I wish to share time with Deputy O'Donnell.
Competition (Amendment) Bill 2007: Second Stage (Resumed).
Question again proposed: "That the Bill be now read a Second Time."
Is that agreed? Agreed.
I congratulate Deputy Higgins on bringing forward this Private Members' Bill which is timely. It raises fundamental questions about the Competition Act, which will have to be revisited.
One issue to which the Minister of State, Deputy Michael Ahern, referred yesterday was the fact the Competition Authority took a view that self-employed actors and freelance journalists were undertakings within the meaning of the Competition Act. I understand this decision was more or less forced on SIPTU under the threat that its offices would be visited by the Competition Authority and that SIPTU is not in agreement with this definition. I understand several rulings of the Labour Court upheld this decision. The Minister of State responsible for this area should clarify what the Minister of State said yesterday.
As one involved in some documentary-making, I can understand the relevance of having set charges. When one is calculating the budget for a documentary, the exact costs would be known rather than one having to negotiate separately with individuals. I can see merit in a consideration of this part of the Competition Act.
In the short time available to me, I wish to refer to the problem faced by pharmacists throughout the length and breadth of the country. From discussions I have had with a number of pharmacists in my constituency, it is definite that pharmacies will close if the HSE position is not changed. Pharmacists are quite open about revealing their account books and showing that if matters change to their disadvantage, staff will lose their jobs, pharmacies will close and pharmacists will seek employment in bigger pharmacy units. It is important that this matter is resolved.
As pointed out yesterday, the union is prepared to go to the table without any preconditions or predetermined outcomes, and it hopes that the HSE would do likewise. I call on the HSE to agree to this. The union has proposed that talks on a new pharmacy contract under an independent chairperson should commence immediately. The purpose of these talks would be to reach agreement on all aspects of the contract, including an appropriate pricing structure for the delivery of pharmacy services. This had previously been agreed with the HSE at a meeting in November.
When agreement is reached on an appropriate pricing structure, the matter could then be referred to the proposed new arbitration system, which the Minister for Health and Children referred to in the Dáil on 21 November. It is hoped that such a body or system will provide an independent and fair assessment of all the issues involved and could then make recommendations to the HSE on pharmacists' remuneration.
There is no indication that the HSE is prepared to proceed on this basis. This affects not only the pharmacists in question, but also those who depend on pharmacists for vital services. If the medical card scheme becomes unviable, what will happen to all those dependent on medicines dispensed by pharmacists?
The amount of money pharmacists are getting is minuscule when compared to the overall health budget, but their role is vital given that many pharmacists operate in place of a doctor, and a good pharmacist can be very much part of primary health care. If we lose this expertise in many parts of rural and urban Ireland, where there is a great dependency on medical cards, the whole system will be affected.
This matter must be resolved as soon as possible. The union has been more than accommodating in the effort to find a solution.
I support my colleague, Deputy Deenihan. I congratulate Deputy Higgins and the Labour Party on bringing forward this Private Members' Bill. We may not vote for it due to our legal opinion, but we will not vote against it. Our key point is that the Bill is timely, particularly with regard to pharmacists.
The Government and the HSE are completely out of touch. If I was to point to a system where there is no waiting list and no distinction between public and private, one would think it was a great system. That is the system pharmacists are providing. The HSE gave a commitment in November that it would enter into an independent process but it has reneged on this in a very underhand way. It came out publicly to state it would agree to an independent system but that it wanted the pharmacists to agree to a pricing structure before they entered an independent process. It is a joke. The problem is that there is no commitment from the HSE or the Government to resolve this issue.
The Health Act 1970 was introduced to replace a system, whereby those on medical cards were dealt with by doctors who dispensed medicines. That system was replaced so that dispensing was carried out by pharmacists, who have provided a very good system to date, but it appears the HSE is intent on dismantling this system.
Many are not aware that pharmacists make a 17% gross profit through the general medical scheme, GMS, which is not a phenomenal return. Furthermore, the areas that will be affected will be those where the GMS forms a large part of the pharmacist's business, such as vulnerable rural areas and urban areas of high population. This will force the closure of family-run, community pharmacies. While the big multiples will come into the market, pharmacies in local towns will no longer exist.
The Government must honour its commitment and bring forward an independent chairperson who will sit down with the HSE and the IPU to devise a system for a pricing structure. This should then go to an independent arbitration body which will recommend a pricing structure to the HSE.
I find one point amazing. The HSE and the Government propose to enter into contracts with individual pharmacies, which will create a chaotic system at the least. The IPU has done a good job up to this, as has the IMO with regard to the GMS, which was an efficient system.
Competition law was brought forward to allow the consumer to have choice.
Correct.
It was not brought forward in order that the Government could dismiss an efficient and effective system. On a practical level, why would the HSE, with the Minister's approval, enter into negotiations that will create a bureaucratic nightmare and make the HSE worse than it already is? The delivery of service on the ground will be a disaster and pharmacies will be destroyed.
Many young pharmacists have set up or bought into pharmacies, and have borrowed to the hilt to do so. There are many family-run pharmacies which provide a fantastic services for communities. As a matter of urgency, the Minister for Health and Children, Deputy Harney, must force the HSE, particularly Professor Brendan Drumm, to honour his commitment to set up this independent process and sit down with the IPU. The IPU will consider introducing cost reductions but the Government needs to move. We do not want a situation where it abdicates its responsibilities to patients on the ground and pharmacists nationally.
I wish to share time with a number of other Deputies and understand the allocation of times has been agreed by the House.
Is that agreed? Agreed.
I compliment Deputy Higgins on bringing forward the Bill because there is merit in certain aspects of it. I listened carefully to his contribution last night which was delivered with the usual passion and commitment that we have grown used to hearing from him. In the context of the Government's response and having examined what the Bill entails, it is complex in terms of an overall solution. The question is whether there is a resolve to address all the issues concerned, particularly as regards section 4. Deputy Higgins referred to social partnership. All parties involved must come to the table, which brings me to his point about the commitment given by the Taoiseach in March 2006. It was given in good faith. The action that should have followed would have drawn the various parties together, including the Department concerned, to examine the issues and determine a solution in the context of our legislation and EU law. I am aware that there is an ongoing review of the 2002 Act, which should be at the centre in examining the issues raised. Deputies are demanding action, which should be taken as quickly as possible in consultation with all the stakeholders involved.
Other speakers have, rightly, focused on pharmacies. Section 4 was never intended to drive anyone in the opposite direction, to seek legal advice which is often one step beyond common sense. A common-sense approach such as that outlined by Deputy O'Donnell should be pursued by the HSE.
And the Government.
And the Government, yes. Nobody should be excluded because we are all stakeholders in finding a solution. We are all aware of the serious investment made by pharmacies as regards business transacted and the valuable service delivered to local communities. In addition, there has been ongoing development of pharmacies, as there is a need to continue to invest heavily in them. We must also acknowledge that over 300 pharmacies have been created and extra staff have been employed because of competition in the sector. In that way, people get good value for money from such outlets. While remembering all this, the HSE, as the authority which will engage with pharmacies, needs, with the Government, to bring about the required solution.
Certainty is needed for such businesses, employment and investment pending. The uncertainty and doubt should be taken out of the equation. Whatever pressure can be brought to bear by way of this debate which was facilitated by bringing the Bill before the House, if applied properly, will encourage the HSE to see that there is almost cross-political support for some form of initiative to create the vehicle to deliver a solution to the problem. In that context, many people who have their prescriptions filled at pharmacies are being encouraged to raise the issue because there is doubt about the overall problem.
There is uncertainty.
