Mr. John Keane:

I thank the Chairman for the opportunity to address the committee on the Bill. I am accompanied by Mr. Liam Hanrahan, chairperson of the national agricultural affairs committee.

The Bill reflects the commitment in the programme for Government and EU policies that seek to improve market transparency in the agricultural and food supply chain, and most important, to improve the position of farmers, fisheries and smaller food producers in the agricultural and food supply chain.

The members of Macra na Feirme have consistently highlighted the need for a redistribution of power within the food supply chain. Given the fragmented nature of farm families and their distribution across the country, along with the enterprise variation that exists, all levers of the UTP regulations and further are needed to ensure that the balance of power is evenly distributed across all actors in the supply chain. There have been concerns consistently among farmers about price fluctuations in some markets along with the requirements of certain farm produce demanded by the consumer. However, at times of constrained supply, certain requirements are no longer a barrier for entry to the market.

Macra na Feirme wishes to highlight that farmers remain in the weakest position within the food supply chain. With five larger retailers controlling in the region of 90% of the domestic market share, it is clear that the individual farmer's position is clearly vulnerable and weak. This is particularly evident in the beef sector where, for example, the average suckler farm consists of in the region of 20 breeding suckler cows.

Macra na Feirme welcomes the establishment of the office of fairness and transparency for the enforcement of the UTP regulations. We have reservations that the new body has not been given a sufficient suite of powers commensurate with the responsibility to ensure fairness and transparency. In its recent submission, Macra na Feirme highlighted the need to ensure that powers of investigation into activities of a criminal nature, under the auspices of an ombudsman, be conferred on the new body. At recent sittings of this committee, different perspectives on the Bill were put forward that were in direct contradiction of conferring investigative powers on the new body. Macra na Feirme requests clarity on the powers of investigation for the new office, which may ultimately lead to prosecution.

Macra na Feirme notes that head 45 states: "The Chief executive may appoint in writing such persons or classes of persons as he or she considers appropriate to be authorised officers for the exercise of all or any of the functions conferred on an authorised officer under this Bill, as specified in the appointment." Let us compare with section 129 of the Data Protection Act, which states, "The Commission may appoint such and so many members of its staff, and such and so many other suitably qualified persons, as it considers appropriate to be authorised officers for the purposes of this Act." When a comparison is drawn, it is clear that a difference exists between the perceived internal capacity of the new office versus those offices established in other areas of enforcement. Macra na Feirme raises this issue in its submission in the context of the food ombudsman and seeks further clarity about the designation of an "authorised officer" and the origin or potential origin of such an officer.

Macra na Feirme welcomes the role that the new office plans to execute concerning price and market analysis. However, concerns remain that to establish the exact breakdown of value from producer to end consumer is not clearly laid out as a function of the new office. Transparency is largely evident at the point of sale from the primary producer to the processor in most supply chains. There is a degree of transparency at the point of sale to the end user, which is the consumer. There is a section in the supply chain that pertains to the main large actors where the price breakdown is unknown. Macra na Feirme highlights the recent Grant Thornton report, which was commissioned by the now decommissioned beef task force, in which it found that the actors within the supply chain, between primary producers and end users, were in some circumstances difficult to ascertain and garner information from. Leaving the provision of information within the supply chain as a voluntary contribution to the office on behalf of large actors within the supply chain will do little to achieve the objective of the new office, as stated earlier. Macra na Feirme would like the addition of powers that allow for the new office to examine and determine the exact breakdown of price, and value, within the agricultural food supply chain at all levels.

Macra na Feirme wishes to raise concerns over the definition of "commercially sensitive information", which has been an area of focus at recent sittings of this committee. The exact nature of this information is unknown in the context of its relative importance in determining price breakdown within the food supply chain. In its current form, this Bill has no mention of access to commercially sensitive information or what the new office interprets as commercially sensitive. It is essential for transparency and fairness that this matter be clarified and ascertained, and also to ascertain the willingness of retailers to engage in providing such information. It is in that context that Macra na Feirme has reservations about the willingness to share such information and engage on the basis of exchanges between this committee and the retail sector's representatives at a recent sitting. Macra na Feirme calls on this committee to ascertain the willingness to engage and determine if a recommendation to add an amendment in this area is necessary to the Bill.

