Dáil Éireann díospóireacht -
Wednesday, 16 Apr 2014

Vol. 838 No. 2

Competition and Consumer Protection Bill 2014: Second Stage

Minister for Jobs, Enterprise and Innovation (Deputy Richard Bruton)

I move: "That the Bill be now read a Second Time."

This Bill, which is major reforming legislation, has three main objectives. First, as part of the programme of reform we are implementing across my Department, it will merge the National Consumer Agency, NCA, and the Competition Authority to create a powerful body with real teeth acting to protect and vindicate consumers' rights. New criminal investigation functions are being added to the significant powers that already exist in order to combat serious white collar crime and improve competitiveness and protect consumers.

Second, we are introducing strong regulations and enforcement powers to ensure fairness between suppliers and retailers in the grocery goods sector. There is potentially an inequality between these players that could be abused in a manner that would not be in the interests of jobs, consumers or sustainable safe food. Relationships will continue to be based on commerce and prices will continue to be set by hard negotiations. This is in the interests of consumers.

Third, diversity of content and ownership across the media remains an important part of a healthy democratic society. We are retaining the basic model of current laws, which is based on the principle of avoiding intervention by the Government in media ownership except in specific circumstances following procedures determined by law. This is in keeping with the recommendations of the advisory group established to examine this matter. However, it is important to modernise these laws to reflect international best practice and the latest technological developments. For this reason, we are implementing in full the advisory group's recommendations, with some enhancements, and making important changes to update laws in this area.

I now intend to deal with each of the main elements of the Bill in turn, the first being the amalgamation of the two agencies. Reform of the public service is one of the key commitments in the programme for Government and rationalisation of State agencies is a major part of that commitment. As part of that rationalisation, the Competition Authority and the NCA are being merged into one body, the competition and consumer protection commission. Since both were set up under statute, legislation is required to establish the new commission.

As consumer welfare is at the heart of competition and consumer policy, the merging of the two bodies will ensure improved co-ordination of these two policy areas. The merger of the NCA and the Competition Authority will lead to the establishment of a new body with stronger powers and more resources to deal with competition and consumer issues. The basic aim of consumer and competition policy is competitive markets with better services and lower prices for the consumer. The merger will benefit consumers, bringing together the economic and legal expertise of the Competition Authority and the practical knowledge and experience of the NCA into an effective integrated organisation. It will lead to efficiencies and synergies in carrying out the functions of the new body due to the existence of a stronger and more co-ordinated body dealing with consumer and competition issues.

An effective mechanism for overseeing competition and consumer empowerment in the marketplace is the best way to ensure that there are no barriers to entry and that jobs growth and innovation are promoted. This legislation will promote competition and consumer standards, long-term competitiveness and jobs growth.

The Bill sets out, primarily in sections 6 to 45, inclusive, of Part 2, the structure, powers and functions of the new merged body. Many of these sections cover traditional provisions on the establishment of a new body and the dissolution of existing bodies. In terms of structure and corporate governance, the new merged body will comprise a chairperson and between two and six members who will act in a collegiate manner. This structure is modelled on that of the Competition Authority and, consequently, there will be no board. The initial members of the new merged body will be the members of the Competition Authority and the CEO of the NCA. Appointments thereafter can only be made by me as Minister following an open recruitment process undertaken by the Public Appointments Service, PAS.

As is the case with the two existing bodies, the new competition and consumer protection commission will be independent in carrying out of a range of functions, such as enforcement, investigations and merger determinations. The commission will be accountable to the Oireachtas and me as the Minister for Jobs, Enterprise and Innovation in line with usual accountability and governance procedures and practices. Since being announced as part of the rationalisation plan for State agencies, my Department has worked, and is continuing to work, with both bodies to ensure a smooth transition from the two separate entities to a single dual-functioning body responsible for competition and consumer protection.

Crimes under competition law are often viewed as victimless. Let me be clear - we are all the victims of such crimes. Where the operation of the free market is restricted by collusion or other nefarious practices, the result is that consumers pay more than they should have to, whether it is to heat their homes or buy cars. The State and people as taxpayers are victims if companies engage in bid-rigging in respect of public procurement contracts for the building of roads, the fitting out of hospitals and schools or any of the services purchased by the State. All of this adversely impacts on national competitiveness and job creation.

One of the purposes of the Bill is to strengthen the enforcement of competition law by adding to the powers that will be available to the new commission. Breach of competition law is a serious white collar crime and, as with all other forms of crime, those who commit crimes must be punished accordingly. A suite of additional enforcement powers was provided to the Competition Authority in 2012 by me under the Competition (Amendment) Act 2012. I also sanctioned additional staff to be allocated to it in order to strengthen competition law enforcement.

Part 7 gives additional powers to the new commission by extending the provisions of the Criminal Justice Act 2011. In addition, some elements of the Criminal Justice Act 2007 have been incorporated into the powers of the new commission. As published, Part 7 also proposes the extension of the provisions of the Communications (Retention of Data) Act 2011 to serious competition law offences. However, the implications of the recent European Court of Justice, ECJ, ruling on the relevant EU directive on data retention and Ireland's Communications (Retention of Data) Act 2011 in general are being examined.

