Denis Naughten (Roscommon-South Leitrim, Independent) | Oireachtas source

I listened with interest this morning to the contributions from the various speakers on all sides of the House. I have to say I really enjoyed it. They say that when people spend long enough in this House, they see Members coming in here contradicting what they said many years before. I heard many of the contributions here today and I thoroughly enjoyed them from the point of view of the way attitudes have changed.

I remember when this issue in regard to the groceries order was first being debated in this House. At the time, we had the Competition Authority pushing the agenda to abolish the groceries order, with Mr. John Fingleton heading it up and campaigning vigorously that the groceries order was anti-competitive and anti-consumer, and this was endorsed by the National Consumer Agency at the time. Mr. Fingleton succeeded in convincing the Minister of the day, Deputy Micheál Martin, to abolish the groceries order. Within a few short weeks, Mr. Fingleton had left us and had gone to a similar job in the United Kingdom, and was vigorously arguing the exact opposite, namely, that there was a need to introduce a groceries order in the UK because he had seen the decimation that had been created by the abolition of the very same type of law in the UK. Things come around very quickly.

It is frustrating to see what has happened. We are now trying to clean up a mess that was created in 2005 with the abolition rather than the amendment of the groceries order. This Bill, in some small way, begins to deal with that but, sadly, the issue of alcohol and alcohol abuse, including its gross abuse through its use as a loss leader and the below-cost selling of alcohol, an issue that was highlighted at the time of the introduction of the legislation, is not being addressed in this law. We will have a report in June and there will be more navel gazing in regard to it. In the interim, however, we have the gross abuse of alcohol, which is freely and cheaply available, and is cheaper in some instances than a bottle of water or a litre of milk.

After the enactment of the Competition (Amendment) Act 2005, we saw very quickly that food prices were not reducing. In fact, if one looks at the EUROSTAT figures, food is still comparatively expensive in Ireland compared to other parts of Europe, so we have not succeeded in reducing food prices. Even some of the big players in the food sector, such as Procter & Gamble, Nestlé and Unilever, themselves complain about the dominance of the supermarkets, which is dictating the price they receive. They are the big players. What chance has a small producer, particularly in regard to non-branded goods such as perishable food products, when the big players in the industry feel they are being limited and restricted in regard to getting a fair price for their products?

We have a particular challenge for food producers in this country. The litmus test in regard to this legislation will be whether it ensures that primary producers get a fair return at the farm gate for their food product, one that covers the cost of production, leaves them with a basic margin and rewards them for the work and investment they are putting into producing the product. That will be the litmus test. This is not something that has come to the fore in recent times. I recall that in 2005 I published a food comparison in regard to the farm gate prices versus the supermarket shelf prices of food, and I published those figures again in 2006 and in 2007. Consistently, over that period, this showed a more than 200% markup from a farm gate price to the supermarket shelf price of basic foodstuffs. Taking a basic basket of goods which was costing the consumer €31, the farmer was getting just €13. Of course, the supermarkets were saying they did not have control over processing. I would like to know how much processing is involved in taking a head of cauliflower from north County Dublin and bringing it to a supermarket shelf in Dublin city centre, yet there was a 210% markup. The farmer was getting 50 cent while the retailer was charging €1.55 for that head of cauliflower at that time.

We saw what happened before Christmas in regard to Brussels sprouts, potatoes and carrots that were being sold at 5 cent. We were told below-cost selling of basic foodstuffs like that was illegal under the Competition Acts and that it could not happen, yet this went on under our noses and nothing seemed to be done about it. Interestingly, Agri Aware, through Ipsos MRBI, carried out a survey of consumers. Nine out of ten members of the public in this country felt that legislation should be introduced to give a fair price to farmers for foodstuffs, and seven out of ten believed that below-cost selling of vegetables was not to the long-term benefit of the consumer. We can see from the markup on fresh food produce that consumers are losing out in this regard. Consumers need to know why there is such a markup and farmers need to know why they are not getting a basic return for the work and effort they are putting into producing the product in the first place.

