Léim ar aghaidh chuig an bpríomhábhar
Gnáthamharc

Dáil Éireann díospóireacht -
Thursday, 3 Dec 1998

Vol. 497 No. 7

Other Questions. - Meat Prices.

Michael Ferris

Ceist:

9 Mr. Ferris asked the Tánaiste and Minister for Enterprise, Trade and Employment the conclusions reached from the recent series of meetings between the Minister of State at her Department and the large retail multiples in her efforts to curb excessive retail profit margins on farm produce. [26121/98]

Last month I met representatives of the principal retail multiples to discuss growing concern among consumers at the perceived failure of the retail trade to reduce the price of meat on the shelves to reflect the historically low prices paid to farmers. I made clear the Government's concern and stressed that profiteering at any point in the supply chain, either at retail level or at the processing stage, would be wholly unacceptable to me as Minister of State with responsibility for consumer affairs. I also made it clear that the multiples must move quickly to restore consumer confidence in the value they are getting for meat and demonstrate that prices in the shops reflect the reduction at farm-gate level.

The representatives whom I met pointed out that prices had come down to some extent and some envisaged further reductions. I said that I would be monitoring the situation to see tangible proof that prices were on the way down. I am pleased to note that food prices decreased in October due, inter alia, to falling beef, lamb and pork prices.

It is Government policy to encourage competition and promote greater price awareness among consumers. I have drawn the attention of the Director of Competition Enforcement to a recent debate in this House on the issue of food prices and have asked him to take such action as he considers appropriate. I encourage consumers to be aware of competing prices and make the market work by making informed purchasing choices.

I have conveyed my views on the role of the processing sector to my colleague, the Minister for Agriculture and Food, and I am awaiting a response from him.

Did the Minister of State seek information from the representatives of the retail multiples on how they convey to consumers the profit content? Senator Quinn indicated at the Joint Committee on Enterprise and Small Business that at least one company was prepared to do this. In a recent survey of prices in France, Belgium, the United States, etc., The Sunday Times found significant evidence of massive profiteering on the part of the large British retail multiples. Some of the prices were not much different. Is it the case that the Irish consumer is being ripped off? When the farming organisations protested in Dublin recently about the fall in farm incomes it appeared to me and many others that they had an unanswerable case.

It is up to each of the companies involved to get the message across. They indicated that their margins had not increased, that the price of the less expensive cuts of meat had dropped more than the price of the more expensive cuts, and that processors were not passing on the full reductions. I made the point forcefully that the difference in price at farm-gate level and on the shelves presented a problem. They argued, however, that account had to be taken of other costs, including transport costs. When Minister, Deputy Yates referred a complaint about processors to the Competition Authority. I have asked it to examine the role of retailers. If anyone has information they should pass it on to the authority which is independent in the exercise of its functions. The CSO figures point to a reduction in October. I am convinced from my study of this, and I have listened to all the parties, that the fall in prices will continue. That is my hope. It is a huge job for all of us to increase awareness and I will continue my efforts on this issue.

For people watching Teilifís na Gaeilge — boring and dull as we are, because we are the best entertainment on in comparison to rival channels — I ask the Minister what has he done? What has happened as a result of all of this? That was not clear from the Minister of State's answer. I was relieved like the rest of consumers when I read the headline "Kitt Calls in Supermarket Chiefs". What did the Minister do when he called them in?

Is there any recognition that we are in danger of pricing ourselves out of competition, in this city at least, for which I can talk best? Prices are spiralling. It is not just a danger to inflation but to our attractiveness as a location for visitors. This is an extremely expensive place. What is the answer to the farmers' question? They are selling the raw material at a certain price and yet there does not seem to be any serious diminution of the price in butcher shops and supermarkets.

The Minister must forgive me for being facetious — I know it is easier to talk about it than to do something about it. Is there any hope? Is there any real expectation for the consumer that prices will come down?

I did not do any differently to what Deputy Rabbitte did as Minister of State with responsibility for consumer affairs. I recall when he called in various interested parties and I know he had occasion to speak to multiples in his time. As a Minister of State with responsibility for consumer affairs what does one do but represent the interests of the consumer? I put the case, which was evident to me and I am convinced it has not changed, that there was a huge disparity between the farm gate price and the price on the shelves.

Certain issues were raised during those discussions which I referred to my colleague, the Minister for Agriculture and Food, Deputy Walsh. Both of us have responsibility — he on the processor side, which he is looking at. The Competition Authority is also involved and I referred the debate in this House to it. The trend shows a drop in prices. Special offers are put in place by the various retailers, one of which was referred to by Deputy Broughan who recently spoke in committee about what his organisation was doing about this.

The bottom line is competition. We have no control in this area since we abolished statutory price control — we never had any on the price of meat, with the exception of chickens. I must inform the public as best I can. I make no apologies for doing that or for bringing in multiples. I will do so again if necessary. In the meantime, my Department is closely monitoring this, as is the new Director of Consumer Affairs.

Is it possible to get the operational profit figures on a carcass of beef from the multiples to indicate the level of profit? What about the role of Bord Bia in promotion? The distinction of quality in the purchase of beef is also important. The multiples should clearly indicate how much beef has dropped in price and the operating profit on a carcass.

I accept the Deputy's point about quality. I assure him I will use any figures available from the CSO or the Department of Agriculture and Food in the interest of the consumer so they get good value. We do not want the price to go through the floor, from the farmers' point of view.

Written Answers follow Adjournment Debate.

Barr
Roinn