I call on Deputy Hogan to move amendment No. 5.
Competition (Amendment) Bill 2005 [Seanad]: Report Stage (Resumed) and Final Stage.
What about amendment No. 3?
It cannot be moved in view of the decision on amendment No. 2.
We debated it, but I understood that the amendment in Deputy Hogan's name was simply that the words proposed to be deleted stand. This is to insert a new section and does not alter the words that are to stand.
Amendments Nos. 3 and 4 cannot be moved in view of the decision on amendment No. 2.
I believe the Leas-Cheann Comhairle is incorrect. The division on the previous amendment in Deputy Hogan's name decided that the words proposed to be deleted should stand. I am not altering that, but I seek in amendment No. 3 to insert a new subsection in addition to the words that should stand. I know there may not be a debate on it, since we have had that, but I wish to put the amendment formally.
It has been decided that the words will stand.
No, the House decided that the words in the Bill should stand. I am not altering them.
Once the House has decided that the words should stand, one cannot move such a motion.
That makes no sense in common English. The section stands, but I wish to insert a new subsection. I simply wish the matter to be put.
The House has decided that the words stand, so the Deputy may not do that.
I agree that the words will stand, but I wish to add a new subsection in addition. May amendment No. 3 simply be put?
The amendment may not be put, since the Chair has already ruled on it. The House decided the words should stand, and they may not be changed thereafter.
I do not propose that any word be changed. I propose that an additional——
We cannot have an addendum.
What we debated and what the House divided on was the amendment in Deputy Hogan's name, which was to alter the wording of subsection 15B. I now propose simply to add a new subsection.
We will not debate that here, since the Chair had already ruled before I came in. I rule a second time — which I should not — the same way as the previous Chair. However, I will be glad to discuss the matter with the Deputy in my office if he so wishes. We have moved on from that point.
I would not have agreed to the grouping of amendments had I known that. Predatory pricing is the meat of the issue, and I simply wanted——
We have moved on, and the next amendment is No. 4 in Deputy Hogan's name, which cannot be moved. Amendment No. 5 in Deputy Hogan's name arises from committee proceedings.
Amendments Nos. 3 and 4 not moved.
I move amendment No. 5:
In page 5, line 33, after "person" to insert the following:
", including the National Consumer Agency and consumer groups,".
This amendment is to allow the National Consumer Agency and other representative groups to have matters regarding the legislation investigated.
There are several reasons that this amendment is inappropriate. First, any person who feels aggrieved will have the right to appeal under this section. Second, if this agency were mentioned, there might well be good reason to mention several others in the consumer or commercial area. In those circumstances, the amendment is inappropriate.
Amendment, by leave, withdrawn.
Amendment No. 6 in Deputy Hogan's name arises from committee proceedings.
I move amendment No. 6:
In page 5, line 49, after "the" to insert "District Court or in the".
This amendment is to allow a cheaper opportunity to adjudicate on matters under the legislation rather than have all matters adjudicated by the Circuit Court and High Court, which, as the Minister of State knows, are much more expensive. I believe that the District Court would be appropriate to a large number of cases and allow people to take cases in a less expensive manner and with a lighter evidential burden, especially regarding predatory pricing and other such very serious matters. Ultimately, they may end up in a higher court through the appeal mechanism, but they should at least start in the District Court.
If accepted, this amendment's impact would be that cases under sections 15C(1), 15C(2) and 15C(3) could be brought to the District Court. However, the District Court cannot grant reliefs such as injunctions and declarations. That is one reason that it would be inappropriate to have this provision. While the authority cannot seek damages, a private party can do so, and the limit on the District Court, as Members are aware, is €6,350, which is very low. In the circumstances, it would seem unhelpful to people who might wish to use this section that their actions be taken through the District Court. The Circuit Court would be far stronger.
Amendment, by leave, withdrawn.
Amendment No. 7 in Deputy Hogan's name arises from committee proceedings. Amendment No. 8 is related and may be taken with it.
I move amendment No. 7:
In page 6, between lines 9 and 10, to insert the following:
"(5) For the purposes of this section, the cost to the retailer of the grocery goods shall be calculated inclusive of all discounts, rebates or other allowances received by the retailer on the supply of the goods.".
We had a good discussion on this on Committee Stage. Retailers, particularly multiples, could have a restriction of offer to eliminate the competition. They would have a supply of goods by quota in a community or locality to stymie the chance of their being available nationally. It should be available nationally and not simply in a small geographical area or community with the intention of engaging in predatory pricing and putting the competition out of business, particularly when safeguards are now being removed, allowing multiples to do as they wish without restriction or quota. Perhaps the Minister of State might comment on that and state how he can prevent the situation from arising where a multiple puts the competition out of business in a given locality without having the same offer available to all consumers nationally.
It is important to state that restrictions on predatory pricing are not being removed by this legislation but strengthened. The first effect of the amendment would be that the same price would be charged in all shops operated by a retailer nationwide. It would impose a national pricing policy, clearly creating some difficulties in local markets. It would distort and prevent competition there, something entirely undesirable in the context of what we are trying to achieve. We are not in the business of creating a national market in groceries. It would be both anti-consumer and anti-competitive.