We need to remove that uncertainty and doubt in their interests because those who attend pharmacies are generally ill.
They have a genuine concern.
I acknowledge there is an issue concerning section 4 and support the general ongoing review of the Bill in that context. Equity is a different issue but we must understand the complexities and try to focus on the intent of the Bill because activity does not replace action which is required.
I do not subscribe to the remark made to the effect that what Deputy Higgins was proposing was outside the law.
I thank the Minister of State.
I endorse the comments of the Minister of State, Deputy McGuinness. In the debate on competition law nobody envisaged that the law would be applied in this manner. That is why it is so important to review the Competition Act. To this end the Select Committee on Enterprise, Trade and Employment has adopted that goal as probably the major element of its work programme for 2008, given the detailed work that will have to be considered. When something like this occurs that has not been envisaged, it shows the complexity of legislative matters. Competition law generally is changing so much because we must manage the interests of competition, while protecting consumer rights. I look forward to considering these matters in the context of the forthcoming review.
I join previous speakers in commenting on the Pharmacies Act. I remember the morning when Professor Drumm appeared with 20 HSE advisers. He had a very cool and calm persona the whole way through, in spite of everything that was thrown at him. He remained confident but when Deputy Higgins and I inquired about the IPU, that cool and calm persona disappeared. The flashes of anger apparent that day were extraordinary in the light of other issues ongoing at the time concerning cancer services. The attitude of the HSE has been incredibly frustrating, particularly with regard to its management of the IPU-pharmacy issue. It has consistently provided us with misleading information on the make-up of the GMS scheme and the impact of changes to it, particularly with regard to community and rural pharmacists. We were led to believe the GMS scheme would account for 40% of the average pharmacy's turnover when, in fact, for many in rural and disadvantaged areas, it accounts for a minimum of 80% to 85%.
As regards this specific issue, we were advised by the HSE that the illegal issue had arisen in the context of a legal opinion sought by one of the wholesalers. Some five weeks ago I asked the HSE's parliamentary affairs division what companies had sought that information and what wholesalers had provided it, but I have yet to receive a response. Even the HSE's update that Members received last week was incendiary in terms of its tone and content. It was not the kind of letter someone who was serious about negotiation would have publicly distributed. I very much regret that it was done.
I understand there are proposals, according to which the HSE intends to remove wholesalers from the chain and encourage pharmacists to deal directly with manufacturers. That is a bizarre system because in most retail systems a wholesaler is involved. Unless we are going to adopt a Dell or Ryanair approach to medicine, that is not the way to go. Wholesalers are providing an excellent service which is particularly suited to community and rural pharmacies. To remove them from the equation would reduce the level of service available to pharmacies and patients.
I endorse the remarks made by the Minister of State. It is ironic that competition law has been mentioned in the discussion on pharmacies, but it is good that we have finally been able to raise the issue in the Chamber. It has been well debated at the Joint Committee on Health and Children, at our own parliamentary party meetings and within other political parties.
The Shipsey process should be allowed to grow. I ask the Minister of State to encourage the HSE to give that process time to grow. The IPU is willing to engage with it. Earlier the HSE lawyers agreed a programme under the Shipsey process but when they went back, HSE management completely disowned the agreement reached by its own lawyers. That does not instil much confidence in the HSE's approach. I call on the HSE to approach the negotiations with a new willingness to try to reach a deal. Everybody agrees that we need to review and reform the pharmacy, GMS and drug payments schemes. Pharmacists, the HSE and Members of the House agreed that was so but the manner in which it is being done is akin to taking a sledgehammer to a nut. We cannot allow that to happen, given that pharmacists form such an important part of the health service. I hope that in the coming days before Christmas the HSE will respond to the latest initiative from the IPU in the spirit intended — it was communicated to us yesterday — otherwise the issue will be back before the House with more amendments and debates, while patients suffer.
I generally agree with Deputy Calleary's comments on pharmacists and I take issue with the HSE's approach to negotiations in that regard. I encourage the executive's representatives to use the Shipsey process to best advantage. However, the Bill is not entirely relevant to that process. As Deputy Calleary said in another context, the Bill is like using a sledgehammer to crack a nut. It is a naive attempt to apply the hard fought for rights and privileges of trade unions to associations of self-employed professionals. It is an extraordinary stance for the Labour Party to take but it is not unprecedented. Its stance on the Personal Injuries Assessment Board Act last July would have had a similar effect and it resulted from similar professional lobbying.
A professional body is capable of being an association of undertakings within the meaning of Article 81 and section 4 of the Competition Act. As such, the rules and decisions of professional bodies are subject to competition law. A trade union of workers is not capable of being an association of undertakings. However, professional bodies are also aware that not every agreement they enter into or decision or concerted practice necessarily infringes competition law, which has never applied to workers. Workers do not come within the definition of "undertakings and competition policies" and, therefore, trade unions can never be described as "associations of undertakings". Does the Labour Party believe self-employed solicitors or pharmacists, who may be significant employers themselves, should be given the same rights and privileges as trade unions? The party was not established for this and I do not believe in it.
Section 2 would allow any group of professionals, including solicitors — I am one myself — to fix prices between themselves, restrict supplies and do anything they wish, which ultimately would be anti-consumer. It is an extraordinary provision to propose in legislation when we are trying all the time to reduce professional costs to consumers, reduce inflation and make Ireland a competitive country. The section is of no benefit to trade unions and would give professional employers an advantage over their employees who are often also their customers.
Section 3 is also extraordinary. It proposes to bring the Members of the Dáil into the process of negotiating with professional bodies when the State enters into contracts. This is unreal and, as legislators, we should have no direct role in this area. It would not achieve best value for taxpayers. I do not agree with the HSE's approach to its negotiations with the pharmacists nor do I agree with the Competition Authority's heavy handed approach to the IPU, which is a complete waste of resources. The authority's staff should pursue genuine cartels and price fixing, which, unfortunately, exist throughout society, despite the best efforts of the Government and the authority. However, that does not mean trade union protections should automatically be given to employers or self-employed professionals. Best value for money must be achieved on behalf of the taxpayer and, therefore, permitting professionals to band together on price would not achieve this end. However, I agree there are anomalies, which can be dealt with in the near future on the completion of the review of the Competition Act. I include non-PAYE contract workers such as some, but not all, actors and journalists in that regard.
Did the Deputy not supply a script?
I wrote this script. I practise in this area.
Why does the Deputy not expand? He has interesting views on the Labour Party.
I am astounded that I am in general agreement with Deputy Varadkar's comments last night and I commend him for his honesty on this issue and on a number of his proposals. We often disagree on various issues but some of his comments made sense. I also read the European case law to which Deputy Michael D. Higgins referred in his contribution on the Internet earlier and I cannot for the life of me see its relevance to competition policy, competition law and its implications for self-employed professionals.
I welcome the opportunity to contribute to the debate and I apologise for my inability to attend yesterday evening.
As the House will be aware, the main objective of competition policy is to prevent and remove distortions of competition resulting from the actions of companies or public authorities, thus enabling markets to function effectively. A regulatory framework that upholds effective competition increases the competitiveness of industry and induces firms to innovate and enhance their efficiency and thus enables them to compete more efficiently in home and international markets. Competition reduces price differentials and avoids waste of resources. A dynamic business environment that ensures competition sets incentives to innovate and foster productivity growth. Effective competition in "home markets" also prepares companies to compete internationally. A competitive economy not only ensures the optimal functioning of the European market and the growth and competitiveness of European industry, it also creates benefits for consumers and society as a whole. Consumer welfare is at the heart of competition policy.
