the Opposition. We now have a performance in which, for the second Government contribution, we are having a statement which was written by civil servants but which is being delivered by a Minister of State.

An Leas-Cheann Comhairle

The Deputy is not on a point of order now.

Mr. R. Ryan

I am, Sir.

An Leas-Cheann Comhairle

The Chair has pointed out already that down through the years Ministers and Parliamentary Secretaries and, of late, Ministers of State have been allowed to read statements in the House. That applies also to Leaders of the Opposition parties. Quite a few more are reading from scripts also and I accept that that is not right.

Mr. R. Ryan

I am glad to have the Chair's statement that the practice is not right. If it is allowed at all there is a courtesy whereby a copy of the speech is made available to people on the opposite side of the House. We now have a document that has been written by civil servants——

An Leas-Cheann Comhairle

The Deputy has made his point and should resume his seat.

Mr. R. Ryan

We are now having a document read at us and even as I make my protest I am sure that it delights the person who is reading that document that has been prepared by civil servants to do so. We represent the people. The civil servants do not represent them.

An Leas-Cheann Comhairle

There should be no attack on civil servants.

Mr. R. Ryan

We are being insulted again and again by a load of clap-trap which is coming to us from civil servants who are delighted that although we as democrats protest against it, the Minister will continue to read this jargon at us.

Mr. Meaney

The Deputy thinks he is someone special. He will not even open the boot of his car for the man at the gate.

An Leas-Cheann Comhairle

Deputy Ryan must resume his seat and allow the business of the House to continue. The Chair has no responsibility as to whether a Minister or Minister of State provides copies of a speech.

Mr. R. Ryan

The Chair has such responsibility.

An Leas-Cheann Comhairle

The matter is one for the Minister and for the Department concerned. I am now asking the Minister of State to continue his speech.

Mr. R. Ryan

He is reading a script that has been prepared by civil servants. This is an insult to everybody in Ireland, to everybody who believes in democracy and in free enterprise. We are being got at by the officials who have no respect for democracy and by Ministers who are insulting democracy and who want to wipe out private enterprise.

An Leas-Cheann Comhairle

An attack in this House on officials is totally disorderly and should not happen.

Mr. R. Ryan

I agree that it should not happen but what we are being subjected to could not have been written by any human beings other than civil servants. Civil servants do not have their heart in what they are writing. We are being subjected to a load of rubbish that has been prepared by official economists who have pushed out more than 20,000 grocers.

An Leas-Cheann Comhairle

What has got into Deputy Ryan at this hour of the evening? If he does not resume his seat, I shall have to adjourn the House.

Mr. R. Ryan

When I entered this House it was a Parliament of Members on both sides who gave heart and feeling to it but now one side is a bureaucracy against the rest of the Irish people.

An Leas-Cheann Comhairle

The Deputy should at least respect the Chair. He must resume his seat and allow the House to continue its business.

Mr. R. Ryan

And allow the Minister to continue reading the script that has been prepared for him by civil servants.

Mr. Meaney

In referring to the 5,000 square feet area, I was quoting from the Bill—subsection (1) of section 4.

Mr. R. Ryan

The Minister has been quoting civil service jargon.

Mr. Meaney

Deputy O'Toole's jargon is what I am quoting.

(Interruptions.)

An Leas-Cheann Comhairle

Will Deputy Ryan please desist? We will go home early if he so wishes.

Mr. Meaney

We are not told whether this area of 5,000 square feet relates to an entire shopping area, including storage and car parking areas.

Mr. O'Toole

Come off it, Minister.

Mr. Meaney

This just shows how random this Bill is. Deputy Ryan has a lot to say about civil servants. It is very unfair of him to refer to people who are not here to defend themselves and who may not be involved at all in the speech. They may be partly involved or they may not be involved in any way.

Mr. R. Ryan

The Minister is reading their speech.

Mr. Meaney

I object to the Deputy's remarks about civil servants. I would have expected him to have had more respect for them.

Mr. R. Ryan

What the Minister is reading could only have come from civil servants.

An Leas-Cheann Comhairle

Deputy Ryan, please.

Mr. Meaney

According to this Bill the Minister would have the last say as to who should be granted a licence. That would be a very bad provision. Many times in the past in respect of commissions, for instance, the Opposition have argued against the Minister having full say. The Planning Act is an example of the Minister not having the final say. Appeals under that legislation are to an independent board.

Mr. R. Ryan

The criteria are laid down in the Bill.

An Leas-Cheann Comhairle

The Deputy would probably have been called five minutes ago if it had not been for his interruptions.

Mr. Meaney

It has been said that this Bill must be regarded as being very radical. We see its implications for everybody, for retailers and consumers alike. So far as retailers are concerned their ability to develop and expand to meet a consumer demand would be seriously impaired by the proposed legislation. There is nothing in the Bill to indicate how the Minister would deal with the matter. Is it envisaged that he would set up a commission or a group of inspectors for the purpose of the legislation? Legislation of the type proposed could affect adversely the competitiveness of the retailer by interfering with his ability to increase through-put and, consequently, to effect cost savings. While the controls would affect adversely the multinationals in the main, they would apply also to the independent sector. Given the market share in sections 2 and 5, the greatest impact would be on the multiple chains.