As Deputy Hogan said, we had a long debate on this yesterday, and the same issues arise regarding this amendment's impact as would arise in the case of the others. I do not want to go over all that again, but enforcement would be very difficult too, creating a large number of issues not provided for. It would certainly not have the effect of improving the situation from the consumer's perspective.
Amendment, by leave, withdrawn.
Amendments Nos. 8 and 9 not moved.
Amendment No. 10 in the name of Deputy Howlin has been ruled out of order.
I have the Ceann Comhairle's letter to the effect that this amendment is out of order. This matter was discussed on Committee Stage by leave of the Chair and the Minister responded to it. Amendment No. 10 is an amendment to the parent Act, namely, the Competition Act 2002. I presume that it runs foul of the Long Title ruling. Is that where the difficulty arises?
It was ruled out of order because it is outside the scope of the Bill. The Bill deals exclusively with the revocation of the groceries order.
As the Ceann Comhairle is aware, this Bill is the Competition (Amendment) Bill and its purpose is to amend the primary Act, namely, the Competition Act 2002. The amendment's purpose is also to amend the primary Act. This is an important issue on which the Minister commented on Committee Stage. While I do not know whether he would allow an adjustment to the Long Title to encompass this amendment, it is important at least to have a debate on the matter.
The amendment must be ruled out of order because it is not the Long Title of a Bill, but its contents, that decides whether it is in order.
This issue was discussed on Committee Stage when the Minister referred to, among other things, my raising the fundamental matter of this amendment on the Adjournment. He referred to my speech as being pained, empathetic, outraged and so on. However, I wish to focus strictly on the ruling under discussion, namely, Standing Order 125. Adequate notice was given of this matter on Second Stage and it was discussed substantially on that Stage. When in Government, my understanding was that while a member of the Government takes responsibility for introducing legislation, from the moment it comes before the House, it becomes the property of the House. Standing Order 125 is explicit that matters which are discussed substantially on Second Stage — this was done on Second Stage in this case — and which are again referred to on Committee Stage are relevant to the Bill in question. The suggestion that one can, as it were, resile to the Title by way of exclusion of the amendment is unacceptable. While I have no difficulty in living with Standing Orders, my understanding is that Standing Order 125 covers this situation.
While I am anxious to be as co-operative as possible in this respect, I will make a point. This amendment would insert a new section, section 4A, into the Competition Act 2002. While it was open to the sponsors of the legislation, that is, the Government, to call it the groceries order amendment Bill if it wished, it did not do so. It called it the Competition (Amendment) Bill.
As for the manner in which this is discussed, a further problem arises. During the debate on the Employees (Provision of Information and Consultation) Act, it was explicitly stated that when a similar amendment was inserted, such an amendment belonged by way of revision to the competition legislation.
By the way, very unhelpful remarks were made concerning this legislation on Committee Stage, including, for example, one which suggested that people with views similar to mine assume that all actors are poor, all barristers are rich and so on. That was a shameful remark. My remarks on the Adjournment and on Committee Stage were made on the basis of——
Deputy, we cannot go back over Committee Stage. The position on Amendment No. 10 is that the Chair has ruled it out of order.
I suggest that——
I see that Standing Order 125 states that amendments may be taken provided such amendments are relevant to the provisions of the Bill.
Absolutely. This is the Competition (Amendment) Bill and the amendment inserts a section in it.
The amendment was ruled out of order on the basis that it was not relevant. We will move on to the next amendment. The Deputy has been afforded a good opportunity to make a point. Normally, we should simply move on.
I know we should. However, normally the Government should introduce legislation under the proper title and the limitation should be expressed substantially. It was not.
We are moving on to amendment No. 11 in the name of Deputy Howlin. As amendment No. 12 is related, amendments Nos. 11 and 12 will be taken together.
I hope there will be a legal challenge on this issue which the legislation could have avoided. This will be my last remark. I hope that the intemperate remarks written for the Minister on Committee Stage will not be repeated. Otherwise I will be obliged to reply to them. I know more about artists' income than any bloody person writing speeches for the Minister.
We are moving on from that amendment anyway.
Amendment No. 10 not moved.
I move amendment No. 11:
In page 7, to delete lines 3 and 4.
As the Ceann Comhairle noted, amendment No. 12 is related. This is simply a technical amendment. It seems to me on simple reading that subsection 5(2) states that insofar as it is unrepealed, the Restrictive Practices Act 1972 is repealed. The Bill's Schedule includes all the enactments which are to be repealed and it seems to me that the Restrictive Practices Act 1972 belongs in that list. I am uncertain that the reason given to me on Committee Stage by the Minister is in any way valid because section 6 of the Bill provides him with the ability to bring in any section of the Bill, or any part of the Bill, at his pleasure after its enactment. It seems to me that it would be more properly and logically located in the manner I suggest rather than in the way presented by the Minister.
I understand Deputy Howlin's point and what his amendment tries to achieve. Under normal circumstances, his point would undoubtedly be correct.
These must be abnormal circumstances.
It is somewhat unusual, in the sense that the Bill will only come into force as a result of a commencement order under section 6(3). The intention is that section 5(2) will not be commenced until all proceedings in train pursuant to the 1972 Act have been disposed of. Once that happens, a second commencement order will be introduced to give effect to section 5(2). The Bill has been drafted in this form to facilitate the making of the necessary confirmation orders in due course.