The Bill arises from an investigation conducted by the Competition Authority between March 2003 and June 2004 regarding possible price fixing among self-employed actors and advertising agencies. In this case, the authority found that an agreement between Irish Actors Equity SIPTU, on behalf of the actors, and the Institute of Advertising Practitioners in Ireland, on behalf of advertising agencies, was in breach of competition law in that it provided for both specific fees for services rendered and various other terms and conditions. In August 2004, the authority published its decision and the acknowledgement and undertakings made to it by both Irish Actors Equity SIPTU and the Institute of Advertising Practitioners in Ireland in which both parties agreed not to fix fees and to comply with the provisions of the Competition Act 2002.
The authority's investigation centred on section 4 of the Competition Act, which prohibits anti-competitive agreements, decisions and concerted practices. Section 4 applies when "undertakings" are engaged in arrangements which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the State. Section 4(1) states:
Subject to the provisions of this section, all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the State are prohibited and void, including in particular, without prejudice to the generality of this subsection, those which (a) directly or indirectly fix purchase or selling prices or any other trading conditions . . .
Section 3 of the Act defines an "undertaking" as "a person being an individual, a body corporate or an unincorporated body of persons engaged for gain in the production, supply or distribution of goods or the provision of a service". This definition has been in use in Irish competition law for some time and is supported by EU case law. To establish a breach of section 4, the authority must demonstrate that there is an agreement, decision or concerted practice; that the parties to that agreement, decision or concerted practice are undertakings; and that the object or effect of the agreement, decision or concerted practice is to prevent, restrict or distort competition.
In this case, the parties did not dispute the existence of an agreement. The agreement was contained in a document entitled 2002 Agreement on Minimum Fees Effective from 1 October 2002. The institute did not contest that it was an association of undertakings and that its members were undertakings in their own right. The issue the Competition Authority then considered was whether actors were "undertakings" and whether Irish Actors Equity was an "association of undertakings" for the purposes of the Act. It was a question of whether the actors in question were self-employed independent contractors, who are subject to the Act, or employees, who are generally not subject to the Act. The authority considered this issue to be particularly important in this case where the trade union has both employed persons and self-employed independent contractors as members. The authority stated in its decision that, while it was perfectly legal for a trade union to represent employees in collective bargaining with their employers, its trade union mantle could not exempt its conduct when it acts as a trade association for self-employed independent contractors.
The authority also stated that if one were to take an inflexible approach and find that all trade union members were exempt from the Act, the protections afforded to consumers by the Oireachtas in enacting the Competition Act could easily be bypassed in that associations of independent pharmacists, publicans and barristers, to name but a few, could obtain sanctuary for their members by adding "union" to their name and obtaining a negotiating licence. It is important to understand that the authority carefully considered a number of factors before reaching its decision.
On the question of whether actors are "undertakings" within the meaning of the Competition Act, as a starting point, the Competition Authority considered whether the Revenue Commissioners treated actors as employees subject to PAYE or as independent contractors. The authority's investigation revealed that the vast majority of actors in the State are not treated as PAYE employees. It also considered other factors, such as the following: actors providing advertising services generally are not obliged to work for a single advertising agency, as they may work for several at the same time; such actors generally do not receive the benefits one usually associates with a contract for labour. For example, they generally do not receive holiday pay, health insurance, maternity leave etc.; such actors do not generally have employment security; such actors are free to accept or decline specific work as they see fit; and actors generally are not thought of as employees of a particular agency.
In light of these factors the Competition Authority took the view that actors are independent contractors and, therefore, are "undertakings" subject to the Competition Act. However, the authority acknowledged that there may be some actors who have genuine contracts of service and who are therefore employees, as is the case with some musicians. However, its investigation revealed that the vast majority of actors providing advertising services under the agreement that it examined were independent contractors and, therefore, undertakings. Having found the actors to be undertakings, it followed that Irish Actors Equity in this case was an association of undertakings and subject to the Competition Act.
The Competition Authority may enforce competition law by seeking appropriate civil remedy in the High Court or by recommending the prosecution of a criminal action by the Director of Public Prosecutions. Generally, the authority pursues a criminal prosecution only where there is clear evidence that parties are in breach of the more serious hard-core provisions of the Act.
Although the authority's investigation revealed an element of price-fixing, it elected, in this instance, to pursue civil relief. However, prior to the commencement of proceedings, the parties expressed their willingness to address the authority's competition concerns and signed undertakings. As I said earlier, these undertakings are appended to the authority's decision, which is published on its website. The authority also acknowledges the right of Irish Actors Equity to represent employed actors in collective bargaining with employers. It is clear that the Competition Authority carefully considered many factors in arriving at its decision in this case. In exercising its statutory functions, which this House bestowed on it, the authority did not lightly arrive at its decision.
The explanatory memorandum accompanying the Bill states that if the Competition Act 2002 applied with full force and effect to trade unions and their members, then trade unions would revert to their old common law status as unlawful "combinations" and trade union leaders would be prosecuted as parties to a criminal conspiracy.
I would like to refer to the laws governing freedom of association and trade union regulation. The law relating to trade unions falls into two distinct phases — statutes enacted mainly between 1871 and 1906 in order to secure trade union freedom and remove trade unions and their activities from the operation of the law; and statutes enacted since 1940 which sought to introduce a measure of public regulation of trade unions. Also, the Constitution of Ireland, which came into force in 1937, has had an important impact on industrial relations law and practice. A significant body of case law has developed in regard to the freedom of association guaranteed in the Constitution, as it applies to the activities of trade unions. The principal statutes governing the activities of trade unions in Ireland are the Trade Union Act 1871, the Conspiracy and Protection of Property Act 1875, the Trade Union Acts 1941, 1971, and 1975 and the Industrial Relations Acts 1990 to 2004.
Trade unions in Ireland derive their legal status largely from the Trade Union Act 1871, which provided a measure of protection for bona fide union activities and removed the taint of illegality from them. The 1871 Act also introduced a system of voluntary registration for trade unions. Unions could register with the Registrar of Friendly Societies but in order to do so they were required to have written rules setting out their objectives, benefits and so on. Registration confers certain powers and advantages on unions, which are not enjoyed by unregistered unions.
The relevant provision in the Irish Constitution in regard to freedom of association is Article 40.6.1°, which guarantees liberty for the exercise, subject to public order and morality, of "the right of citizens to form associations and unions". However, laws may be enacted for the regulation and control in the public interest of the exercise of that right. Article 40.6.2° provides that laws regulating the manner in which the right of forming associations and unions may be exercised shall contain no political, religious or class discrimination.
The constitutional guarantee of the freedom of association has been considered in a number of precedent-setting legal cases, which have had an important bearing on the conduct of industrial relations in Ireland. The courts have established the principle that a freedom or right to associate necessarily implied a correlative right not to join any trade union or a particular trade union.
Trade union legislation enacted since 1940, in contrast to earlier legislation, sought to introduce some regulation of trade unions by the State, principally in the form of a system of licensing of unions. The negotiation licence requirement sought to introduce some degree of regulation into a situation, where there was a large number of unions, many of them small, a considerable degree of union rivalry, which resulted in difficult inter-union disputes, and a tendency for disaffected groups of members to form breakaway unions. These measures, which were fully supported by the wider trade union movement, were designed to facilitate effective and stable trade union structures and promote more orderly industrial relations.
The Trade Union Act 1941 made it obligatory for any body of persons wishing to engage in collective bargaining to hold a negotiation licence. Various conditions apply to the holding of such a licence. Once a trade union satisfies all the conditions, the Minister of the day will grant it a negotiation licence.