Other substantive changes to the Competition Act 2002 under sections 46 to 68, inclusive, of Part 3 of this Bill mainly revolve around the procedures to be operated by the new commission in respect of merger notifications. Many of these emanated from a public consultation process held in 2007 and 2008. I also intend tabling amendments on Committee or Report Stage, including some relating to the merger regime, based on the practical experience gained on the operations of the regime during the 11 years since its inception.

Regarding the Consumer Protection Act 2007, a series of five amendments is being proposed in sections 70 to 75, inclusive, of Part 5 on the basis of experience of that Act. I have previously stated that I intend introducing a further consumer rights Bill in 2015 that will update sales law and build on the experience of the Consumer Protection Act.

I will turn to the Bill's second main element, that being, the regulation of certain practices in the grocery sector via the enabling provisions in Part 6. At the outset, let me be clear that the Government is strongly of the view that it is important to ensure a balance in the relationship between the various players in the grocery goods sector and that Ireland continues to have robust agrifood and retail sectors, particularly given the importance of these sectors to the national economy. Regulation of certain practices in the grocery goods sector is intended to achieve such a balance, taking into account the interests of all stakeholders, including the consumer, and the need to ensure that there is no impediment to the passing on of lower prices to consumers. This balance is an important issue.

The need to regulate certain practices in the grocery sector has been asserted by many Deputies. Under the guidance of Mr. John Travers, an attempt was made to secure a voluntary code of practice. In May 2011, I published the Travers report, the findings of which were that there did not appear to be any likelihood of such a voluntary code being agreed. A draft statutory code of conduct was prepared and formed the basis of a public consultation process. Lack of any likelihood of a voluntary code was also recognised by the commitment in the programme for Government to regulate certain practices in the grocery goods sector. At the time of the publication of the Travers report, I recognised that regulation of grocery goods was highly contentious and that there was an inevitable strain in the relationships between suppliers and retailers. However, these relationships should be built on solid principles of mutual opportunity and fair competition, which does not always happen. I also stated at the time that I was disappointed that there had been no agreement on a voluntary code, as regulation by the Government should always be a last resort. Where regulation is contemplated, it should be forensically designed to avoid unnecessary costs on consumers and businesses and to ensure a fair balance is achieved between them.

As the House is aware, the Oireachtas has examined this issue a number of times.

The Oireachtas Joint Committee on Agriculture, Food and the Marine, under the chairmanship of Deputy Andrew Doyle, published a detailed report in late 2013 on the grocery goods sector and highlighted a range of areas which it believed were affecting the grocery goods sector in Ireland. The Joint Committee on Enterprise, Trade and Innovation also produced a detailed report on the retail sector in early 2011 under the chairmanship of Deputy Willie Penrose.

There have also been developments at EU level on the issue of the relationship between various parts of the food supply chain. In September 2013, a voluntary initiative on principles of good practices in the food supply chain was launched and adopted by certain European associations. However, not all elements of the supply chain signed up to this initiative, mirroring the different views on the value of a voluntary system that emerged in Ireland from the Travers report process. In a parallel exercise, the European Commission published its Green Paper, "Unfair Trading Practices in the Business to Business food and non-food supply chain in Europe", in early 2013 and commenced a public consultation on it to gather the views of market participants on the occurrence of these practices, their possible effects and the most effective remedies, if required. The public consultation process was guided by a range of questions ranging from asking if respondents considered that unfair trading practices were pervasive to whether there was consumer detriment in the presence of such unfair commercial practices. Given the diversity of respondents to the exercise, there was little consensus to any of the questions. The European Commission is considering the results to decide whether it will initiate any proposals in this area.

However, none of this precludes a member state from taking measures it believes may be required. Such complementarity between the EU work and the national work is recognised by the European Commission. Obviously, we will all take an interest in the implementation of the voluntary initiative and the impact of its development over the coming months, but it will not halt implementation of the commitment in the programme for Government to regulate in this area.

To give effect to the programme for Government commitment, the Government will introduce statutory regulation of certain practices. These will take the form of a series of regulations, with associated sanctions, rather than a code of conduct. This is a more powerful tool than a code. To oversee and enforce the regulations, there have been calls for an independent ombudsman. As the House will appreciate, the establishment of a new stand-alone State body to oversee this issue would not be feasible in the current economic climate for reasons of scarce financial resources, duplication with enforcement of existing legislation in the Competition (Amendment) Act 2006 on activities that prevent, restrict or distort competition in the grocery goods sector, and the need to ensure there is no unnecessary proliferation of public service bodies. Hence, as has been noted in previous comments on this matter in the Oireachtas, the new amalgamated competition and consumer protection commission will be the independent body assigned responsibility for overseeing and enforcing these regulations.