The Minister in his earlier contribution said he was going to sit down, along with his officials, with the Minister for Agriculture, Food and the Marine to draft a statutory code. That is not good enough. We need to see that statutory code and we want to see the colour of the Minister's money in regard to that statutory code. This legislation has been long enough coming - it has been promised and promised. I believe that, at the very least, in tandem with the publication of this legislation, the Minister should have been in a position to publish a draft of that proposed statutory code. I will be proposing that an amendment should be included in this legislation that will ensure that statutory code is, at a very minimum, adopted within six months and gets the formal approval of both Houses of the Oireachtas so that Members of this House can see that secondary legislation, have it debated and ensure it deals adequately with all of the issues.

These include issues such as hello money. Even though in theory this is banned under the current law, in practice it is happening.

As the Minister knows, in 2009, Deputy Creed highlighted the fact that individual food suppliers were paying €1 million per annum in hello money to retailers to get prime shelf space in supermarkets. He went on to say that ten companies were forced to pay €30 million during a four-month period to access secure shelf space in supermarkets. That practice is continuing today even though the Consumer Acts prohibit it. This is because the Acts put the onus on the supplier to initiate court action when the supplier is not in a position to do this because of the stranglehold the retailer holds. I would like to see amendments to the primary legislation - it is written in black and white here - to ensure that the food producers and processors are protected when selling their food products into supermarkets and that practices such as the use of hello money are abolished once and for all.

The final issue I wish to raise with the Minister is one I raised last week. I thank him for the reply I received on foot of my question on the Order of Business. As he knows, the issue I had was a far broader one, namely, competition law and access to markets across EU borders. Sadly, nothing is being done about this. I know the Minister for Agriculture, Food and the Marine is holding a summit on the beef sector tomorrow. Hopefully, we can see some progress in respect of that. An analysis carried out recently by the farming section of the Irish Independentshowed that Irish beef producers are experiencing price declines that are up to six times greater than those faced by their EU counterparts over the past 12 months. This is equivalent to a €200 per head loss or reduction in prices for beef farmers in this country.

The beef sector is an integral part of the agrifood sector in this country and is worth €2 billion per annum to the economy. However, the industry has been decimated over the past 12 months, particularly in respect of the collapse of bull beef prices which is having a direct impact on farmers' livelihoods. There is a significant price differential between here, Northern Ireland and mainland Britain. Not only do we have a price differential, but we have a situation where some factories north of the Border and in the UK are refusing to kill cattle born in the Republic of Ireland. The Minister for Agriculture, Food and the Marine and Bord Bia need to engage directly with their counterparts in Northern Ireland and Great Britain as well as the major retailers and processing groups to take these artificial and anti-competitive barriers out of the system. I raised this issue here today is because the retailers and major processors about which I am talking are operating in this jurisdiction, Northern Ireland and Great Britain. They have different rules depending on where those cattle are born. Factories are applying an uneconomic 400 kg weight limit on stock here yet the same meat company dealing with the same retailers into the same market is operating a 450 kg limit in other jurisdictions. This is making it virtually impossible for Irish farmers to produce product to go into those markets. It is not just those particular specifications. It happens with specifications such as the final residency period for animals. It is 70 days for Irish cattle but in some of their counterparts' requirements, it is down as far as zero and all for beef that is going into the UK market. Not only is it anti-competitive, it is manipulating the trade and pricing and profiteering on Irish beef and British consumers.

We have a bizarre situation where we can export live cattle on the hoof to Benghazi in north Africa yet we cannot export those same cattle to Belfast or Birmingham. There is something fundamentally wrong with a system that allows such a situation to arise. We have EU labelling laws that specifically provide for that, we have no problem with live trade from Ireland to other jurisdictions and this issue does not arise with the live trade across the borders between Spain, France and Italy and yet we cannot bring live cattle from this country across the Border to Belfast and have them slaughtered north of the Border. There is something fundamentally wrong and it needs to be immediately addressed because it is undermining the livelihoods of Irish beef farmers.

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