The legalisation of the activities of trade unions by the Trade Disputes Act 1906 gave trade unions general immunity from action in tort against them. Under the Irish common law of tort, employers would otherwise have a right to sue trade unions for loss or damages arising from trade union activities. For persons acting, in the words of the Act, "in contemplation or furtherance of a trade dispute" it gave immunity from liability for the torts of conspiracy to injure, inducement of the breach of a contract of employment and interference with the trade, business or employment of another. It also legalised peaceful picketing in industrial dispute situations. The Act did not confer a positive right to strike or to organise industrial action; it merely immunised against civil liability. Later the Trade Union Act 1941 restricted most of the immunities to trade unions holding negotiation licences and the members and officials of those unions. The 1906 Act was repealed by the Industrial Relations Act 1990, but its main provisions were re-enacted.
The Trade Union Act 1941 sets out restrictions for the carrying on of negotiations for the fixing of wages and so forth. The proposed Competition (Amendment) Bill 2007 would exempt members of the first type of body, both employed and self-employed, from the requirements of section 4 of the Competition Act 2002 in regard to collective bargaining, but would not exempt members of the second type of body. In that Act there are two types of bodies which can carry on negotiations on the fixing of wages or other conditions of employment.
I agree with the Deputy that collective bargaining by trade unions on behalf of their members is actively encouraged as a bedrock of social partnership. Bargaining can take place, for example, at individual level between an individual worker and his or her employer or at collective level between a group of workers and their employer or between an employer or employers' association and one or more trade unions. Under this process, standard matters such as wages or hours of work are determined and, in addition, some collective agreements lay down procedural rules that govern the conduct of industrial relations. Thus, voluntary bargaining and not the law has been the primary driver of regulation in the employment relationship in Ireland. My concerns regarding the provisions of the Bill also encompass certain reservations regarding the approach to extending or granting protections to the self-employed through the device of what is commonly understood as providing immunities to trade unions in the carrying out of their collective bargaining functions.
A major degree of institutional and trade union reform and protections were included in the Industrial Relations Act 1990. Since then more than 20 new and amended legislative provisions have been enacted and they have widened the scope of employment protection both collectively and individually. These have resulted from initiatives from various Governments, the updating of Irish law, the transposition of European directives and the delivery of various commitments in the respective social partnership agreements.
It would not be appropriate, in my view, to single out a specific individual or group of self-employed professionals, through the mechanism of an amendment to the Competition Act 2002, to legislate for their particular employment status or bargaining position. I am not unsympathetic to the problem identified arising from the decision of the Competition Authority but this issue requires further detailed analysis and assessment on a much broader basis than the position set out in the context of this debate.
During the Dáil debate on the Consumer Protection Act earlier this year, Deputies may recall that I indicated my intention to review the operation of the 2002 Competition Act and that I would bring forward proposals for legislative change where it is warranted. In October, I announced a public consultation on the operation and implementation of the Competition Act 2002. In addition to publishing newspaper advertisements requesting comments, observations and submissions from any interested parties, we also wrote directly to a number of experienced competition law practitioners as well as to business representative groups and the Irish Congress of Trade Unions requesting their input into the review process. The end of year has been set as the deadline for receipt of all submissions.
I ask the House and, in particular, Deputies Higgins and Stagg to allow the proposals contained in the Bill, including their wider European Union implications, to be examined in the context of this overall review. That is the context in which we would favour consideration of the issues raised in this debate. To separate, select, identify or specify one category of the self-employed, albeit combined within a particular union, is not the best way to deal with the issues that have arisen. They are complex and connected to the relevant EU directive, which governs the overall legislation we enact in the Oireachtas.
I wish to share time with Deputies Upton, Jan O'Sullivan, Sherlock and Ciarán Lynch.
That is agreed.
I am glad the Minister referred to the constitutional right of free association, a right that was hard won by the labour and trade union movement in this country and others and is fundamental to this debate. I congratulate my colleague, Deputy Higgins, on introducing this Bill. It is important to note that the European Court of Justice, with regard to the Viking case this week, reaffirmed that a fundamental right of association takes precedence over other rights, such as trade and competition law rights. This is an important development that was not available when Deputy Higgins drafted this Bill but which informs the conclusions I heard the Minister reaching with regard to his promised review.
The pharmacy dispute is inexplicable to many ordinary people. It appears bewildering to them that incredibly well paid hospital consultants and general practitioners are able to negotiate collectively with the HSE but the pharmacies cannot do so. The pharmacies deliver a community based service. People can call to the pharmacy, discuss with the pharmacist how their medication is working and get general medical advice with their prescription. Pharmacies are regarded as a vital element in community health services.
The HSE in this dispute appears to be hiding behind a very willing Competition Authority, which, since its creation, has poked its nose unsuccessfully into a large number of areas. However, none of the initiatives it has taken, ranging from stopping the Irish Kennel Club taking certain actions with regard to pedigree dogs to the Irish League of Credit Unions, where it sought more competition among credit unions, has led to lower prices and better services and value for consumers.
Hear, hear.
What is the logic of the Competition Authority? The Competition Authority was a special creation of the Progressive Democrats. The Progressive Democrats are gone but the Competition Authority is not. Everybody wants governments to take strong action against powerful businesses which abuse their position of prominence and dominance to charge higher prices and give bad services to consumers. There are many such examples in this country, including the banks, insurance providers, cement suppliers, the construction industry and the owners and developers of lands for development. All of them have managed in recent decades to charge consumers significant prices for services provided, but in none of their cases has the Competition Authority sent them so much as a Christmas card. Instead, organisations such as the IPU, as well as the breeders of pedigree dogs, are raided by the Competition Authority. I am glad the Minister will review this outfit.
I was not aware of that.
They are a soft target.
The Minister probably does not remember the actions taken against the Irish Kennel Club and breeders of dogs.
On both sides of the House, both in Fianna Fáil and Fine Gael, there is a group of new neocon Deputies who are very influenced by the Republican Party right wing in the United States. We heard some on this side of the House speak last night, while some of the Minister's colleagues spoke earlier. The point is that in Ireland the pharmacy provides a valuable service. There is a legal problem and this Bill seeks to remedy it. A number of Ministers have said that the Labour Party Bill is not perfect. So be it, but they have the resources to correct the Bill's imperfections. Deputy Higgins is willing to have the Government accept the Bill and use its resources to work on and correct its defects.
The Health Service Executive is, in effect, eroding the traditional independent pharmacy in this country. I suspect the HSE would be happier dealing with a single pharmaceutical network of companies, many of which in turn would own the pharmacies. That would be the end of the independent pharmacy sector. Deputy Higgins spoke about the impact on Actors Equity. The pharmacy sector is an important adjunct in people's everyday lives as a place they can go for medical advice.
This Bill is timely. The comments of the Minister, Deputy Martin, and the Minister of State, Deputy McGuinness, are somewhat conciliatory and, in the context of the European judgment reaffirming the right to free association as a fundamental right, I hope they and the Government will reconsider their approach to the Bill.
I compliment my colleague, Deputy Higgins, on bringing forward this Bill. It is brought forward, first, because section 4 in the Act is over-restrictive in its interpretation and, second, to facilitate negotiations to address the dispute between the pharmacists and the HSE. We have raised this matter on a number of occasions in the Chamber and I have done so as the party's spokesperson on health. It has also been discussed in the health committee.
