Dáil Éireann Debate, Thursday - 29 June 2023
79. Deputy Ruairí Ó Murchú asked the Minister for Enterprise, Trade and Employment if he intends to meet food production companies in the near future to discuss the high cost of retailed/end product food items in the State; and if he will make a statement on the matter. [31587/23]
Amharc ar fhreagraThe food sector falls within the remit of the Minister for Agriculture, Food and the Marine and his Department keeps in close contact with the relevant actors in that sector. Fairness and transparency in the food sector are essential, as is ensuring that consumers have access to sufficient and accurate information before making a purchase. That is why Minister McConalogue is establishing the new Agri-food Regulator under the Agricultural and Food Supply Chain Bill 2022. Price development along the food supply chain will form part of the remit of the new Regulator. It will have two functions in this regard: a price and market analysis and reporting function, and a regulatory enforcement function concerning the enforcement of prohibited unfair trading practices.
In terms of my own remit in relation to competition, I wrote to the Competition and Consumer Protection Commission (CCPC) in May requesting an assessment of competition in the grocery retail sector and whether there is evidence of excessive pricing on the part of retailers.
In its report, the CCPC states that it has not seen any indications of any market failure or excessive pricing taking place in the grocery retail market. In addition, the CCPC states that there is evidence that competition has improved in recent years on the basis of price, quality, location and service and noted that this has resulted in greater choice for consumers.
It is true that food prices in Ireland remain high when compared internationally and this is based on a number of factors. These relate to Ireland being a small island nation which inevitably leads to higher costs for transport, our small market size, staffing costs and the fact that we are a significant importer of energy and food produce. As a small, open trading economy, Ireland is exposed to global inflationary pressures, including fluctuations on international markets for food, commodities and energy.
However, it is a welcome development that food inflation in Ireland is declining and as of May was at 5.4 per cent which is below the EU average of 7.1 per cent and the Euro area average of 6.1 per cent. Despite our high price position, Ireland remains a competitive economy. Ireland was recently ranked as the second most competitive economy in the globe under the IMD World Competitiveness Rankings.
Ireland has an export orientated economy and food producers play a critical role in international trade. Indeed, Ireland’s prosperity is founded on the goods we produce and services we provide and sell abroad. Therefore, it is essential that Ireland maintains a well-functioning competitive market and it is very much in the interest of businesses to remain competitive in their respective sectors. Of course, Ireland also imports heavily, including food products. The the input costs of such imports and prices for which are determined elsewhere.
Nevertheless, this Government is concerned about the costs of groceries and the impact this is having on consumers and my colleague Minister Neal Richmond TD and I have been actively engaging with retailers and the CCPC to seek better outcomes for consumers. At last week’s Retail Forum, grocery retailers assured Minister Richmond that they will continue to pass the impact of any reductions in input costs on product prices to their customers and outlined the costs reductions that have been instituted to date. A further update from the sector will be sought from retailers and the CCPC will keep the sector under review.
