Oireachtas Joint and Select Committees

Tuesday, 23 April 2013

Joint Oireachtas Committee on Agriculture, Food and the Marine

Groceries Sector: Discussion (Resumed) with FDII and IFA

2:35 pm

Mr. Paul Kelly:

Deputy Deering referred to bureaucracy and costs. When the debate on GSCOP and the ombudsman was taking place in Britain, studies were carried out by the relevant authorities. That was a few years ago and the position may have changed - either upwards or downwards - in the interim. However, the authorities in Britain calculated the cost of running the office of the ombudsman at £5 million. At that stage, this equated to 1p on people's weekly shop. That is for a market of 60 million people as opposed to one of 4.5 million. The draft statutory code for this jurisdiction refers to the appointment of an officer who would have a series of powers that would be quite similar in a number of respects to those of an ombudsman. It is difficult to comment further until the Minister for Jobs, Enterprise and Innovation publishes the legislation and the associated statutory code. In the context of what was available in draft form, it was envisaged that an officer would be appointed. It is not clear whether said officer would operate within the Department or within the combined entity that will be created when the Competition Authority and the National Consumer Agency are merged.

On Deputy Michael McNamara's question regarding farmers' markets and so on, that issue arises from time to time. The question in this context is whether it is possible to put in place a lower threshold. That issue arises from time to time and has been successfully addressed in other legislation applying to SMEs, but it is one to be considered. The only proviso is that we are potentially talking about food safety. The voluntary aspect having regard to some of the risks which can be associated with food not produced or stored properly is significant from a health perspective. These concerns would need to be taken into account in considering whether a lower threshold would be appropriate.

On Senator Darragh O'Brien's statement, I agree with what the Chairman said. I would differentiate between costs, including the cost of promotional plans for the year and so on. Even within the food supply chain we see differences in categories. One of the concerns of some companies is related to a promotion being cancelled at short notice. The costs associated with this will differ greatly if one is producing ambient packaged products which can be kept in the warehouse and diverted somewhere else or if one is providing perishable fresh produce. The implications in terms of different practices can vary, but it is our view that the draft code, in the way in which it has been phrased, has the capability to deal with these and bring a degree of fair trade back into the relationships between suppliers and retailers. I acknowledge and agree with the Senator's point that ultimately there must be a good working relationship between suppliers and retailers which provide the outlets for the produce of the vast majority of companies. When they retail, they can do it very well and it can be a very beneficial relationship both for suppliers and retailers and, ultimately, the consumer. Our point is that there is an aspect of that relationship that is problematic. The statutory code, if it can be introduced as a matter of urgency, is a way to address this aspect.

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