Despite various attempts to have the issue addressed, significant progress has not been made. We welcomed the fact that extra time was given to address the issues. The new regime was to be implemented on 1 December so there has been some success in having the decision postponed. Essentially, however, the HSE is trying to push through its view on what the prices of medicines should be, without any negotiation. The IPU said it was prepared to go to the negotiating table without any preconditions or predetermined outcomes. Anybody would consider that a reasonable approach, yet it is not accepted by the HSE. Indeed, the HSE is not even accepting the advice of its financial advisers, Indecon, which said that the timing of significant changes is crucial and that the changes and the impact of the changes should be evaluated in advance in connection with key stakeholders. That advice clearly was not taken. There is now an attempt to bully a group of people into a take it or leave it deal which has serious implications for their livelihoods. Nobody would expect a group of people to accept that.
Last night the Minister of State, Deputy Michael Ahern, said the Labour Party was, in effect, championing price fixing, which is a serious crime carrying a maximum prison sentence of five years. I welcome the fact that other Ministers have been a little more conciliatory. If this is a case of price fixing, the HSE is doing it. The HSE wants to fix prices without negotiations and the Competition Authority does not appear to have a problem with that. However, it raided the offices of the Irish Pharmaceutical Union and removed its computer server for a few days. It is absolutely disgraceful that the Competition Authority should act in this manner.
Somebody should tell us who complained to the Competition Authority about the IPU. Who decided that the Competition Authority should raid the IPU in this way? It is beyond belief that it should raid the Irish Pharmaceutical Union on this issue, particularly as the HSE is, in effect, trying to fix the prices. It is ludicrous and in no way fulfils the objectives of the Competition Act. For that reason, this Bill should be accepted and, by all means, modified. This interpretation of the Competition Act is unacceptable.
The Minister of State made his accusation last night but the Taoiseach cannot stand over the attitude of his Government and the HSE in this regard. The Taoiseach has a great reputation for sorting out disputes such as this and for having a conciliatory approach in fixing them. However, the Government appears to be standing back on this issue. Many Government Deputies spoke about what the HSE has done but the Government established the HSE and its actions are taking place in a context where the Government is simply standing by and watching what is happening. In that sense, there is an onus on the Government to address this issue and ensure a breakthrough is achieved in the negotiations.
All the Irish Pharmaceutical Union wants is a fair process through which it can negotiate on behalf of its members. If the Competition Act is an impediment to that, the Bill before us is a way to remove the obstacles and we present the legislation in that spirit. However, in the broader context of resolving the dispute, it is essential that a mechanism be found to resolve the differences between the HSE and the pharmacists. The latter have a fair case and, in some instances, do not make any profits whatsoever from dispensing to medical card holders. In that respect, the IPU has a right to negotiate on behalf of its members. If a mechanism is not found to address this issue, the most vulnerable patients will suffer because they are dependent on pharmacists for filling their prescriptions and addressing their needs under the drugs repayment, medical card and methadone schemes. On this, the last day before the Dáil's Christmas recess, we ask that a mechanism be found to resolve the dispute before it affects patients.
I welcome the opportunity to speak on this Bill, which addresses the fundamental right to collective representation and, in particular, the anomaly which currently exists for pharmacists in their attempted negotiations with the HSE. I deliberately say "attempted" because the IPU is clearly making every effort to negotiate with the HSE but the latter has dug in and is refusing to talk. The president of the MPSI has been referred to by almost every speaker. All sides of the House would agree with his statement that the union is prepared to go the table without any preconditions or predetermined outcomes. That is the fairest observation possible and the HSE should at the very least consider that reasonable and fair approach.
The proposed amendment to the Competition Act will serve to ensure the legislation cannot be used to undermine the right to collective representation of atypical workers. It is ironic that pharmacists are permitted to be members of a trade union which, in effect, is not allowed to negotiate collectively on their behalf. That is at the heart of this debate. Other European countries have found a way around the impasse, so it is not impossible to negotiate. We could follow the example of our European neighbours by amending competition law to allow recognition of pharmaceutical bodies as unions rather than associations of undertakings for the purpose of negotiating a collective agreement with the Government. Despite what the HSE and some on the Government benches have claimed, Irish competition law rather than European law needs to be amended. Other EU countries, including France and the Netherlands, have amended their competition laws to allow representative bodies negotiate with full union rights. If they can do so within the European Union, surely we can also address the issue.
The uncertainty regarding payments by the HSE to the pharmacy sector has caused significant disruption to the customers who rely on pharmacists for the delivery of services beyond simply filling prescriptions. The unilateral decision by the HSE to impose new cost saving procedures was short-sighted. The one issue community pharmacists raise repeatedly is the disdain with which they have been treated by the HSE, which chose to seek a headline about €100 million savings on the drugs payment scheme instead of taking hard decisions by negotiating and seeking compromises. The outcome for pharmacists of the pathway proposed by the HSE in a heavy handed and one-sided way will be uncertainty and threatened incomes. The knock-on effect is the fear that has been generated among vulnerable individuals who depend on medical cards or methadone supplied by pharmacists. The provision of methadone by pharmacists has been a progressive and much needed service in the community and the services provided by pharmacists to elderly customers in particular cannot be overlooked. I have been approached by a number of constituents who expressed concerns about what will happen if the services are not provided locally. They have been vocal in their support of their community pharmacists, who go beyond simply providing prescriptions and offer support and good advice.
It is up to us, as legislators, to remove the barriers to negotiation so as to ensure the most vulnerable are not forced to suffer. The best way to achieve that is face-to-face negotiations. The position of the HSE is that the Competition Act prevents it from negotiating directly with the IPU. The amendment we are putting forward removes any such problems under the Act. I recommend this Bill to the House and urge Government Deputies to back it in a public display of their support for a negotiated settlement which will benefit patients, pharmacists and the HSE.
I noted with interest the contribution of the Minister for State, Deputy Michael Ahern, to this debate last night. Not once did he mention the word "pharmacist" or even acknowledge the problem that exists for the IPU. He stated: "the Bill before us today is, in effect, championing price fixing, which is a serious crime carrying a maximum prison sentence of five years". This gives rise to the question of whether the Minister of State has decided by implication that the general medical scheme as it stands is administered by pharmacists in a manner that is not in keeping with the law. He must clarify his opinion.
The current impasse between the IPU and the HSE is characterised by the latter seeking to enforce its will on the former without even the courtesy or corporate social responsibility of allowing negotiations. The very nature of this unilateral decision to slash the payments made by the HSE to pharmacists for the purchase of medicines will undermine the viability of pharmacies everywhere.
I do not speak for the large multiples which will soak up the reductions in margins without pain but for community based and family run pharmacies which have a wealth of knowledge of their clients and are acutely aware of the intergenerational health issues that run within families. The vast majority of these pharmacies are located in rural and marginal areas. In my constituency of Cork East, towns such as Mallow, Fermoy, Mitchelstown, Youghal, Carrigtwohill, Cobh and Midleton are characterised by the presence of independently owned pharmacists who rely heavily on the general medical scheme. I speak for those who may have taken over a pharmacy from a parent and are carrying on a proud tradition. They deserve the opportunity to at least negotiate their position.
This move by the HSE is dolled up as reform but we can see it for the bullying tactic it is.
Hear, hear.
If the HSE had the reforming zeal it purports to have, it would have consulted the pharmacists prior to any unilateral move. That is why we are seeking to ensure that by amending the Competition Act, organisations such as the IPU will at least have the right to negotiate a position that will not leave them stranded on this or any other issue.
If the concepts of engagement and social partnership are to mean anything, the Government will at least afford them that right. This unilateral action by the Health Service Executive, HSE, runs contrary to long-held beliefs that the primacy of negotiation with any representative body is paramount. The Labour Party seeks to defend that right.