This new body will be given the powers to enforce the regulations and will build on the considerable enforcement and investigative powers the two current bodies have built up over recent years, rather than start afresh with a new body. Contravention of the regulations will be an offence, as will failure to comply with any contravention notice issued by the new competition and consumer protection commission. That body will also have the power to list publicly all undertakings that either have contravened the regulations or failed to comply with the contravention notices. This will inform consumers on which undertakings are not abiding by the regulations. The commission will also be able to act on its own initiative or on the basis of information supplied to it. However, in enforcing any regulations, the basic tenets of fair procedure and natural and constitutional justice must be upheld. Of course, if there are no suspect practices being carried out, there will be no issue for any contracting party to such relationships.

It is important to note that the introduction of regulations does not, and cannot, guarantee anything regarding the prices received by any given link in the supply chain. Negotiations on price will remain an issue between the contracting parties, as happens in any commercial relationship. What the new regulations will be intended to achieve is to regulate certain practices, not set prices.

These provisions are enabling provisions and set out the issues that will be covered by any subsequent statutory instrument, SI. Part 6 of the Bill, which covers sections 76 to 78, inclusive, sets out a long list of issues and activities which may be covered by such regulations. I intend that this implementing statutory instrument will be brought into force as soon as practicable after the Bill has been enacted, and I will consult with my colleague, the Minister for Agriculture, Food and the Marine, Deputy Simon Coveney, in drafting the regulations. This work will take place in parallel with the Oireachtas consideration of the Bill. The statutory instrument will be accompanied by a detailed regulatory impact analysis. The use of a statutory instrument rather than amendments to primary legislation allows for a more rapid response to changing conditions into the future.

With regard to some issues not covered by the proposal, I refer in particular to the disclosure of margins by retailers. The contents of the financial statements of companies are governed by relevant EU company law directives and regulations and by the applicable accounting standards. I understand the European Commission has no plans to amend this disclosure regime in respect of specific sectors in the economy as this would be open to accusations of discrimination and, were it to be required generally in the economy, it could have implications in terms of business costs and attracting foreign direct investment.

On section 69 in Part 4 and the issue of media mergers, under the current system, if the Competition Authority determines that a media merger fails the competition test, the matter is closed and the issue does not go to me, as Minister for Jobs, Enterprise and Innovation, for a determination regarding the public interest aspect of the merger. If the authority determines the merger can be put into effect, I, as Minister, may direct the authority to carry out a full investigation based on the notification and analysis from the Competition Authority of its decision and the details of the merger as presented. As part of this process, the authority is required to give an opinion as to how the application of the relevant public interest criteria - the strength and competitiveness of media businesses indigenous to the State, the extent to which ownership or control of media businesses and control of particular types of media business in the State is spread among individuals and other undertakings which are listed in the existing statute - should affect the exercise of my powers. If I do not make a decision counter to the original Competition Authority determination, no more action is required. However, if I make a decision counter to the original Competition Authority determination, this decision must be confirmed by me through the making of an order which must be laid before the Houses of the Oireachtas. That is the existing procedure.

This Part of the Competition and Consumer Protection Bill 2014 will implement the recommendations from the advisory group on media mergers which published a report, the Sreenan report, during the lifetime of the previous Government. These recommendations are aimed at modernising the system for regulating media mergers to reflect international best practice and in line with the latest technological developments. However, the broad three-step process that currently exists in respect of media mergers will continue in existence in future: first, a determination by the Competition Authority, or the competition and consumer protection commission in the future, that a merger has taken place; second, a decision by the Competition Authority, or the competition and consumer protection commission in the future, on whether the merger should or should not be permitted to go ahead on competition grounds; third, in the event that the Competition Authority, or the competition and consumer protection commission in the future, lets the merger go ahead on competition grounds, a decision by the relevant Minister on whether the merger should be permitted to go ahead on the grounds of public interest.

There is no provision for, and the Sreenan report did not recommend, an ongoing regulatory function in respect of media ownership. The power only falls to be exercised in the event that a merger takes place, as defined, and that a merger is permitted to proceed on competition grounds. The key concept relating to the definition of a merger remains the concept of effective control. No changes are recommended or provided for in this respect.

Section 69 includes a comprehensive suite of proposals to implement in full the recommendations of the Sreenan report, with two amendments. The first sees a change in the relevant Minister for such public interest considerations from the Minister for Jobs, Enterprise and Innovation to the Minister for Communications, Energy and Natural Resources, with a major role for the Broadcasting Authority of Ireland in drawing up a report for the Minister prior to his making a decision on the matter from a public interest aspect. The Sreenan report noted that both Ministers could be the relevant Minister for the purposes of this test, but it came down on the side of the Minister for Jobs, Enterprise and Innovation as the Competition Authority, an agency reporting to that Minister, would be responsible for the competition test of the proposed merger.

However, given progress in the areas of media, broadcasting and the digital area, it is more appropriate that the responsibility be transferred to the Minister for Communications, Energy and Natural Resources.

