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Proposed Legislation

Dáil Éireann Debate, Wednesday - 12 May 2010

Wednesday, 12 May 2010

Ceisteanna (13, 14)

Michael Noonan

Ceist:

48 Deputy Michael Noonan asked the Minister for Enterprise, Trade and Innovation his plans to merge the National Consumer Agency and Competition Authority; the progress made to date; the target for implementation and the reason for the delay in implementing the policy; and if he will make a statement on the matter. [19288/10]

Amharc ar fhreagra

Joan Burton

Ceist:

80 Deputy Joan Burton asked the Minister for Enterprise, Trade and Innovation when he plans to introduce the promised legislation to provide for the merger of the National Consumer Agency and the Competition Authority; and if he will make a statement on the matter. [19174/10]

Amharc ar fhreagra

Freagraí ó Béal (14 píosaí cainte)

I propose to take Questions Nos. 48 and 80 together.

As both the National Consumer Agency and the Competition Authority were established under statute, it is necessary to give effect to the newly merged body by way of primary legislation. At the time the merger of the two bodies was announced, as part of the rationalisation plan for State agencies during the 2009 Budget Statement, work on a review of the operation and implementation of the 2002 Competition Act was well under way. The various submissions received following a public consultation process were being considered, as was the report and recommendations of the advisory group on media mergers.

Rather than give effect to the amalgamation of the National Consumer Agency and the Competition Authority in a stand-alone Bill, to be followed in due course by legislation to amend, reform and update the 2002 Act, it was decided to introduce a single comprehensive Bill that will create the new consumer and competition body, update existing competition law, strengthen the public interest test in respect of media mergers in line with the report of the advisory group on media mergers, make some minor amendments to the consumer protection legislation and give effect to the Government commitment under Towards 2016 regarding the exemption of certain specified categories of vulnerable workers from competition law. While work on the draft legislation on this basis has been progressing, developments in other areas have arisen which have led to additional requirements in the Bill.

The renewed programme for Government contains a specific commitment to "implement a code of practice for doing business in the grocery goods sector to develop a fair trading relationship between retailers and their suppliers" and "to review progress of the code and if necessary to put in place a mandatory code". An enabling provision for this code will be provided for in the legislation. This all-encompassing approach has to some extent delayed the legislation for the rationalisation of the two bodies. However, we will be better served in the long run by a single legislative measure that both establishes the new body and provides for a combined and updated consumer and competition code with appropriate enforcement provisions being given to the new body. Work on the draft heads of the Bill is now at an advanced stage and I intend to bring these draft heads to Cabinet within the coming weeks. I hope to publish the Bill in the autumn.

I apologise for neglecting to congratulate the Minister, Deputy Batt O'Keeffe, on the occasion of his first Question Time, on his appointment to the Department of Enterprise, Trade and Innovation. I wish him the very best in his new role. However, there is one aspect of his appointment that has not been clarified for reasons unknown. The Minister did a reasonably good job as Minister for Education and Science, particularly in terms of how he dealt with difficult decisions in regard to cutbacks, including reductions in class sizes. It is still not clear to me why he and the Tánaiste have switched roles. The Minister may wish to comment on that in his reply. We are all very curious about it on this side of the House.

That is a question for the Taoiseach.

Vacancies occurred in other Departments due to illness and resignation, but we have no idea why the Minister, Deputy Batt O'Keeffe, and the Tánaiste switched Departments. It would be interesting to know the reason.

I thank the Minister for his reply to these questions. Can he offer an assurance that the new legislation will not be used to weaken the Competition Authority in any way? One of the strengths of that body is that it has an executive board made up of experts in their field who tend to act like regulators, in the mould of ComReg or the Commission for Electricity Regulation, rather than taking the more passive approach of the traditional State agency. It is very different to the National Consumer Agency in that regard. Will the Minister comment on that?

I thank the Deputy for his good wishes. I am sure he will help me along my way. On the question of ministerial appointments, the Deputy will have to put down a question to the Taoiseach. All such decisions are his prerogative.