I thank my Labour Party colleague, Deputy Michael D. Higgins, for introducing this Bill and I commend him on the extensive work that went into its preparation and the detail it contains. Hopefully, through the acceptance of this Bill today, Members will move beyond the impasse that exists between the HSE and the Irish Pharmaceutical Union, IPU. I intend to refer to three issues today, namely, the management by the Government of the matter, the ethos of community-based medical services and the basic premise of fair play.
I will begin by posing the most obvious question that people in the Gallery must be asking, namely, why Members are debating this Bill today. To an increasing extent, rather than taking up the reins of power as it was elected this summer to do, the Government has become crisis driven. Since the return of the Dáil last June, crises have arisen in respect of water charges, provisional driving licences, Shannon Airport and cancer services. Members now face another crisis because the Government's position has meant that it has failed to manage. Although it was the Government's responsibility to bring a solution to this House, it has failed to so do. The HSE is hiding behind the Competition Act 2002 and, in turn, the Government is hiding behind the HSE on this matter.
This issue also raises questions regarding the Government's current ideological position in this regard. Does the Minister simply believe in competition for its own sake? If this is the case, community-based service providers that provide a necessary health service will be driven from the market. Massive wholesalers that will be able to operate within the profit margins that will exist under the new contract will move in. The idea of an elderly person with a prescription going to a local pharmacist will become a thing of the past, as have local grocery stores to an increasing extent.
Last night, my Labour Party colleague, Deputy Joe Costello, referred to the concept of fair play and fundamentally this is what the Bill comes down to. The manufacture of pharmaceutical drugs involves manufacturers, wholesalers, retailers, patients and the HSE. The HSE has dealt with the manufacturers and the wholesalers collectively and the IPU deserves the same treatment. Had the Government been proactive in this regard, it would have negotiated with all the parties at the outset and the current position would have been avoided. The sector is moving from one crisis to another and the HSE has spoken of imposing another deadline in February. Matters are continuing without any direction coming from the Government to the IPU or in particular to elderly patients who wonder from where their next prescription will be attained.
When Professor Drumm held a meeting with Members one month ago, he stated that the Competition Act 2002 contains anomalies. If such anomalies exist, it is the Government's job to rectify them. The Labour Party is doing the Government's job for it by introducing a Bill. Should the Government finds flaws in the Bill, it should table amendments to correct them. The Labour Members will discuss them with the Government and will offer any support it seeks to amend the Bill. However, if I may use a pun, washing its hands of the Bill without having a prescription itself for the problem is a completely inexcusable position for a Government to adopt.
Through this Private Members' Bill, Labour Party Members hope to clear up the existing anomalies that separate the HSE and the pharmacists. I urge the Minister of State and the Government to follow suit. The IPU's position is clear. It does not want the Bill to set out prices but seeks an opportunity to begin discussions on this matter to bring them to a successful resolution. It is on record as so doing and all Members have received correspondence from Mr. Michael Guckian on this issue. It is a matter of public record that the IPU has adopted this position.
Furthermore, all Members have received correspondence from pharmacies located in their own constituencies. I assure the Minister of State that the pharmacists have read through the Bill and probably are more au fait with its contents than are the Government Members who spoke on it today. The latter have, at best, cherry-picked what they perceive to be its weaknesses. I reiterate the point that it is unacceptable and inexcusable that when a solution is proposed for an issue that has been before the House for such a long time, the Government simply washes its hands of it and states that it will consider it some time in the new year. This position is unacceptable. It is unacceptable for anyone who has a prescription or who requires pharmaceutical services on a regular basis to be left in a state of limbo because of Government inaction.
I ask the Government to revisit its position, accept the Bill, work through its weaknesses, if such exist, and bring the matter forward. The idea of Government Members leaving the Chamber today on the conclusion of Dáil business for a recess that will last until January and then returning having done nothing in the intervening period is completely inexcusable.
I have listened with great interest to the opposition to this Bill, which in this case comes from the Government. I have only heard about the Bill's weaknesses and how it would encourage price fixing. As other speakers have noted, price fixing exists at present and it was done at the Government's behest. This is how the Government does business. It determines the rate of increase for people who work in other areas and negotiates with the IPU, as it always has done, to determine the compensation pharmacies will receive in lieu of the service they provide to communities and patients. One must ask a fundamental question. As matters stand, Members are considering legislation that could resolve this impasse and the Government is saying "No" by refusing to accept this legislation.
If the Government is determined not to negotiate with the IPU, how does it imagine that people will have their prescriptions filled? Does it expect people to revert to the old dispensary system? Does it expect the old and the sick to queue up in cold, damp hovels to be dispensed their medication through an awful hatch in the wall and to be treated as they were in the past? Is this the Government's intention? Ireland has moved away from such practices. We have moved away from having designated doctors in Ireland. Both private and public patients now sit in the doctor's surgery and no one can tell the difference. It is exactly the same in pharmacies and no one can tell the difference.
The Government is determined that this system of equality, which has come about through long years of negotiation, will come to an end. The Government is determined that pharmacies will be located only in areas of high population. Small towns in County Cork, of which Members are aware, will no longer have local pharmacies because they will not be able to survive. I note the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Billy Kelleher, is in the Chamber. He represents a Cork city constituency, part of which is fairly rural.
It extends to Blackpool.
Will the Minister of State tell his constituents that, henceforth, they will be obliged to travel into the city to have a prescription filled? That will be the consequence of his actions and I urge the Minister of State to accept this Bill.
It is accepted in the House that the Bill is well meaning but its full consequences need to be examined in much greater detail, as has been said by other speakers.
Reference was made to the Competition Authority in the context of the Competition Act 2002. The authority is completely independent and was set up statutorily in 2002. The Act was the culmination of a root and branch review of all aspects of competition law in the State undertaken by the Competition and Mergers Review Group. The group comprised social partners, economists, lawyers and people with expertise in the area and it reported in 2000. The Act was a follow-up to it.
This Bill must be put in the context of the current position on competition. Deputies from the Labour Party referred to the Irish Pharmaceutical Union and the HSE but should realise this matter has broader ramifications. The existing legislation was put in place primarily to protect consumers, to ensure the existence of open competition and to ensure an organisation would have teeth to investigate cartels and price fixing. It would be disingenuous of the Labour Party to suggest we should row back on this and should have an organisation without teeth that is incapable of investigating records to determine whether price fixing is taking place or whether cartels are operating. Fundamentally, the Competition Authority acts in the best interest of consumers and any diminution of its activity would undermine its credibility. It would really undermine its independence to ask for such a diminution and for the Government to have a say in the offices it can inspect.
Let me refer to speeches on the trade union movement made last night. We all understand the impact the Bill would have in this regard. According to the explanatory memorandum, if the Competition Act 2002 applied with full force and effect to trade unions and their members, trade unions would then revert to their old common law status as unlawful "combinations" and trade union leaders would be prosecuted as parties to a criminal conspiracy. The 2002 Act applies only to undertakings and associations of undertakings. For the greater part, trade union members are employees, not undertakings, and in the view of the Competition Authority, trade unions representing employees would never, when acting in that capacity, be considered as associations of undertakings. It is important that the Opposition's views in this regard not be let hang in the air uncorrected.
The State is supportive of the trade union movement and its role in society. Through the national partnership process, it played a dynamic role in paving the way for national prosperity in modernising our economy and accommodating change in creating a healthy climate for industrial relations. Through its participation on boards and many State bodies, it has contributed significantly, both in representing and vindicating the rights of its members and helping to shape our strong performance and rapid development. A difficulty arises, however, when a trade association acts on behalf of self-employed contractors. By engaging in fee negotiations for services provided, the trade association is, under competition law, engaging in price fixing. We can talk about the specifics of the Irish Pharmaceutical Union and the HSE but this Bill has broader ramifications.