The second change relates to designating the relevant joint Oireachtas committee as a notifiable body when the Minister for Communications, Energy and Natural Resources is considering any proposed media mergers from the public interest aspect. The Government believes that the opinion of the relevant joint Oireachtas committee is a very important element of the consultative process that would be undertaken. The Sreenan report did not foresee a specific role for the Oireachtas, but the Government believes that this should be included by way of a notifiable body in the consultation process. This will complement the views of a specific advisory panel which will be established to assist in the examination of any given media merger.

The proposed Bill sees the new amalgamated competition and consumer protection commission's role strictly limited to examining the media merger from a competition angle only. The public interest test and final decision rests with the Minister for Communications, Energy and Natural Resources. The new amalgamated competition and consumer protection commission will have no role in this aspect, unlike the current situation where the Competition Authority must give an opinion in the matter. This clear division of responsibility is one of the cornerstones of the Sreenan report's recommendations. It also includes a wider set of definitions, a longer list of relevant criteria to be taken into account and sets out a formal consultation process that should be followed in making a determination in the public interest.

I firmly believe that the effective mechanism for overseeing competition and consumer empowerment in the marketplace, which is one of the main aims of the Competition and Consumer Protection Bill 2014, is the best way to ensure there are no barriers to entry and that jobs growth and innovation are promoted. This will promote competition and consumer standards, long-term competitiveness and jobs growth. I look forward to working with Deputies on Committee and Report Stages of this Bill. In the meantime, I commend the Bill to the House.

Deputy Sean Fleming

I am pleased to speak on the Competition and Consumer Protection Bill 2014, which is before us at long last. I have listened to the Minister's speech. While there might be some interesting and helpful aspects in the Bill, his script spells out a number of items that are not included in the legislation, but which should be included. What we see in front of us is a weakening of people's consumer rights by the introduction of this Bill. It covers a number of areas that should be in the Bill that the Minister has concluded should not be in the Bill. The Minister stated that under the Bill the new competition and consumer protection commission's role will be strictly limited to examining the media merger from a competition angle only. The public interest test will be solely for the Minister, Deputy Rabbitte.

The new amalgamated competition and consumer protection commission will have no role in deciding in that aspect, unlike the current situation where the Competition Authority has to give an opinion on the matter. A new organisation is being set up, but the Minister is nobbling it at the ankles before he sets it up. The Competition Authority currently has power and authority, can act in the public interest and give an opinion on mergers in the media. This new Bill specifically takes power from the Competition Authority that it already has. People might not like the Competition Authority because it has this power, and they have got to this Government. They have said to this Government-----

Deputy Richard Bruton

On a point of information, this was a recommendation from a committee that reported to the Deputy's own Government at the time.

Deputy Sean Fleming

Exactly, but this Government is implementing it.

Deputy Richard Bruton

Yes. It is not that this will not be overseen; it will be overseen by another body that is better equipped to look at public interest issues.

Acting Chairman (Deputy Bernard J. Durkan)

Thank you, Minister.

Deputy Sean Fleming

I understand the point the Minister is making, but essentially we are giving the sole discretion to the Minister and we are taking away the power that the Competition Authority had. I accept what the Minister is saying, but even if we look at the role of Sky in our national sports in the last few weeks, there are many new cases which were not around when these committees made observations in the past. Media mergers, concentration of ownership and media power have increased enormously, as has the overall influence of media magnates on Irish society. Not only do they own media, communications and mobile phone networks, they are now also involved in hospitals so there must be some limit to monopolies and how much individuals can actually control in Ireland. The situation has been exacerbated in recent times, but this Bill is going in the opposite direction.

Another element of the Minister's speech that I oppose is in respect of the role of an ombudsman. One of my first questions would have been whether this Bill will be subject to freedom of information, and I do not see that it is. We will need clarification of that on Committee Stage. I believe the Government has given a commitment on this. Time after time, the Minister for Public Expenditure and Reform has stated that all new agencies will come under the freedom of information legislation, so I look forward to this Minister confirming that the Freedom of Information Act will apply to this new agency. It is not clear from this, but perhaps it is covered in some other legislation that will automatically bring it into being. Not only is the freedom of information legislation important, but so is the issue of an ombudsman. The public has lost faith in many institutions both in the public and private sector, but there is strong respect out there for the role of the ombudsman. There is no need for a separate ombudsman, but this organisation should be brought under the remit of the current Ombudsman.

There is an argument that we do not want a stand-alone agency, but it does not have to be a stand-alone agency in the current economic climate. It is claimed that for reasons of scarce financial resources, duplication with the enforcement of existing legislation on activities would not be feasible. I do not buy that. As we are in a time of scarce economic resources and because we have been in a difficult economic situation, it is all the more reason for being careful with how public bodies carry out their functions and deal with matters on behalf of the public. For that very reason, the Ombudsman should have a role and we will be putting down amendments on some of these issues on Committee Stage.

