Martin Heydon (Kildare South, Fine Gael) | Oireachtas source

I thank the witnesses for attending. The IFA farm-income review for 2012 indicated that while there was an increase in product price, this was outstripped by a greater increase in input cost, with fuel costs having increased by 30%, feed costs by 70% and fertiliser costs by 25% in recent years. What is Tesco's view of the increase in input costs as outlined by the IFA? How does that impact on the company's dealings directly with suppliers? As the Musgrave Group indicated earlier, I am sure Tesco deals with processors in the middle, but where it deals directly with smaller suppliers what cognisance does it take of that?

On the labelling and the horsemeat issue, the Tesco presentation stated that it accepted that there were failures throughout the food supply chain which requires the committed engagement of all of those involved in the food supply chain. Does Tesco have a bottom line on extracting better terms from suppliers and primary producers after economies of scale have been exhausted? I am mindful about the burgers found at Silvercrest that were retailing for 20 cent each. Obviously Tesco was buying them for considerably less - perhaps 8 cent or 9 cent per burger. How can the company stand over a product for which it is paying so little and still expect it to be a beefburger product? What is its bottom line? Processors can only be pushed so far. Without letting processors off the hook for mistakes they have made, we need to be mindful of the pressure they are under.

Tesco presented independent figures from the CSO under the slide on competition and pricing in the Irish grocery market. It is easy to produce agriculture farm-gate prices for 2010 given that we were coming from an extremely low base because 2009 was a dreadful year. Milk prices had been 37% lower in the previous year as a result. It is very easy to compare with a low base and make figures appear somewhat different.

Some years ago Tesco restructured its offices in Dún Laoghaire, putting emphasis on its remaining staff spending more of their time in its UK headquarters. I know it claims that 71 new Irish suppliers were added in 2012 and that it intends to add further suppliers in 2013. How many of the team based full time in Dún Laoghaire have jobs focused on targeting new Irish suppliers?

Does Tesco transport its goods around the country under its own brand or is there an individual contractor to do that? If it is one individual company, is it an Irish company? Does that company employ Irish drivers or does it contribute in any way to the Irish economy by buying fuel, getting vehicles serviced and buying tyres, etc., here?

Tesco referred to CSO figures so I will refer to a report by the Oireachtas Joint Committee on Enterprise, Trade and Innovation in February 2011, entitled Matters Concerning the Retail Trade in Ireland. It stated: "Large retailers are using their disproportionate share of market power to impose unfair conditions on suppliers." It referred to hello money and unwarranted payments, which represented a misuse of their market power in an unethical fashion. I ask the witnesses to comment. Does Tesco demand very large cash payments from suppliers to supplement its significant profits?

What is Tesco's view on the new UK groceries code adjudicator?