I still do not understand the logic, inasmuch as the Minister may bring in any section of the Bill at his pleasure. Someone wishing to establish what provisions have been repealed by it will examine the Schedule. However, the repeal of the Restrictive Practices Act will not be noted in the Schedule. This seems to be both inelegant and confusing for potential readers of the Bill and contrary to the normal Standing Orders to the effect that all Bills should be clearly read. While I do not see why the Minister's purpose could not be achieved by the amendment, I will not exercise myself overmuch in this respect. Does the Minister of State not grasp my point?
I support amendments Nos. 11 and 12. I am afraid the Minister of State's response to Deputy Howlin's amendments is in keeping with the Department's attitude to this legislation. It seems to me that it wishes to create à la carte legislation from which it can pick and choose at will. Members were informed on Committee Stage that the previous amendment, namely, amendment No. 10, could only be dealt with in the context of the Industrial Relations Acts. However, this is not the case because, clearly, the Competition Authority was established under the Competition Act and this Bill pertains to that Act. Hence, the Government’s attitude has been very unhelpful in this regard and does not lead to proper legislation.
At present, many freelance workers do not have the right to be collectively represented and effectively are being treated as though they were companies. This position is unacceptable and the amendment would have helped to resolve it. Within the context of this Bill, there was clear provision to deal with this issue and it is most unfortunate that Members have been misled on some occasions and misrepresented on others, as have the workers. As Deputy Michael D. Higgins has noted, workers have been accused of being well off in certain circumstances. I support these two amendments and hope the Minister of State will be somewhat more forthright in his response.
The position I outlined does not arise from any particular preference in the Department or, indeed, on the part of the Minister. The legal advice was that this was the appropriate way to set them down. We looked again at them because I understood the import of what Deputy Howlin stated on Committee Stage and again on Report Stage. Frankly, I thought the logic of what he stated was strong but the legal advice is that this is the better way to format it.
Amendment, by leave, withdrawn.
Amendment No. 12 not moved.
Bill received for final consideration.
Question proposed: "That the Bill do now pass."
I oppose the enactment of this legislation on Fifth Stage for the various reasons that were pointed out on Second Stage and Committee Stage by all sides of the House. It is an unusual situation where all sides of the House are almost in agreement, but the Government is ploughing ahead with this legislation irrespective of the views expressed on all Stages. It is rather strange that not even a technical amendment was offered by the Government side to show it cares about some of the views expressed on Second Stage. It is rather dismissive of all views contrary to the position of the Department.
The Minister for Enterprise, Trade and Employment, Deputy Martin, indicated at the time of the abolition of the groceries order in November 2005 that he was prepared to listen to various views and was prepared to put certain sections into the Competition Act which would protect the interests of consumers and which would ensure rebates and discounts were passed on to them but which would not allow a situation that would concentrate the market in the hands of a few. By opening up the legislation in the manner in which he has to ensure there are no proper safeguards on predatory pricing, he is putting at risk competition in the local marketplace in the sale of goods and services, allowing big business to supersede all other arguments over small business, and putting at risk the indigenous food and other interests which supply small and big business in this country.
This is a retrograde step in the absence of the protections and the clarification under law required to ensure predatory pricing was banned. If the Minister had no difficulty about the banning of predatory pricing under section 5 of the Competition Act 2002, he should have no problem whatsoever in accepting the views expressed by his backbenchers and the Opposition by inserting an amendment to ensure that what he had stated was, in fact, what the position would be and to give absolute clarity to the issue of predatory pricing in line with what all of us in this House would like to see happening. That was not forthcoming and the obstinate and stubborn manner in which the Minister for Enterprise, Trade and Employment has insisted on this legislation going through does him no service and, unfortunately, does competition in this country no service either.
This Bill is based on populism. There was an outcry about stealth taxes and rising prices in this country last year which, I suppose, was captured most definitively by the work of Mr. Hobbs on television. The Minister's response was not to look at genuine cartels, at what was happening among some of the professions or to take on real vested interest, but by way of populism to make an issue of the 1987 groceries order. The groceries order, which has stood the test of time through successive Administrations of all political hues for 18 years and was found useful by all Administrations, and which was introduced originally by former Taoiseach Albert Reynolds when he was Minister for Industry and Commerce, who was hardly a rampant socialist, served its purpose.
I thought my analysis of the impact on prices, on Second Stage and over the duration of this Bill, provided a compelling enough case that this was not the appropriate target. It was not even responded to.
For nine of the 18 years prices covered by the groceries order increased less than prices not covered and for the balance, all but for the past two years, there was virtually no difference in prices. The notion that this was some significant anti-competitive device recently discovered was bizarre and unproven and no evidence, least of all the tome published by the Minister as justification last year, proved that point. In fact, all shades of opinion across the Joint Committee on Enterprise and Small Business which looked at it felt that if ever there was a document that came to its conclusions first and then built the arguments around the conclusions, the Minister's document was it.