Let me refer to the findings of the European Court of Justice on the Viking Line case referred to by Deputy Michael Higgins. It is complex in its balancing of the rights of freedom of establishment under the treaty against the rights of trade unions to take collective action in defence of workers' interests. This will require much more detailed analysis. All of these matters can be analysed in the context of the review of the Competition Act and all interested parties have been invited by way of public advertisements to participate. I am sure the debate last night and today will be taken into account.
A report was issued on the Laval case yesterday and could have ramifications. The detail of this will have to be analysed also.
I referred to both cases.
However, we have a minimum wage in Ireland. There is none is Sweden and we must acknowledge this.
I sometimes feel I live in a different area to some of the Deputies opposite. We have very robust and strong legislation to protect employees and ensure their rights are vindicated. The Employment Appeals Tribunal, Irish Human Rights Commission and Labour Relations Commission are instrumental in this regard. There is a vast corpus of employment rights legislation to protect workers. To suggest this side of the House is not caring in this regard is incorrect because we have been very proactive in ensuring the establishment of the National Employment Rights Authority. I hope 90 labour inspectors will be recruited by the end of the year. These measures were all included in Towards 2016 on foot of strong commitments made in negotiations with the social partners.
We will be opposing the Bill. A review body has been set up and all the Members who have contributed today can make submissions thereto. The deadline is at the end of this year. I am quite sure the review will be successful. If there are anomalies in the legislation, we can then deal with them. We will deal with them in a structured manner rather than by way of the Labour Party's knee-jerk reaction.
I wish to share time with Deputy Michael Higgins, whom I compliment on working so hard to introduce this Bill.
Is that agreed? Agreed.
There has never been a Bill subject to so much misconception, misdescription, misdiagnosis and, I am reluctant to say, deliberate distortion. I am delighted to have the opportunity to speak on it and I probably have as good a legal view on it as anybody else.
The subject of the Bill first raised its head in respect of Actors Equity and, more recently, the Irish Pharmaceutical Union. It has now arisen in respect of other organisations and it seems to be the accepted wisdom in the HSE and other bodies that the Government can no longer negotiate fees and prices for representative bodies delivering services on behalf of the State. This is ludicrous. The Labour Party believes discussions and negations on fees and prices between representative bodies such as the Irish Pharmaceutical Union, the Irish Medical Organisation, the Irish Dental Association and others should be allowed so the Government can deliver services in an organised and efficient manner that is surely in the public interest. The Minister of State has deliberately omitted to refer to section 3 because it does not suit his purposes. My argument does not in any way imply that we do not believe we should not strive to obtain value for money. We have been arguing with the Government for value for money for a long time and certainly have not achieved it. It must be achieved through partnership with stakeholders.
As the party's spokesperson on enterprise and employment, I would like to address a few issues related to the Competition Act, which I have studied carefully. In this regard, let us consider the market we are talking about. As I understand it, under the medical card scheme, medicines are delivered free of charge to patients, and pharmacists are then reimbursed by the State through the HSE. The prices for the medicines are agreed between producers, distributors of the medicines, pharmacists and the State in negotiations. For people who are not entitled to obtain a medical card, medicines supplied to a value in excess of €90 per month are supplied free of charge to the patient. The pharmacist is again reimbursed by the State through the HSE. Where is the price fixing and who is the price fixer? Why is the Competition Authority not investigating the entity that fixed the price?
The State.
It is the State. Consequently, if we examine the consumer market, it will be clear that there is and can be little price competition between pharmacies, particularly in the case of medical card customers since these customers obtain all their medical requirements at zero cost.
Other services provided by pharmacists, such as advice on health issues, about which we heard in the House, are generally provided free of charge. I can go into Mr. Niall Weir's pharmacy, Mr. Richard Woods' pharmacy, McEvilly's or any pharmacy in Mullingar and the staff will advise me. I have had a few health issues and in this regard they have been very good to me. For the life of me, I cannot understand how services provided by the State, in respect of which prices are fixed the whole way down the supply chain, can come within the terms of section 4 of the Competition Act 2002. Even if they did, the conduct of negotiations in which there is a considerable interest involved, in addition to the individual's right to association and representation, would come within the terms of section 4(5) of the Act.
I would like to review the provisions of section 4(5). It allows conduct that would normally be considered to be anti-competitive where certain conditions are met. It must be established that the anti-competitive conduct satisfies the following conditions: contributes to improving the production or distribution of goods or provision of services or to promoting technical or economic progress, allows consumers a fair share of the resulting benefit, does not impose on the undertakings concerned terms which are not indispensable to the attainment of these objectives and does not afford undertakings the possibility of eliminating competition in respect of a substantial part of the products or services in question.
The objective of the State is to provide medicines to people who cannot afford to pay for them. The Act states: "contributes to improving the distribution of goods or services relative to what would be the case in the absence of the arrangement". It does not take a genius to come to the conclusion that if these medicines are not supplied and the Government does not pay for them, people will not be able to afford to pay for them.
There is no price fixing.
In the terms of what constitutes a fair share of the resultant benefit under section 4(5)(ii) of the Act, it seems there is a significant gain in consumer welfare among all qualifying households. They get timely and ready access to medication and it is free for medical card patients, or else it is subsidised by the Government under the drugs refund scheme. The ultimate benefit to the consumer across the country is very clear.
Section 4(5)(iii) states that the only terms imposed on the undertakings in the case of pharmacy services is to supply the medicines free of charge, or in the case of the drugs refund scheme, free of charge over the €90 threshold and the keeping of relevant accounts. According to section 4(5)(iv) of the Competition Act, only pharmacists can supply medicines covered by these schemes. I again cannot see how the current arrangement between pharmacists and the State can afford to an undertaking the possibility of eliminating competition in respect of a substantial part of the products or services in question. There is no price competition in methadone or in the medicines schemes because the price is agreed with the State. There might well have been an issue when we had a limitation on the number of pharmacies, but as we have now the most liberal pharmacy market in Europe, the current negotiation arrangements must surely comply with this section of the Act. In passing the Competition Act of 2002, it was never envisaged that the Act would prevent negotiations with representative bodies for members who supply services on behalf of the Government to citizens of this country.
I question the handling of this whole situation by the HSE, which is indicative of its handling of many other issues. What is going on between the HSE and the Competition Authority? Was it divine intervention that prompted the Competition Authority to raid the offices of the Irish Pharmaceutical Union? Who prompted it? Who asked the Competition Authority to get involved? Why would the Competition Authority want to interfere in markets when, as I have explained clearly, the potential for price competition is limited? Is it helpful to have the authority involved in what is a sensitive, volatile and difficult industrial relations issue? I ask the Minister to ensure that there is no collusion between State institutions in trying to force their will on any law-abiding individual or organisation. Surely we have an obligation to all our citizens to protect their rights of association, representation and fair procedures.
In concluding this debate, I express my thanks to the 17 Deputies who spoke. The Bill is important and is certainly not a knee-jerk reaction. After all, it is just over two years since I wrote to the Taoiseach asking him to do something, in November 2005. Yesterday evening I outlined details of his letter to me in which he suggested that he agreed that ICTU was concerned. A previous version of this Bill existed and I received communication from the social partners asking me to withdraw my Bill so that the issue could be solved in the partnership talks. I deeply regret that that did not happen and that the Bill is not being allowed to proceed to Committee Stage, where all those who wanted to amend it would have the opportunity to make a contribution.
