Mr. Kenneth McGrath:

We might start by answering the questions already asked. I am concerned we will lose the opportunity to respond to each of the important questions raised.

I will take up the matter of the code and, as an aside, deal with the matter raised by Deputy Pringle, which was not raised by any other member, in respect of our relationship with our staff. The situation at Lidl is not any different from many other employers in Ireland. We engage directly with our staff. We believe it is fundamental to our success that we listen to our staff and take time to talk to them directly. We put measures and structures in place to ensure that we get feedback from the grassroots, namely, the most important person in our business, who is facing the customer day in, day out. We have been operating in Ireland for 13 years, and many of our staff have been with us from the first day we entered the market. We develop from the ground up within our business and invest significantly in our staff. Many who started on the shop floor or the warehouse floor are in very senior positions today, also at director level within the business. That would not happen if we did not have a culture of engagement directly with those staff members. Our fluctuation rates are extremely low.

We were recently acknowledged in Ireland, on the first time of entry, by the Irish Institute of Training and Development, IITD. This year we won the award for best graduate placement, best large employer in retail and best overall employer in Ireland for our training and development. That is an accolade and an acknowledgement of which we are extremely proud, and the accolade extends to every member of our staff involved in training and development and the promotion and furthering of their colleagues' training across our business. In terms of our staff, therefore, we have a system that works for us and works for our staff.

In respect of the issues raised with regard to the code of practice, I understand the member's concerns in that he has possibly received the same feedback time and again. I can go back to my own files from 2009. We wrote our first correspondence to the then Minister on 30 September 2009. Lidl's position has not changed since then. We had our own code of conduct in place at the time of writing that letter. I fully appreciate the advantage it would give us as a competitor in the market to have all players operating on the same principle in terms of negotiation with and treatment of suppliers. Our concern is that these are alleged practices. They are not practices that we conduct or in which we become involved. The notion of potholing is alien to us as a business. With regard to the notion of "hello money" in any form, regardless of the way it is dressed up, it is not something we engage in as a business.

It is a concern from our perspective that we will have bureaucracy or additional compliance imposed on us as a business, and the net result will be that suppliers that have difficulties will not come forward. They will not use the legislation or the approach currently set out in the code to raise their concerns. As an industry, and an operator in that industry, we are in a situation in which we have additional compliance or additional cost without the intended result because we agree that the supplier must be protected. That is the reason we have our own code in place and the reason we conduct our business in the manner in which we conduct it day in, day out. The Competition (Amendment) Act 2006 laid down specific sharp practices that should be punished. There has not been any activity in that regard. That is where our concern lies. We have no issue with any Deputy or any member of the committee dealing directly with our suppliers. We stand over what we said in the committee today in respect of our day-to-day dealings. From a code perspective, that addresses some of the comments made.

Deputy Pringle raised the issue of cost, and said that we already have costs. That is correct. We carry compliance costs at this point in time. A new code will necessitate our reviewing everything from a legal perspective, looking at the wording in existing contracts and changing that where necessary to reflect the exact detail of the code. It will require specific filing obligations and audit compliance over and above what we engage in currently. There will be operating costs. I am sure specific training needs will arise as a result of the implementation of such a code. Those are real costs which will result in extra red tape or perhaps a significant shift in the way we currently engage in compliance. There will be set-up costs over time. These may be less significant in terms of their effect on our operating overheads as a business but we are cognisant that there would be a cost, perhaps without the intended benefit.

From our perspective as a player in the trade, we look to what is coming from the European Union also. We note that the principles put forward by the EU are very much directed at tackling head-on the issues that have been raised by this discussion. We have been in this consultation for three and a half years. From our perspective we would propose that perhaps the implementation take cognisance of the effect of those EU principles on the basis of harmonisation in ensuring that Ireland retains its competitive advantage, because cost is very much an issue for us in operating in the Irish marketplace. We have a higher cost base than any of our counterparts across the EU.