By merging the two bodies in question we can produce a stronger entity, but there is no point in doing so unless the new body has teeth and the ability to implement its remit. I am willing to listen to the Opposition in terms of any amendments it puts forward during the debate on the legislation. It is in all our interests to have an effective code and a body with powers to ensure businesses act within the law and that restrictive practices are removed.

I wished the Minister well last Thursday when he introduced the Competition (Amendment) Bill 2010 in the House. He made a good start by indicating his receptiveness to Opposition amendments. Ministers who close their minds generally end up with the smile on the other side of their face because we chase them up.

Will this merger generate any savings? There is a significant degree of overlap across many agencies in all sectors. Deputy Varadkar has been on the case on this issue for some time and is broadly correct in the points he has made. The Competition Authority does important work in dealing with cartels and so on. However, I am concerned at the manner in which it has chased up some issues. We will have nothing but ghost towns if it continues with its current policy where pricing is the only parameter that counts and there is no consideration for value and service.

The Competition Act 2002 has been a source of great problems for people in part-time employment such as artists, freelance journalists and actors, with the bodies that represent them being defined as undertakings. That was never put forward as the desired interpretation during the course of any debate on the legislation in this House. However, it is the interpretation arrived at by the Competition Authority which seems to have carte blanche in this regard. Does the Minister agree that the people to whom I referred are entitled to have collective bargaining rights and negotiating rights attributed to bodies on their behalf? I refer to the Irish Pharmacy Union, Irish Dental Association and Irish Equity, the SIPTU branch representing actors, among others. Surely the time has come to honour the commitment given in Towards 2016 by amending section 4 of the legislation to reflect the will of this House. The Competition Authority must adhere to the provisions of legislation passed by the Oireachtas.

That is a broad expansion of the question.

But that is part of it. It is a fundamental of the Labour Party that we stand for trade union rights, and it is important that those are not taken away at the stroke of a pen. That is what has happened with section 4. I said that in this House 18 months ago and I am still right.

On the question of savings, I advise Deputy Penrose that both bodies are operating at staffing levels below what would have originally been sanctioned. The NCA has 39.4 whole-time equivalents — WTEs — and 80 were sanctioned. The Competition Authority has 43.2 WTEs and 59 were sanctioned.

I anticipate that the staff complement of the new merged body will be less than the posts allocated to the two bodies. That must be considered in the context of the overall control of public sector numbers. I expect there will be savings from shared services in back-office activities such as human resources and finance. The NCA is taking over the functions of the Financial Regulator relating to consumer information and education, and some staff have already been transferred. The two agencies are located in two separate buildings, and the issue of relocating them to one building is being examined.

Deputy Penrose raised the issue of what powers we will give the new body. Regarding direct complaints to the Competition Authority, the forthcoming legislation will not only restate the provisions on anti-competitive conduct in the grocery goods sector in the Competition (Amendment) Act, 2006, but include additional provisions to make it more attractive for people to pursue actions against grocery goods undertaking. That is subject to the advice of the Attorney General. The legislation provides for relief by way of aggravated damages and allows the courts the discretion of limiting the costs of action taken by parties.

Where the court has determined that a particular practice is anti-competitive on the basis of an action taken by the new body, the parties taking private follow-on actions should not also have to prove that the particular action was anti-competitive. I view that as very progressive.

Is the Minister happy that the new authority will be able to control some of the extremely serious situations involving the supermarkets and our large agricultural sector? They insist that money is paid up front for shelf space and so on. The food industry is currently under extraordinary and severe pressure. Farmers are getting only about a third of the price that the consumer pays for milk. Such issues must be dealt with, or we will end up with no production in this country and everything produced elsewhere.

I wish the Minister for Enterprise, Trade and Innovation well in his new portfolio and congratulate him on his appointment. I look forward to many battles together — although I hope those will not be necessary and we can do business as well.

I thank Deputy Morgan for his good wishes.

In response to Deputy Crawford's question, I hope that with the appointment of John Travers, we can put in a voluntary code of practice. That can be converted into an absolute code of practice enshrined in law. I hope that if we can get the co-operation of both sides under the chairmanship of Mr. Travers, there will be a fruitful outcome on what has been — and still is — a very contentious issue.

Voluntary does not work with that group.

We will make the code mandatory if necessary.

Written Answers follow Adjournment Debate.

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