I would also like to highlight one of the fundamental flaws in the Bill that is specific to Ireland. The Minister states that in respect of "some issues not covered by the proposal, I would particularly refer to the disclosure of margins by retailers". The big boys have won again and the consumer loses out. I am talking about the big multinationals. I have heard the current and previous taoisigh refer to items they have had to discuss at Heads of State meetings at EU level. Some of that was about the role and strength of supermarkets across the EU and how they were strangling the producers. This is not just a matter in Ireland; the role of the buying power of key players is an issue in every EU country. Three or four people can determine the livelihood of thousands of producers in Ireland and across the EU. I understand these matters would have been raised at G8 meetings, such is the seriousness of the purchasing power of some of these major multinationals when it comes to setting prices for the producers so they can move on.

The Minister quotes EU company law and accounting standards, and I know that accounting standards require geographic details in respect of turnover, but the Minister does not want to go down the road of a disclosure regime in respect of the margin. I would say that there is a specific case for the island of Ireland when it comes to margins. Survey after survey shows the prices in supermarkets in Dundalk versus the prices of supermarkets in Northern Ireland, and the price of products sold by Boots pharmacies in the North versus the price of products sold by Boots across the country and in Dublin. Time after time we see schedules and lists published in the newspapers which show the different prices between North and South. I will not never accept that it is a different market. The response we get from all these multinationals is that the Northern Ireland market is part of the UK market and they have the economies of scale when selling to a population of 60 million, something that does not apply to a population of 4 million in the Republic of Ireland. Newry and Belfast are closer to Dublin than they are to London or Edinburgh, and I do not accept the argument being put up by these companies that they should not have to disclose their margins. When a company in England sources its products in England and sells into the market of the island of Ireland, it has different margins North and South of the Border.

That is not in the interest of people on this island. This legislation is failing the Irish consumer in addressing the different margins that apply and the purchasing power of the multiples. The Minister acknowledged in his statement that the legislation does not cover the proposal.

The Minister has left more out of the legislation than he has included. The Bill runs to 92 pages and admittedly has some excellent provisions, such as the setting up of a new agency. I have no problem with amalgamating two agencies and creating more efficiency, although the savings will be minimal because everybody has to keep his job, rights and entitlements and there will be contractual leases for buildings and other such arrangements. While there may be more efficiency in the longer term, which I support, the savings do not justify the introduction of the legislation.

The Minister stated there are three elements to the legislation. The first is the amalgamation of two agencies, which is good, although the savings for the public will be very low. Second, the Minister wants to deal with the issues arising between suppliers and retailers in the grocery sector. I have just explained how the Minister funked completely in this regard, and he refused to include sections in the legislation regarding the margins allowed on grocery products north and south of the Border. This has rendered the second part of the legislation very weak.

The third element concerns diversity and ownership across the media. The Minister is saying he will not deal with this either. In fact, he is to reduce the power of the Competition Authority in this regard. The Minister would be better calling this legislation a Bill to establish an agency to reduce the powers and protection of Irish consumers than what he has called it. Two fundamental issues are not being dealt with. The Minister has failed to deal with the media issue and the relationship between suppliers and retailers in the legislation.

I wish to highlight a problem concerning competition in the retail sector. Last Christmas, we all saw the queues outside some of the German supermarkets, such as Lidl and Aldi, where vegetables were offered for 50 cent or 5 cent - I forget the particular offer. Owing to the offers many people were cleaned out. We were all informed at the time that the next target was the meat industry. The supermarkets were to offer much reduced prices for meat and were thereby going to do fundamental damage to local butchers in all the affected towns.

There is a branch of every supermarket chain in my town, Portlaoise, and I check the prices in them all. Meat products in Lidl and Aldi are quite dear. I want that to be known because people believe there is great value there. The two supermarkets have good value on some items. These items are probably loss leaders but we do not know because they are German or from elsewhere in Europe. They are not the traditional products we are used to. The price of 1 kg or 0.5 kg of any meat in Lidl and Aldi is certainly no lower than in any other supermarket. I wish to knock on the head the view that some of the products are good value.

The substantive issue with which we need to deal is below-cost selling. My main complaint about below-cost selling, on which I have a certain view, concerns how major supermarkets can sell alcohol below cost. This issue needs to be dealt with aggressively because teenagers, including 14-year-olds and 15-year-olds, are getting beer for under €1 per can. There was a time when one almost tripped over the pallets of beer when going through the front door of some supermarkets. While I accept that alcohol products are now segregated, this does not stop the drink getting into the hands of young teenagers, perhaps because it is purchased by older friends or family members. The main reason is that the drink is being sold at such a cheap price. There is a case not only for dealing with below-cost selling but also for imposing a new tax on alcohol sold in off-licences at such a low price. Below-cost selling is adding to the binge-drinking culture. Many difficulties in the health service arise from this over time. The serious impact is not being dealt with.

When a supermarket buys containers of drink to sell below cost, it gets a VAT refund from the Government. This is absurd. Not only are supermarkets destroying the young population by making the drink so readily available, they can in turn get a VAT refund because they sell below cost. The matter is very simple. If a supermarket sells a can of beer for €1, it includes VAT, but if €1.20 is paid for the can of beer, including VAT, the purchase cost is higher than the sales cost. Therefore, when the supermarket submits its VAT return on the beer it is selling below cost, it actually gets a VAT refund on the loss. This is morally wrong and should not be allowed to continue. It is doing immense damage. These are the issues with which we should be dealing in regard to competition and below-cost selling when dealing with this legislation.