The Minister, in search of populism, is taking grave risks. The real issues voiced by experienced Deputies, former Ministers like the former Minister of State, Deputy Ned O'Keeffe, the Chairman of the Joint Committee on Enterprise and Small Business, Deputy Cassidy, as well as Members across the Opposition benches, were reasoned, sensible, knowledgeable arguments none of which were faced up to or argued against by the Minister. If one reads every utterance of the Minister since he first announced the abolition of the groceries order, as I tried to do, the general view is that he knew in his heart, just like de Valera, that this was the right measure. There is a certain irony, therefore, that it is a successor of de Valera in the constituency of Clare who is left holding the can today. I suppose a burden shared is a burden halved and when those particular chickens come home with bird influenza there will be more than one Minister to carry the can.
This is populist. The notion, from the Competition Authority or from the Minister originally, was that there would be a definitive reduction in grocery prices on foot of this to counterbalance the dangers of predatory pricing, building of dominance, crushing of competition and reduction of choice. Given the case made by such radical organisations as CROSSCARE or the Society of St. Vincent de Paul, which made a compelling case to the committee, the Minister has now abandoned any notion that there will be a quantifiable reduction in grocery prices because he knows we will be measuring and the CSO, which provided us with useful information last year, will be brought back at the end of this year. Perhaps the Minister of State, Deputy Killeen, would give us the yardstick by which to judge and in the concluding phase of this debate would tell us by how much he expects this legislation to reduce the cost of the grocery basket during the course of 2006. If he is so confident that this is the right measure, he should give us that yardstick.
There is no point in me taking up the time of the House anymore. We have made a compelling case. I approached this debate from the start with an open mind. If there was a compelling case I was willing to hear it. The Minister has reinstated many of the provisions of what he wanted characterised as a discredited groceries order. He has reinstated many of the provisions dealing with hello money and other issues. He has not, in my view and in the view of Deputies on this side of the House, dealt effectively with the issue of predatory pricing. He has trusted in European law and European Court decisions to do so. That is a dangerous area to leave unregulated to a satisfactory extent.
I hope my analysis is wrong. I hope it will not lead to increased dominance by one or two big players in the Irish market, the exclusion of choice, the destruction of the small player in the market, and people who are dependent on public transport or who are elderly being totally disadvantaged having to shop in five, ten or 15 years' time in major hypermarkets on the fringes of our towns rather than in community facilities available at affordable prices as is generally the position at present.
I am disappointed that a broader view has not been taken on this on my side of the House. Yesterday I heard the Minister of State make the point that there is a significant number of consumers. That does not make the case to amend the legislation. The consumer will lose out in the short term. The problems in the UK have not been recognised here. The report on the groceries order has many flaws and can be rubbished significantly but it is the basis for change in the legislation.
The consumer will lose out because cartels will operate in the food industry. The two finest indigenous food production counties are Monaghan and Cavan, which the Ceann Comhairle represents, and they will also be losers. The Danish food industry is in major trouble because of the cartoon issue, which is regrettable. Danish products have been taken off the shelves in the Middle East and flown back to Denmark at a major loss to Arla Foods, the major food manufacturer in Scandinavia. Some of these products found their way on to Irish shelves last week, which led to the withdrawal of Irish and British products because they were being sold at a higher margin. This is what will happen to the detriment of small domestic producers and the food industry, which is a relatively small player in the European Union.
Large multiples will be the way forward. Since I took an interest in this issue, I have been unable to cope with the number of telephone calls and newspaper cuttings I have received. Countryview, a British magazine, recently published an article under the headline, “Time to protect small shops from supermarket dominance”. The reporter, Joanna Baker, stated: “A stronger code of practice to protect supermarket suppliers, together with the need for an independent retail regulator and a moratorium on any further supermarket mergers and takeovers, were just three of the recommendations MPs made in the ‘High Street UK 2015’ report...”. Today’s Financial Times carries a story under the headline, “America’s shoppers get selective” in which it is stated, “Consumers are adopting a pick-and-mix attitude towards supermarkets. Tesco and Wal-Mart take note...”.
The groceries order report states Germany, which has the lowest food price inflation of the 15 member states, does not have a ban on below cost selling but this is false, as such a ban is in place. The report makes no distinction between symbol groups and multiple stores. The owners of symbol stores are independent retailers who voluntarily link to a symbol group. The symbol group relationships can be broken, generally with three months notice. It is false to only examine the sales of the symbol wholesaler and not to take into account that these are independent retailers, each making his or her own decisions on how they operate their stores. Independent retailers have a higher market share outside Dublin and prices outside Dublin are consistently lower than those in the capital, according to the CSO. In other words, prices are cheaper in rural Ireland than in Dublin because we have the market.
The report states that in the period since 1996 the rate of inflation in Ireland has been three times that in the UK and almost twice the EU average. This is misleading and, in isolation, gives a false picture of Irish inflation vis-à-vis UK inflation. UK food inflation is higher. Another study should be undertaken and the report should be rewritten. The report claims that the countries with a ban on below cost selling have the highest rate of inflation, which is also false. It fails to mention that, according to the EUROSTAT price level indices, a number of the countries with a ban on below cost selling have the lowest food prices in the EU.