Regarding the consumer interest, particularly in the provinces, it would appear that the proposal would have a significant impact. By and large, these consumers do not seem to have benefited to the same extent as the consumer in our main cities who have had the advantage of benefiting from the larger units. Such advantages would include access to parking facilities convenient to one-stop parking, access to a larger range of goods and benefits derived from economies achieved by the larger units and resulting in lower prices. It would seem that the rural consumer would have grounds for claiming that he was unfairly discriminated against as compared with his fellow consumer who would continue to enjoy the advantages he has at present in this regard. We have recently seen firm evidence to this effect in Galway — surely Deputies know what I am talking about — where a strong consumer lobby objected quite strenuously to efforts by other interested parties to have a proposed shopping complex prohibited. This was highlighted in the papers and the margins for and against were reported and showed the trend in people's thinking.

Mr. O'Toole

The Minister should mention the name, Tesco.

Mr. Meaney

I do not mention in the House names of people who are not in a position to defend themselves. This would be a very bad place to mention such things.

An Leas-Cheann Comhairle

The names of firms and people outside the House should not be mentioned.

Mr. Meaney

It is quite obvious that all interests affected would not support this Bill. Even if the Bill were implemented there would still be problems because all sections would not accept the Bill as something definite that would cure their ills. This action could only be justified if there was evidence that the common good was gravely at risk. Such evidence does not appear to exist and in its absence I would not agree with the imposition of the control proposed. Naturally, Fine Gael are doing their best to gain whatever advantage they can at this time but the Bill they have brought in has many loopholes in it. We have been pointing them out one by one. I note that section 2 (1) provides that no three or more enterprises not exceeding five shall have more than a 45 per cent control ... in the retail grocery market in any year. The Bill does not provide what would happen if this figure is exceeded.

Mr. O'Toole

You apply the Mergers, Take-Overs and Monopolies Act which is already on the Statute Book.

Mr. Meaney

But that is not legally contained in this Bill.

Mr. O'Toole

Would the Minister look at section 6?

An Leas-Cheann Comhairle

Deputy O'Toole has already spoken and he will be called again, I presume, next week.

Mr. O'Toole

The Minister has not read the Bill.

An Leas-Cheann Comhairle

The Chair is not responsible for that.

Mr. O'Toole

I appreciate that.

An Leas-Cheann Comhairle

But I am responsible for trying to keep order in the House.

Mr. Meaney

Section 3 (1) which enables the Minister to break up an enterprise applies only where an enterprise has more than 20 per cent of the market. It may be that it is envisaged that some formula would be included as a condition in the licence to be issued by the Minister under section 4(2), that it is a condition of the licence that it would be revoked if sales from the outlet in question contribute towards an aggregate figure including returns from other enterprises which would constitute a breach of another section, section 2(1). There is no point in going over all of these and making points on them. If such were the case it would be difficult to decide which licence of which enterprise should be revoked. Such circumstances must surely be regarded as constituting intolerable conditions under which enterprises might be expected to operate.

Likewise it is difficult to see how the Minister might exercise his powers under section 3(1)(b) if an enterprise had a market share just short of the 20 per cent allowed by section 2(2) and it is proposed to open a new outlet and a licence is sought. The Minister does not appear to be enabled to refuse to grant such a licence. In fact he would be required to grant a licence and yet the licence, it would appear, must contain such conditions as would render the enterprise unable to operate the new outlet.

Mr. O'Toole

Has the Minister ever read the Mergers, Take-overs and Monopolies Act?

Mr. Meaney

As regards the licensing provision in section 4, it is not clear what precisely can be achieved. I do not know if future Minister, Deputy O'Keeffe read all of this Bill. I doubt if he has.

(Interruptions.)

Mr. O'Keeffe

The Minister might be surprised what——

Mr. O'Toole

Do not go too far.

Mr. Meaney

The Minister must grant a licence on receipt of application as long as the applicant has not been convicted of an offence. The main control would appear therefore to be contained in the conditions attached to a licence, but there is no indication of the type of conditions envisaged. Could it be that an enterprise that has been operating retail grocery outlets for many years could be closed down by the Minister because of failure to comply with some frivilous condition?

Mr. O'Toole

Read the Bill.

Mr. Meaney

You can read and read it and come up against ——

Mr. O'Toole

The Minister has not read the Casual Trading Act. I shall give him suggestions for bedtime reading.

Mr. Meaney

The Bill proposes to amend the Restrictive Practices Act, 1972, to provide in effect that an order under section 8 of that Act should be made within three months of the relevant report by the commission. That is something I could not accept. This presumably is an implied criticism of the delay in making the recent Restrictive Practices Grocery Order, 1981.

Mr. O'Toole

The Minister is absolutely correct.