I have referred to various aspects of the legislation and wanted to highlight matters that the Minister referred to in his opening statement before making my points on the legislation. There are some good points in the legislation but most of the good points that should be in it have been omitted. It is welcome that there is a new criminal investigation function. We need to ensure that the watchdog will have real teeth. We have grave concerns that it will not. When we consider some of the bodies with powers of prosecution, including the Office of the Director of Corporate Enforcement - I do not refer here to the Garda - we realise court cases are very rare. It is important that this matter is being dealt with.

Where anti-competitiveness issues are concerned, the biggest culprit is the State itself. The Government is setting up Irish Water, which I will not discuss in detail. The Government is to set the price of water for every business in the State, and it will probably be different from the current price. Non-commercial consumers will have to pay also. There will be an additional cost on business considering that current rates vary from county to county because they are set at local authority level. Irish Water is to have a turnover of €190 million this year from the commercial customers it has taken on from the local authorities. I assume that if there is one national agency, a litre of water will be the same price in Dublin as in Caherciveen. It would be very absurd if different prices were charged by Irish Water in different counties, as happens at present. Some commercial customers may gain but some will be paying higher rates for water than they have been paying to date. The general public will have water meters installed in their houses as the year progresses and they, too, will have to pay. The Minister is adding to the cost of business. This is one of the difficulties we have with everything the Government is talking about. It wants to talk about competition but it is making sure, through a lack of competition, that it does nothing to bring prices under control.

The questions of legal reform and the medical profession must be taken into account. On the grocery business, while "hello money" was banned many years ago, a new regime in now in place whereby retailers charge suppliers for marketing and promotion. The supermarket tells the supplier it is going to mention his or her product in a television advertisement but that he or she must pay for it. This is anti-competitive. We know well what will happen if the supplier says "No"; he will not be a supplier the following week. Companies and big buyers can abuse their dominant position in Ireland, and we want to see this rooted out.

The Government is one of the significant contributors to high costs, and this distorts competition. If the cost of doing business in Ireland is higher than elsewhere, it makes it much more difficult for our businessmen to compete with those in other countries. Our electricity cost is among the highest in the European Union. There is a hotchpotch approach to waste disposal throughout the country. It is becoming more expensive as the years go by.

In addition, the interest rates charged for small businesses are excessive when compared to many other European countries. The cost of other services, such as postal and transport services, is also increasing and the new carbon tax is another initiative that will add more costs onto Irish businesses and make them less competitive in the international market. The Minister brings forward this competition legislation today yet his Government is making it more difficult for these businesses, which are employing Irish people, to compete abroad.

One area where there is not sufficient competition is that of broadband, where everybody talks about the lack of services. In coming from my constituency today on the main motorway, I twice lost mobile phone calls on my hands-free Bluetooth set because there was not sufficient mobile phone coverage. In my constituency office, my mobile phone signal is not adequate. I do not know what the mobile phone companies have been doing in recent times but I say categorically that the quality of the mobile phone service has deteriorated in certain parts of the country and the broadband service is also at a very low ebb in many areas. There is not sufficient competition in those areas and it would be far better to force those companies to provide a proper service to their customers than to pass this legislation, which leaves out more than it includes.

With regard to competition, I see a major lacuna in the legislation which goes back to the question of why we have the Competition Authority. This reflects a particular right-wing ethos whereby competition in king. Competition is not always king. The idea that we cannot have people negotiating collectively as this would distort competition is a bad thing because that is not necessarily the case. The Government cannot now negotiate properly with the IMO in regard to the contract with GPs because it would be deemed to be in breach of competition legislation. We had the same argument in regard to the pharmacy organisations some time ago, when we were told negotiation would be anti-competitive. I remember this issue coming up in a debate in the past. I am convinced that the EU legislation which states that competition is king also provides, when it comes to the health service, that competition issues can be set aside. We in Ireland have been weak in enforcing that aspect of the legislation.

We have not tackled the issue of competition in the legal profession. There is a cosy relationship between the legal profession and this House. I believe it has been too cosy and that there has been too much influence here. The troika came here for three years and the legal profession prevaricated about the need to reform itself. It was said there was so much other legislation, and that the draftsman's office, the Government and the Attorney General's office would have to be involved, so they never got around to reforming the legal profession. The troika is now gone, three years on. The legal profession won and the people of Ireland lost.

The case I would cite in all of this is that of the State Claims Agency, which currently has on its books claims that the agency maintains will cost some €1.2 billion to settle - these are the figures produced in its annual report. Out of that €1.2 billion, however, approximately €500 million is for legal fees. This is the biggest element in many cases, where the legal fees are greater than the cost of settling the cases. The Minister is presiding over a situation where barristers can, by and large, get €500 million from the State Claims Agency over the next couple of years and there is no real competition.