The report rubbishes claims that seven out of ten villages in the UK have no local shops, yet the statistics clearly demonstrate this is the case. More than 70% of towns and villages with up to 1,000 inhabitants have no local shop. Villages such as Rathcormac, near Fermoy, and Kildorrery in my constituency had five or six shops but they are no more, even though each has 1,000 inhabitants on the electoral register. This is a serious scenario. The Department's report quotes an Office of Fair Trading report which has since been withdrawn and a new report is being prepared.
The Department's report fails to mention that the entry of Aldi and Lidl to the Irish market was facilitated by the existence of the groceries order. Without the order, Dunnes and Tesco would almost certainly have targeted the products being sold by Aldi and Lidl for below cost selling activity with a view to eliminating these discounters before they gained a significant market share. On predatory pricing and abuse of dominance, the report recommends that the existing provisions of the Competition Act 2002 should deal with predatory pricing. The report acknowledges that the Competition Act 2002 can only deal with cases where the retailer has a share of 35% of the market or more and that none of the retailers have this level of market share. Nevertheless, it argues that the Competition Act 2002 can provide a safeguard for independent retailers against predatory pricing. This is obviously false. In addition, the report gives the impression that the Competition Authority has been represented on abuse of dominance cases. The Competition Authority has not forwarded files to the DPP on such investigations and no company has been prosecuted for abuse of dominance. There is no reason to believe the authority will change this stance in the future.
Competition between firms is important. Firms comprise individuals who manage and operate them. The report makes no attempt to analyse competition with respect to the ambitions of the market participants.
The Chair is reluctant to intervene but many rulings have been made whereby only a brief comment on Fifth Stage of a Bill is permissible and it must be relevant.
This is brief for the Deputy.
My comments were never more relevant. This is a bread and butter issue.
The Deputy's actions should speak louder than his words. He will be afforded the opportunity shortly.
The Deputy would love to be over here where I am. He has tried hard and failed.
The food industry is a key sector here in terms of employment and trade. More than 210,000 people are employed in the production, distribution and sale of food. A total of 65,000 are employed in the retail grocery trade. The Minister of State's heart is in what we are doing because he comes from the same background as myself. He has inherited this legislation. The Minister for Enterprise, Trade and Employment was successful in the Departments of Education and Science and Health and Children and we are reaping the fruits of his work in the latter Department with his successor implementing his policies.
The Deputy is clutching at straws.
I am extremely disappointed with the way this legislation has been stream-rolled through the House. The Minister of State acknowledged that a significant number of amendments were logical and would have been beneficial but they were not accepted. I am afraid we are handing over the entire grocery trade to big business at the expense of small traders. Nobody will contest the theories on consolidation and economy of scale but small Irish towns and villages will be completely bereft of a grocery service to their inhabitants, who comprise pensioners, families on low incomes and others who do not have transport. They will be expected to travel more than ten miles to a super store to purchase their goods at rip-off prices once the small traders are despatched.
The Bill has clear deficiencies. The definitions of "predatory pricing", "market dominance" and so on have not been dealt with adequately and this legislation has been exposed on all Stages of its passage regarding these issues. That is most unacceptable. The Government has caved in and amended legislation to facilitate IKEA while legislation has also been amended to facilitate incineration companies. In this instance, legislation is being amended to facilitate the grocery trade while further changes will result following the passage of the major infrastructure Bill. People in small towns and villages such as Shercock, Hackballscross and Ballyjamesduff in the north east will not have basic grocery services because of lobbying by big business, which the Government has fallen for again, and that is most unfortunate.
The Minister of State has also missed a significant opportunity to deal with the issue of freelance workers and their right to be collectively represented. They are not high fliers swanning about on our television screens. They are poor people struggling to eke out a living, whether they are freelance journalists, actors, playwrights and so on. There was duplicity in the debate. A Minister told us the appropriate legislation for such change would be the Industrial Relations Act. That is not the case. The Competition Authority, which used a block in this instance, was established under the Competition Bill. This Bill could have adequately dealt with this important issue for significant numbers of people. It is unfortunate that opportunity was not taken. I am disappointed by that and therefore oppose the Bill.
I welcome the opportunity to speak on Fifth Stage. What the Minister has done with regard to this legislation is to give a blank cheque to large retailers here, many of them multinational retailers, to wipe out the smaller players within the industry, squeeze the consumer and ensure retailers get even larger returns than they do currently. What are the annual profits of these large multinationals and major retailers, for example, Dunnes Stores, Superquinn or Tesco? These profits are not disclosed to the public and this gives rise to serious questions.
While we all accept the groceries order was outdated, some key elements of it benefited consumers. The Minister of State may argue that this legislation is pro-consumer but that it does not allow for rebates or discounts to be passed on to the consumer means it is anti-consumer. No safeguards are in the legislation with regard to predatory pricing which is anti-consumer and anti rural Ireland. This legislation is bad for rural Ireland, the elderly and those on the poverty line. The Society of St. Vincent de Paul is very much against it for that reason.
Significant numbers of people in rural areas do not have their own transport, nor, thanks to the Government, access to public transport. They will not have access to basic foodstuffs in their local community or village shop as a result of this legislation. In recent years the Government has closed down much of our post office network. Now, this legislation will close many of our rural shops and on the edge of major towns we will see massive supermarkets——
We cannot have a Second Stage speech again.