In the short time available to me, I would like to clarify a number of points. When I came into this House for the first time 20 years ago, I was told that when interpreting a Bill, it is important to interpret the entire Bill. One particular section cannot be taken and used out of context. This is advice that some of the younger Deputies should follow and they should avail of the courses on the interpretation of legislation that are provided by the commission. For example, section 2 of my Bill is qualified by section 3(2), which states: "Where the Government makes a declaration under this subsection that there is, in relation to a scheme to which this section applies, a public interest in negotiating a collective agreement between the public body concerned and an organisation that is representative of the profession concerned, providing for the terms ....." Therefore, there is a choice. I could have tried to strike down section 4, but I did not because I was not striking against competition.
The Minister of State, Deputy Michael Ahern, in a rather strange speech of 17 pages, devoted 14 pages to what one might call a hymn of praise to the Competition Authority and three and half pages to the Bill. He happened to get it wrong and I would like to clarify some points in law that are straightforward and clear. Article 81 and Article 82 of the EU Treaty only apply to transnational commerce. They do not apply directly into the State. They are translated into domestic law by the different member states. In the case involving Actors Equity, as part of SIPTU, and the Competition Authority, the latter clearly invoked a section of the domestic legislation. There is no point in sowing what is a dishonest confusion into the argument in that respect.
There may be many people who worry about bricklayers and stonecutters getting organised and referring to ancient guilds that might be established, as we heard last night. BATU is in existence and it has 9,000 members. It is in the building industry and it organises brick and stone layers, carpenters and joiners, as well as wood-cutting machinists. They enjoy a registered employment agreement so the Government is wasting its time if it wants to wish itself back to the 18th century, or if it wants to start advocating that little children should be climbing chimneys. Unions have every right to work against the process of casualisation. I believe that right is on the side of their argument. Reference was also made to farm workers. My party was founded in 1912 and we organised rural workers and there is a joint labour agreement that governs minimum rates.
In making his speech last night, the Fine Gael spokesperson said that there is a legal flaw in the Bill because it only amends the Competition Act 2002 and does not either the EU Treaty or the relevant EU regulations. That would be a nonsense because that is not what the Bill sets out to do. It sought to amend the Bill that gives compliance with the EU regulation and with the EU Treaty. He suggested that the Bill would be of no benefit to groups such as Actors Equity, as the Competition Authority's rule is now based on Article 81 of the EU Treaty and not the Competition Act 2002. This is completely wrong.
It was EC Council Regulation 1 of 2003.
Shut up and listen.
Deputy Michael D. Higgins, without interruption.
I repeat that this is completely wrong. The Competition Authority's decision of 2004 and the agreement between Actors Equity, SIPTU and the Institute of Advertising Practitioners in Ireland was based fairly and squarely on the application of the Competition Act and domestic Irish competition law. That is what the Bill was trying to change. In particular, the issue at stake is the concept of an undertaking, something that has not been resolved by the Government or by the social partners. This is defined in section 3(1) of the Competition Act 2002 as a "person being an individual, a body corporate or an unincorporated body of persons engaged for gain in the production, supply or distribution of goods or the provision of a service". It is true that section 4(1) of the Act is based on Article 81(1) of the Treaty of Rome. In applying section 4(1), the authority looks to its interpretation in the Irish courts and by the European Commission in the Community courts.
It was a great pity that the Minister's advisers did not find it possible to refer to the Viking Line case or to the more recent decisions of the European Court of Justice. The decision in the Viking Line case asserted that the right to collective representation is a fundamental right, that it will therefore flow into the treaty and that it takes precedence over laws on transnational commerce. It is a most important ruling. I would have been happy, if this Bill had been accepted on Second Stage, to have had it amended by those who want to improve it. However, there are those in this House to whom I am opposed, who are in favour of casualisation and removing protections from workers.
Deputies
Hear, hear.
They are in favour of applying competition in areas in which it should never have applied. I had hoped that by beginning to address the issue with actors, musicians and freelance journalists, in addressing section 4 as I did, particularly through section 3(2) of my Bill, I would prevent the bullying and outrageous behaviour of the Competition Authority towards different groups. In a thoughtful speech, the Fine Gael spokesperson on health, Deputy Reilly, made the point that the Competition Authority would not help industrial relations by raiding offices. The Competition Authority has nothing to do with industrial relations.
Is Europe assisted by regarding opera singers and actors, who may be unemployed for long periods, who have to live on €4,000 or €5,000 per year as anti-competitive? Should a Minister be proud to say that their union cannot represent them in selling voice-overs and that because they get no maternity or holiday benefit, or any other protection, they should be happy with it? That is a disgrace to everybody who allows it to continue. I will return with this Bill if the Government delays another two and half years.
Deputies
Hear, hear.
Question put.
The Dail divided: Tá, 24; Níl, 68.
Tá
- Broughan, Thomas P.
- Burton, Joan.
- Costello, Joe.
- Ferris, Martin.
- Gilmore, Eamon.
- Higgins, Michael D.
- Howlin, Brendan.
- Lynch, Ciarán.
- Lynch, Kathleen.
- McManus, Liz.
- Morgan, Arthur.
- Ó Caoláin, Caoimhghín.
- Ó Snodaigh, Aengus.
- O’Shea, Brian.
- O’Sullivan, Jan.
- Penrose, Willie.
- Quinn, Ruairí.
- Rabbitte, Pat.
- Sherlock, Seán.
- Shortall, Róisín.
- Stagg, Emmet.
- Tuffy, Joanna.
- Upton, Mary.
- Wall, Jack.
Níl
- Ahern, Dermot.
- Ahern, Michael.
- Ahern, Noel.
- Andrews, Barry.
- Andrews, Chris.
- Ardagh, Seán.
- Aylward, Bobby.
- Behan, Joe.
- Blaney, Niall.
- Brady, Áine.
- Brady, Cyprian.
- Brady, Johnny.
- Byrne, Thomas.
- Calleary, Dara.
- Carey, Pat.
- Collins, Niall.
- Conlon, Margaret.
- Connick, Seán.
- Cowen, Brian.
- Cregan, John.
- Cuffe, Ciarán.
- Cullen, Martin.
- Curran, John.
- Dempsey, Noel.
- Devins, Jimmy.
- Dooley, Timmy.
- Fitzpatrick, Michael.
- Fleming, Seán.
- Gogarty, Paul.
- Grealish, Noel.
- Hanafin, Mary.
- Haughey, Seán.
- Hoctor, Máire.
- Kelleher, Billy.
- Kelly, Peter.
- Kenneally, Brendan.
- Kennedy, Michael.
- Kirk, Seamus.
- Kitt, Michael P.
- Kitt, Tom.
- Lenihan, Brian.
- Lenihan, Conor.
- Lowry, Michael.
- McEllistrim, Thomas.
- McGrath, Finian.
- McGrath, Mattie.
- McGrath, Michael.
- McGuinness, John.
- Mansergh, Martin.
- Martin, Micheál.
- Moloney, John.
- Moynihan, Michael.
- Nolan, M.J.
- Ó Cuív, Éamon.
- O’Brien, Darragh.
- O’Dea, Willie.
- O’Flynn, Noel.
- O’Hanlon, Rory.
- O’Keeffe, Edward.
- O’Sullivan, Christy.
- Roche, Dick.
- Ryan, Eamon.
- Sargent, Trevor.
- Scanlon, Eamon.
- Smith, Brendan.
- Treacy, Noel.
- White, Mary Alexandra.
- Woods, Michael.
Tellers: Tá, Deputies Emmet Stagg and Thomas P. Broughan; Níl, Deputies Tom Kitt and John Curran.
Question declared lost.