I am not talking about internal competition among a few buddies dropping €50 an hour, or about the Attorney General setting a rate. Anyone who thinks that is where the debate is at does not understand the issue at all. Legislation has to be enacted that will allow the State Claims Agency to employ its own barristers, and that legislation must allow those barristers who are employees of the State Claims Agency on a fixed annual salary to represent the State Claims Agency in court. I know the legal profession will do a song and a dance and say a barrister is a self-employed person. However, hospital consultants can say the same but they still work for the HSE under contract, and we have dealt with the issue of the indemnity insurance of hospital consultants. All of those issues can be dealt with. A barrister cannot make a greater case that he is a self-employed professional than a consultant operating in a hospital. If we have solved it with the consultants on the medical side by bringing them under contract into the HSE, we must and should do the same with the legal profession when it comes to handling these issues. The tribunals have closed and the legal profession has now moved on. The new gravy train is the State Claims Agency. There is €500 million sitting there to be paid out by the Irish taxpayer on State Claims Agency claims in the coming years.

I want to deal with some aspects of the legislation, although it is unfortunate that some issues that should form part of the legislation have been omitted by the Minister. As I said, the Ombudsman and freedom of information should have a role on this issue. I also want clarification, when the Minister is summing up, on the role of this new competition and consumer protection agency in respect of Irish Water and whether it will look after the interests of the consumer in that regard. I understand the commission will itself be able to initiate prosecutions. I hope it is aggressive when it needs to be in order to do that.

Section 10 deals with the membership of the commission. It states that members will be eligible for reappointment on a temporary basis by a Minister for an aggregate period of not more than 12 months, where vacancies arise. How many times can a person be reappointed? There are generally fixed terms of five years under the new legislation. Can a person have two or three five year terms? The Minister might spell that out.

On section 17, if it comes to prosecutions I agree there needs to be co-operation between other regulators such as the Commission for Aviation Regulation, the communications regulator, the energy regulator and the Health Insurance Authority. While I welcome that, when the legislation is going through the Dáil, the Minister might provide examples of how those arrangements will work and any legal and constitutional barriers that exist in other legislation that would prevent those organisations coming to agreement with this new commission. I have seen this arise before. There are regulations in place to deal with a situation where, for example, the Director of Corporate Enforcement wants to investigate a matter in regard to the banks and he might have information that is relevant to the Revenue Commissioners or the Financial Regulator. While, in some cases, the Director of Corporate Enforcement can pass his information back to the Revenue if he deems it relevant, Revenue is slightly more restricted in what it can pass to the Director of Corporate Enforcement. Arrangements need to be set up in this regard. My question is whether there will be an equal transfer of information or whether it will be substantially a one-sided transfer of information. We are dealing with several other pieces of legislation, for example, in regard to health insurance, and there may not be the exact same provisions in other legislation allowing for this transfer of information.

Section 24 outlines that the commission will report to the Committee of Public Accounts, which, it goes without saying, is a good thing, and everybody supports that. However, I have an issue with section 25, which deals with the accountability of the chairperson to other Oireachtas committees. My concern is that the section states:

The chairperson of the Commission shall not be required to give account before a Committee in relation to—

(a) any matter which is or has been or may at a future time be the subject of proceedings before a court or tribunal in the State...

I fully agree that the chairman of this new commission, if appearing before the relevant Oireachtas committee, should not be required to give information in regard to a matter that may be in the future or is currently the subject of proceedings before a court or a tribunal. However, I have a problem with the suggestion that he or she may not give evidence in regard to a matter that has been before the courts and is completely disposed of. The public might want to know why the chairperson took a particular line in those court proceedings. There might be a question as to the cost of those court proceedings and whether they might have been done in a more efficient manner. To say that matters that have been disposed of in the courts, which are matters of public record and where the costs can probably be established through the Courts Service if it comes to that, cannot even be discussed by the chairman with the relevant Oireachtas committee is to go a little too far in terms of past matters. This should not be in the Bill.

If the commission does not want to be pursued on a line of questioning, it has the right to go to the High Court within 21 days and seek a declaration from that court.

Perhaps that is standard procedure for regulators and bodies like this. I am not sure. I am not a solicitor but I just asked the question and the Minister can give the answer. Is that a normal section of legislation or are we now issuing a new invitation to the High Court to interfere in Oireachtas committee proceedings? Perhaps it is the standard procedure that applies to all such bodies but section 25 invites the commission to go to the High Court within 21 days and states that the High Court shall determine whether or not the person should answer those questions. If the High Court determines that they should not be answered, the committee will not be allowed to follow that. If the High Court determines that they should be answered, the commission must answer those questions. This runs counter to practice relating to a committee where we set up fair procedures. That section is written by officials in the Department and essentially states that the Oireachtas committee must do its job with fair procedures. That section is an indictment of Members of the Oireachtas who are capable of operating lawfully within their own procedures that have been laid down here.