I will be brief. Every other EU country has taken the opposite position to the one we are taking. They are introducing, or have introduced, measures similar to the groceries order. We have seen the retail wastelands that exist in the United Kingdom.
This legislation is bad for producers, farmers and suppliers. A survey conducted by Fine Gael last summer highlighted the fact that there is a mark-up of up to 214% on basic food products from the farm gate to the supermarket shelf. The middleman does not benefit from this. Those who benefit are the major retailers. They make huge profits and put the squeeze on smaller retailers, suppliers and primary producers such as farmers. I urge the Minister of State to reconsider his position on this.
The Ceann Comhairle will be pleased to hear that I will be brief. A very interesting confrontation of ideas, worthy of note, took place during the course of this legislation. It was between an unelected, but appointed, lobby group, the consumer strategy group, and the Joint Committee on Enterprise and Small Business, an elected body nominated by this House. As every speaker, both Government and Opposition indicated, the elected representatives spoke about competition and choice in the broadest sense. They spoke about the social consequences of the absence of retailing activity and the economic effects that are beyond the issue of price. The consumer strategy group took an extraordinarily narrow view of retailing, construing it entirely in terms of what has been suggested, namely, an assumed benefit on price, unexpressed in terms of outcomes with regard to time and heavily reliant on assumptions that are proven to not exist, such as assumptions of perfect market.
In that sense we had a very narrow distorted debate on citizen choice, the future structure of retailing, the embedding of retailing in a social and economic milieu and distinctions of rural life in transition to conditions of urban life. These were the legitimate considerations of the committee. On the other hand, the unelected group decided it would go for where it saw its chance, and that is what happened. The second group of people, the Competition Authority, was shown to be informing the debate on a flawed statistical basis to which it never replied.
The point has been made by me, Deputy Morgan, my colleague Deputy Howlin and others that this was an opportunity to amend the Competition Act. Unfortunately, during the debate on Committee Stage we had a distortion of Article 85.1, a misinterpretation of the European Commission's position and a misinterpretation of European competition law. The suggestion that was made during Committee Stage was unfortunate. I have said enough about it and may have been unparliamentary previously on the matter.
Frankly, the suggestion that the owner of a pharmacy is in the same position as a freelance actor who is selling his or her services is wrong. There is an obvious distinction. There is continuity in the asset in one case — the person is selling the same thing under known and predictable conditions which he or she controls. The business is therefore appropriately regarded as an undertaking or commodity. I do not agree with the idea that freelance musicians, journalists, photographers and artists etc. are the same. The example the Minister quoted on Committee Stage involved a ruling in a European Union case concerning opera singers. If he had further investigated the case, he would have found that the case dealt with a company selling operatic services. Therefore, it was legitimately called an undertaking, but not the opera singer.
I find it unfortunate that on Committee Stage my name was mentioned and quoted from an Adjournment Debate. I was described as pained. I stated I had one interest in this matter, namely that my wife is a founder member of the Stanislavsky Studio and a member of Equity. I have known actors, writers and musicians for all of my adult life. This is how I know of the precariousness of their lives. The unworthy suggestion that mine was an instinctive reaction from people who assume that all artists are poor and all barristers are rich is an unworthy statement to put on the record of the Dáil.
I am left in the position where I will now advise the trade unions that are taking part in social partnership not to proceed with any talks unless the Trade Union Act 1941 is amended. We had two choices. It is strictly within the ambit of this legislation at this stage that it could have amended through a new section 4A something that——
The Deputy must conclude.
I will conclude. It undermines the International Labour Organisation convention of 1988 and the entire corpus of trade union legislation. We will now proceed, in the fact that this legislation will be law, with the issue unaddressed. Our only choice is to lobby publicly for the change in the Trade Union Act 1941 and to encourage artists to proceed with the court cases they were forced to abandon on the steps of the court. That is what I will recommend.
Spot on.
The Deputy has gone well outside the scope of this Stage.
The Government has its head in the sand on this issue. In that position one cannot see, and if the head is deep enough in the sand one cannot hear. This is a chronic case of Government tipping its hat to big business. The Minister has allowed himself to be led by advisers and has consequently taken advice that has no basis in fact and no foundation. There is no demand for this legislation. The Oireachtas Committee on Enterprise and Small Business knows there is no demand because it has the proof. It invited various representatives to its meetings and not one of the groups or individuals put forward a request for a revocation of the groceries order. That is the proof. This legislation is bad for the consumer and rural Ireland and will be proven so.
I do not know whether it is appropriate to respond to the points made by a number of speakers, but the Minister for Enterprise, Trade and Employment, Deputy Martin——
I thought the Minister of State had already spoken on Fifth Stage.
The Minister of State is entitled to reply to the points made on Fifth Stage.
Is he?
I have only spoken on Fifth Stage——
There used to be a time when he could speak after each Member but the ruling was changed.
I invite the Minister of State to speak and I am delighted that he has the opportunity to do so.
I have not spoken, in any event. I have merely moved that Fifth Stage be taken and the Bill be passed. A number of points have been made, some of which re-hash arguments made on Second, Committee and Report Stages.