Following on from its submission on the general functions of the office, Macra na Feirme wishes to highlight the need to ensure that a ban on below-cost selling is an additional enforcement power attributed to the new office. Below-cost selling was banned as part of the Restrictive Practices (Groceries) Order 1987, which prevented retailers from using food as a loss leader in their businesses. In 2006, the ban was removed by the then Minister for Trade, Enterprise and Employment, Deputy Micheál Martin. The position of the primary producer has only been weakened as a result of this ban. Macra na Feirme acknowledges the recent rise in the cost of food production but highlight that the proportionate share of the farmers' increase remains unknown and remains negligible when compared with the rising input price at farm level.

Macra na Feirme seeks the introduction of a ban on below-cost selling as a priority for the new office. Macra na Feirme would like an exercise carried out regularly to ascertain the costs of production using various farm systems in each sector. Once this information is established and updated then the financial requirements to meet the definition of "farm economic viability" needs to be added to ascertain the fair price for agricultural produce at the point of sale from the primary producer to the processor, factory or retailer. This is not something that is unique as when this issue is examined it is clear that the Spanish Government has passed legislation to ban the selling of certain goods at levels below the cost of production.

Macra na Feirme would like a strengthening of the confidentiality measures in the Bill. This is in particular reference to ensure the protection of primary producers and suppliers who come forward with complaints of suspected breaches of the UTP legislation.

Macra na Feirme echoes the comments made by the CCPC at the committee on the confidential nature of complaints. We consider this as a matter of high importance as ensuring confidence in the office from the start is paramount and ensures that the resources available to weaker actors in the supply chain are made available and protected.

Macra na Feirme seeks an extension to the period outlined in the Bill for investigation and prosecution of any breach according to the UTP legislation. The current proposal outlines is a two-year period post any potential offence be brought to the attention of the new office and investigated. We request that this be extended to three years on a permanent basis and call for a potential short-term extension to four years to allow for a bedding-in period for both the new body and that actors in the food supply chain can familiarise themselves with the remit of the new office. This request is reinforced by the fact that the new office will establish a database of information which may take some time, as outlined at this committee.

Macra na Feirme believes that it is hugely important that the new office be furnished with information relevant to its remit from any and all existing public bodies. This will facilitate smoother establishment and faster progress towards effective running. Has preparatory work been conducted between the bodies responsible for the establishment of the new office and the relevant statutory bodies? The CCPC would be of particular note concerning this matter given its recent investigation into the beef sector and its experience in the area. An effective handover by the CCPC and relevant bodies and Departments will be necessary for an effective transition.

Macra na Feirme seeks clarification concerning this Bill regarding the relationship between competition law, the offices responsible for its monitoring and the implementation and the new office of fairness and transparency. Uncertainty pertains to reporting and monitoring of activities such as cartel behaviour in the agricultural sector. In the event that cartel activity exhibits characteristics that fall foul of UTP legislation, and competition law, primary producers need certainty as to the relevant authority that will pursue any potential investigation or, in the event of both, the requirements that must be fulfilled for an investigation to be commenced.

Macra na Feirme requests an indicative funding amount, and the potential workforce scale and size for the initial start-up phase of the new office. The CCPC had a budget in the region of €13 million in 2019 that rose to €18 million in 2021 and has a workforce in the region of 100. It is paramount that the new office be furnished with the financial, knowledge and skills resources it needs to discharge its function fully while establishing the relevant datasets and information that will be required.

A budget of €4 million was announced in budget 2022 for the establishment of the new office. Macra na Feirme requests clarity on the use of this funding allocation to date and also on the €1 million that was announced in budget 2021.

Macra na Feirme also requests clarity on definitions in the Bill, particularly pertaining to evidence required for an investigation, criteria for an investigation and the requirements of a search warrant. The basis of this request is to provide clarity for primary producers in respect of the information needed by the office to pursue an investigation or further. The issue was raised at the committee with the CCPC and there remains ambiguity as to the requirements of the above. On communications, knowledge of the new office among primary producers is in the region of 50% and the knowledge of UTPs is in the region of 14%. Significant work will be needed to communicate the role, function and remit of the new office to the primary producers and to all actors in the supply chain.

Macra na Feirme welcomes the establishment of the new office of fairness and transparency. It does however have reservations that the remit of the new office does not extend far enough. Ensuring that the power in the agricultural food supply chain is rebalanced is the direct ambition of the UTP legislation along with being a priority of the CAP, where it is set out as a strategic objective. Macra na Feirme would like to see constant engagement by the new office with representatives of the farming sector as well as constant review of the implementation of the UTP legislation and the potential for additions to the legislation. Finally, I thank the Chairman and the committee for their ongoing engagement with us on all issues relevant to rural youth in Ireland.