The last section I want to deal with is section 31, subsection (3) of which concerns whistleblowers. There is a fundamental contradiction between this legislation and the whistleblowers legislation being introduced by the Minister for Public Expenditure and Reform. The essential difference is in subsection (3), line 15 where it states that it is essential that an employee making an allegation acts reasonably and in good faith in forming the opinion and in informing the commission. This issue of good faith has been taken out of the whistleblowers legislation because many people have a legitimate gripe and want to complain about something they are sore about. Just because they are sore and may not be lodging their objection in good faith does not mean they do not have a valid objection. The whistleblowers legislation has removed that requirement and states that an objection is valid regardless of why it has been made. The Minister for Jobs, Enterprise and Innovation is now compromising valid objections by including that clause which flagrantly contradicts the whistleblowers legislation being introduced by the Minister for Public Expenditure and Reform.

It is good to discuss this legislation. Unfortunately, the Minister for Jobs, Enterprise and Innovation has left more out of it than he has included. We will discuss it further on Committee Stage.

Deputy Peadar Tóibín

Is rudaí uafásach tábhachtacha iad cúrsaí iomaíochta agus cosaint tomhaltóirí. Ba cheart don Rialtas an chumhacht a chur i lámha na ndaoine mar gheall ar na rudaí seo. This legislation provides for the merger of the National Consumer Agency and the Competition Authority into a single body to be known as the competition and consumer protection commission. These two extremely important agencies are to be distilled into one organisation. The Bill also provides for the regulation of certain practices within the grocery sector and amends the laws on media mergers by implementing the recommendations of the report of the advisory group on media mergers. Again, these are two extremely important areas - the grocery sector, which involves so many jobs in all parts of the supply chain, and the media sector, which is one of the pivotal elements of a functioning democracy.

Section 17 prescribes those organisations that will work with the new body. It does not mention Irish Water. Water charges are probably the biggest consumer issue facing people at this time. Although we in Sinn Féin have raised the matter a number of times with the Minister, he has failed to take our views into consideration. The Government has established a new governance model to manage, fund and deliver services which will be basically carried by the consumer and taxpayer. The new governance structure will include Bord Gáis, Uisce Éireann, the economic regulator and the Department of the Environment, Community and Local Government. However, we are worried that there is a critical omission in the oversight here. Who will represent the interests of the consumer in this so-called water reform process? Can the Minister give us confidence that this legislation will allow consumers to have full recourse to their experience with this new body and structure? Will the provisions and functions of the Consumer Protection Act 2007 now fully follow through to the citizens with respect to Irish Water? In other words, will the interests of consumers be protected in this legislation?

The National Consumer Agency represents the voice of the consumer. It enforces consumer legislation and defends the interests of consumers at the highest levels of the decision-making process. When we raised the need for stronger consumer oversight with the Minister and in particular with the Minister for the Environment, Community and Local Government, it was stated that the Commission for Energy Regulation, CER, which is the independent regulator for Irish Water, has the power to direct Irish Water to prepare a code of practice on any matter that CER considers necessary and appropriate to secure the interests of the customer of Irish Water. CER has the power to direct Irish Water to comply with a code of practice prepared in accordance with the legislation. CER may consult with Irish Water, the public or any other person it considers appropriate. The National Consumer Agency participated in the consultation on the establishment of the water services utility during 2012 and submitted proposals to the Department which will be considered in detail.

That is all fine but the fact remains that CER is a regulator. It is not a consumer watchdog with the real teeth necessary to protect the needs of the consumer in this area. It is also worth noting that the Minister for the Environment, Community and Local Government did not pay much attention to other needs of the consumer with regard to Irish Water such as set-up costs and where those moneys were being spent so how are we meant to have massive confidence in the Minister's approach to oversight of Irish Water? While the competition and consumer protection commission will automatically be under the new FOI legislation, the Minister could exclude it in the future by secondary legislation. Again, this reduces this House's opportunity to oversee that process.

The resourcing of the competition and consumer protection commission is extremely important. Indeed the Minister has lauded the fact that €170,000 will be saved by this new merger. However, the legislation notes that this organisation will be given extra powers to allow it to investigate a series of competition offences. There is a mismatch there to a certain extent. There is a reduction in money and an increase in functionality. While extra staff were given to the Competition Authority to improve enforcement in 2012, it is simply unacceptable for the Minister not to further resource a beefed-up mechanism which will oversee investigations. It is fine to have these powers on paper but unless the Minister puts in place the necessary resources to enforce them, they will not be effective. The alleged problems in the concrete cartel in this State have allegedly had the effect of increasing prices to the consumer and the State. The State is a massive consumer of concrete. The lack of a properly functioning market and competition in this sector has made it very difficult for those businesses that are compliant to be able to function. Without the necessary funds to enforce compliance, non-compliance becomes a competitive advantage. That is a real danger in any society where a compliant business looks at a non-compliant business and then decides it must become like this business if it wants to function in this market.

In any of these reforms, it is important that the Government does not just focus on the bottom line. It is also very important that the Government sets out to achieve regulation and oversight in a manner that improves the full market. Investment in empowerment will bring about greater savings to the State in the long run.

Debate adjourned.