They are no less valid for that.
It is very important to realise that some of the amendments put forward would have had the effect of undermining section 5 of the Competition Act 2002, which would have gone against everything said by many people. The Government was accused of populism amid concerns about stealth taxes and rising prices. There are no stealth taxes. Any taxes which are imposed are done so through this House or by local authorities in an open and transparent manner, so they cannot be described as stealth taxes.
The issue of rising prices is one which is clearly of concern to the Government. It is not my fault if it is not of concern to those on the Opposition benches.
That is unworthy of the Minister of State.
We must remember that under the groceries order of 1987, 2,500 small businesses closed. That is pretty good going in 15 years and even if——
That is like blaming the ambulance for the casualties.
If there were no other reason for addressing this issue except the one I have cited, although there are many other reasons, it is a good one.
The Minister of State should not blame Mr. Albert Reynolds for bringing in the order.
A number of speakers asserted that the reason I am here is that the Minister for Enterprise, Trade and Employment, Deputy Martin, did not wish to deal with this, but I want to address that point. People are aware of the nature of the business being undertaken by the Minister at this point and of the success which his trip to the United States has brought. He would have had no difficulty in being here, no more than I have a difficulty now in representing him.
This does not need to be done now.
The Minister's itinerary was known last week and it would have been quite in order to schedule the legislation for some other time.
The issue of the United Kingdom experience was also mentioned and the lessons to be drawn from that are quite different to those that many people are drawing. The de facto position in the country up to now was that wholesalers were effectively deciding minimum retail prices. There were some advantages for some people in that but there were none for consumers or for small retail businesses.
Deputy Morgan referred to the fact that I said one of the amendments tabled seemed logical to me. It did seem logical to me but I am not a legal person and the strong legal advice was otherwise. I am prepared to accept the legal advice because I do not claim to be a legal expert of any kind.
The IKEA store was another issue mentioned by Deputy Morgan. I go to Ballymun frequently to meet people out there, do functions and so forth and it seems to be an extraordinarily popular concept in the area.
At what cost?
It is also important to remember, with reference to a point made by a number of speakers, that to the best of my knowledge and so far as I have been able to check, not one single large business lobbied for this legislation. In fact, some of the businesses which lobbied against it include some of the largest in the country.
Nobody at all wanted it, then.
The Society of St. Vincent de Paul specifically asked that it not be introduced.
And others.
Allow the Minister of State reply, please, without interruption.
One cannot say that the Society of St. Vincent de Paul is a large business or a representative of big business.
It is clear that Deputy McHugh does not want to hear the truth on this matter. What I am telling him is that I have checked and not one single large business lobbied to——
Who lobbied for it?
——have this legislation put in place.
Who wanted it?
The point to which I am responding is not about who lobbied but the lie put forward by a number of speakers that big business lobbied for this legislation. It did not in so far as I have been able to check.
Nobody here argued that.
The point was made very strongly——
There is no demand for it.
None.
Allow the Minister of State speak, please.
It is the consequences of what the Government is doing that we were talking about.
No, that is not what the speakers said. I am only responding to what was said. I am not responding to the consequences, although I will respond to that as well.
Who said it?
Who said what?
Allow the Minister of State to speak.
A number of speakers said it.
The Minister of State is deliberately misinterpreting us.
No.
Nobody wanted it.
The Progressive Democrats Party wanted it.
A number of speakers have said that this legislation arose on foot of representations by big business——
The Minister of State should listen to Deputy Ned O'Keeffe. He is right.
I am not aware of any such representation.
Deputy Ned O'Keeffe is trying to talk to the Minister of State.
I am aware of representation by big business against the legislation, but not in favour of it.
From whom?
From one of the six largest companies in the country, for one.
Who is that?
Predatory pricing is an issue that we all take seriously and which was discussed at length on Committee and Report Stages. It must be accepted that predatory pricing in this instance is only likely to be such when the dominant player is engaged in it and that is more than adequately dealt with in this legislation and the Competition Act.
Deputy Naughten made the interesting and important point that, heretofore, suppliers, and he was concerned about farm suppliers, had their product marked up by 214%. At the same time, he argued that we should maintain the situation that allowed that to happen. We need to address that very strongly.
I did not say that. My initial point was that the groceries order needs to be reformed. The Minister of State should listen.
He said that as well and that is what we are doing.
No, the Government is abolishing it, which is a very different thing.
Deputy Michael D. Higgins made a number of points about the Consumer Strategy Group, the Oireachtas Committee on Enterprise and Small Business and the Competition Authority. He also spoke about Article 85.1 and the European Commission position with regard to the actors' union, Equity, and others. The Deputy may be misunderstanding the point that was made with regard to rich actors and poor barristers and he has a concern——
I read it from the record. It is on the record.
The Deputy is correct in saying it is on the record.
It was said on the Committee Stage debate.
We did not put it on the record.
The point that was being made is that while this matter is of concern to many of us, and I have previously indicated that it is of concern to me, it has not been possible heretofore to find a means of addressing it which would not result in those who need to have their situation examined and dealt with being the sole beneficiaries. Others who have no such need would also benefit. If a formula can be found to address that, I am sure the Government will examine it carefully and charitably. I certainly would be prepared to consider it, but it is not a matter for me to consider.