Mr. Meaney

It will be noted in this connection that the delay involved in that case was not very much more than the three-month period now proposed. Notwithstanding this it must be recognised that most, if not all reports of inquiries furnished by the commission to the Minister are not of a type which allow of immediate action and decision by the Minister. As the House is aware, the Minister is required by the Act not alone to consider the report but also to satisfy himself that if it is proposed to make an order it is warranted by the exigencies of the common good. Such requirement necessitates that the most exhaustive examination of the report is effected to ensure that as far as possible the proper decision is taken. That is for the common good; I think everybody is worried about that. If a Minister found that the three-month period were shortly to expire, he might find himself forced into making a decision because of this constraint which in more favourable circumstances might not have been taken.

Additionally, the drafting of orders can be a difficult matter — nobody knows more about that than parliamentarians — and may, on occasion, give rise to considerations of constitutionality. An order could be ruled by the courts to be unconstitutional and declared invalid because of some defect which arose from the time constraint. Not alone would such a situation be undesirable but it would seem that because a valid order was not made within the three-month period specified, the Minister would be unable to make a proper order without requiring the commission to hold a further inquiry and submit a further report on the matter.

Regarding the proposal in section 7 of the Bill that the selling of grocery goods below cost should be prohibited immediately, the Minister has already indicated and I indicated in a statement in the past week, the reasons why it should not be prohibited. There seems to be no reason why that view should be altered at present and accordingly the Bill is being opposed.

In conclusion, we are opposed to the proposals in the Bill and regard it as constituting such an interference with long-held belief in freedom to trade as being justifiable only if it is clearly demonstrated that there is at present grave danger to the common good which could only at best be remedied by action of the type proposed. This has not been so demonstrated.

Mr. O'Toole

There is more danger from the far side of the House to the common good.

Mr. Meaney

We have, I think, outlined the dangers——

Mr. O'Toole

And you do nothing about it, absolutely nothing.

An Leas-Cheann Comhairle

Please, Deputy O'Toole. Is the Minister concluding, because if not we will have to adjourn the debate and he will have two minutes the next night?

Mr. Meaney

I do accept that there are problems in the grocery sector. We all know this.

Mr. R. Ryan

Now, A Leas-Cheann Comhairle, with respect, you gave a hint——

An Leas-Cheann Comhairle

I am trying to get the Minister to conclude if I can and let Deputy Ryan in. If the Deputy keeps on interrupting, we cannot do that.

Mr. R. Ryan

I am not that naive.

An Leas-Cheann Comhairle

Please do not attack the Chair as well as everything else. Will the Deputy please move the adjournment?

Mr. R. Ryan

No, Sir, there is still a minute-and-a-half left, and during that I want to say——

An Leas-Cheann Comhairle

Will Deputy Ryan move the adjournment of the debate?

Mr. R. Ryan

There is still a minute-and-a-half left on that clock in front of the Chair.

An Leas-Cheann Comhairle

The Chair has other business to do at this stage——

Mr. R. Ryan

I want to say during that time that it is high time that this national Parliament should cease to be insulted by Ministers coming in here and reading——

An Leas-Cheann Comhairle

Would the Deputy move the adjournment of the debate?

Mr. R. Ryan

No, I will not move the adjournment. We still have one-and-a-half minutes to go in public debate during which I am entitled to say that we are out to preserve the rights of Irish grocers to live and maintain their own families——

An Leas-Cheann Comhairle

Will the Deputy please have some respect for the Chair?

Mr. R. Ryan

They are entitled to get more support and respect than they are getting from a Government that is sniggering and laughing at them as they read from pages written by civil servants——

An Leas-Cheann Comhairle

Would Deputy Ryan let the Chair do its business, please?

Mr. R. Ryan

The time is not up yet, Sir.

An Leas-Cheann Comhairle

It is and the Chair has other business to do.

Mr. R. Ryan

I am entitled as a public representative to see that the rights of Irish grocers are protected and I will not be——

An Leas-Cheann Comhairle

The Deputy will have his time on the next night.

Mr. R. Ryan

I am not going to be put off. It is now half past eight and the Chair is entitled to proceed.

An Leas-Cheann Comhairle

Seanad Éireann has passed the Restrictive Practices (Confirmation of Order) Bill, 1981——

The disrespect for the Chair by Deputy Ryan tonight has been disgraceful. I would expect something better from a Member of this House of the standing of Deputy Ryan.

Mr. R. Ryan

I will not be shouted down while we still have a minute-and-a-half to go. I am not prepared to accept that from you or anybody else. We are entitled to Private Members' Time of 90 minutes and, with respect, the Chair has no right to occupy that. We have 90 minutes for Private Members' time during which we are entitled——

An Leas-Cheann Comhairle

The Chair told the Deputy that the time was up and asked him to move the adjournment.

Mr. R. Ryan

It was not up. I cannot accept that. The clock showed clearly a minute-and-a-half to go.

An Leas-Cheann Comhairle

The Deputy is just acting in a disgraceful fashion.

Mr. R. Ryan

And the Chair is acting equally disgracefully. The standards of this House are falling——

An Leas-Cheann Comhairle

I would not expect that from Deputy Ryan. We do not see him too often in the House.

Mr. R. Ryan

——and you are contributing to it.

Debate adjourned.