The Minister of State should implement the trade union legislation.
The Minister for Enterprise, Trade and Employment, Deputy Martin, asked me to convey his appreciation for the valuable work done by the Oireachtas Committee on Enterprise and Small Business on this issue and also by the participants.
The Minister adds insult to injury.
The work was so valuable that he chose to ignore it.
He also asked me to point out something which I have great pleasure in doing, namely, that the groceries order was the principal factor in driving price competition out of the grocery market for the period since 1987. It did this by creating mechanisms of discounts and rebates which allowed suppliers to fix minimum prices below which most grocery products could not be sold. Everybody knows that is the case.
That is not the case, not in the real world.
Everybody also knows it is the case that 2,500 businesses went to the wall on foot of it. It did not protect small, independent retailers in the manner that is claimed and it did not protect——
Not on foot of it.
It did not protect suppliers because they were faced with secretive, arbitrary and discriminatory demands from retailers——
How does the Minister of State know that?
——which are being defended by Members on the Opposition benches. Reference was made to the planning laws which clearly are not a matter for the Department of Enterprise, Trade and Employment.
Yes, they are.
There were very strong cases made in that regard that may need to be revisited elsewhere.
Can the Minister of State be brief?
At this stage I have taken up less time than anybody else.
We have heard it all before. It is the same old, tired record.
It is nothing but repetition.
I can understand why Deputies would not wish to hear what I have to say. We have heard repetition from all sides and I am simply responding to that. The groceries order had a disastrous impact and this legislation seeks to address the issues which were causing concern in that regard. The Competition Act of 2002 has had many benefits. Some concerns have been expressed regarding that legislation which cannot be addressed in this context but can be addressed in another. The Minister has indicated that he intends to have a well resourced Competition Authority looking after the provisions of this legislation and the 2002 Competition Act.
That will happen once in a blue moon.
I thank the Members of the Opposition for their contributions as well as the Members in the other House. I also thank the staff of the Department, the Parliamentary Counsel and the Office of the Attorney General.
Question put.
The Dáil divided: Tá, 52; Níl, 47.
Tá
- Ahern, Dermot.
- Ahern, Michael.
- Ahern, Noel.
- Ardagh, Seán.
- Brady, Johnny.
- Brady, Martin.
- Browne, John.
- Callanan, Joe.
- Carey, Pat.
- Carty, John.
- Cassidy, Donie.
- Cooper-Flynn, Beverley.
- Cregan, John.
- Cullen, Martin.
- Curran, John.
- de Valera, Síle.
- Dempsey, Noel.
- Dennehy, John.
- Devins, Jimmy.
- Ellis, John.
- Finneran, Michael.
- Fitzpatrick, Dermot.
- Glennon, Jim.
- Grealish, Noel.
- Haughey, Seán.
- Jacob, Joe.
- Keaveney, Cecilia.
- Kelly, Peter.
- Killeen, Tony.
- Kirk, Seamus.
- Kitt, Tom.
- Lenihan, Brian.
- Lenihan, Conor.
- McEllistrim, Thomas.
- Moloney, John.
- Mulcahy, Michael.
- Nolan, M.J.
- Ó Cuív, Éamon.
- Ó Fearghaíl, Seán.
- O’Connor, Charlie.
- O’Donnell, Liz.
- O’Keeffe, Batt.
- O’Malley, Fiona.
- O’Malley, Tim.
- Parlon, Tom.
- Power, Peter.
- Power, Seán.
- Smith, Brendan.
- Wallace, Mary.
- Wilkinson, Ollie.
- Woods, Michael.
- Wright, G.V.
Níl
- Broughan, Thomas P.
- Bruton, Richard.
- Burton, Joan.
- Costello, Joe.
- Coveney, Simon.
- Cowley, Jerry.
- Crowe, Seán.
- Deasy, John.
- Deenihan, Jimmy.
- English, Damien.
- Ferris, Martin.
- Gilmore, Eamon.
- Gormley, John.
- Gregory, Tony.
- Hayes, Tom.
- Higgins, Joe.
- Higgins, Michael D.
- Howlin, Brendan.
- McCormack, Pádraic.
- McEntee, Shane.
- McGinley, Dinny.
- McGrath, Finian.
- McGrath, Paul.
- McHugh, Paddy.
- McManus, Liz.
- Mitchell, Gay.
- Mitchell, Olivia.
- Morgan, Arthur.
- Moynihan-Cronin, Breeda.
- Murphy, Gerard.
- Naughten, Denis.
- Neville, Dan.
- Ó Caoláin, Caoimhghín.
- Ó Snodaigh, Aengus.
- O’Dowd, Fergus.
- O’Sullivan, Jan.
- Pattison, Seamus.
- Penrose, Willie.
- Perry, John.
- Ring, Michael.
- Ryan, Seán.
- Shortall, Róisín.
- Stagg, Emmet.
- Stanton, David.
- Twomey, Liam.
- Upton, Mary.
- Wall, Jack.
Tellers: Tá, Deputies Kitt and Curran; Níl, Deputies Neville and Stagg.
Question declared carried.
A message shall be sent to the Seanad acquainting it accordingly.