Phil Hogan (Carlow-Kilkenny, Fine Gael)

It is with a deep sense of irony that this House debates this Bill. The Government has done almost nothing to improve the lot of our consumers. It has presided over an appalling lack of competition in every area from energy to insurance, from transport to communications. It is only since the Government was stung by a TV series broadcast last August that it is attempting to pull the wool over the eyes of an electorate whereby it wants to ignore the fact that it imposed no fewer than 41 stealth taxes in the past three and a half years. The Minister is attempting to reinvent himself as the champion of consumers in the context of this legislation, but already this attempt at political deception will fail.

This Bill is short in terms of words on pages and on benefit to consumers. The Minister can be assured that because of our total opposition to predatory pricing and market dominance, we will not support the Bill in its current form. It will become clear to him from his colleagues on the backbenches and to Fianna Fáil and PD Deputies who support the concentration of the market, particularly the grocery market, in the hands of the few, particularly the hands of the multiples, that in the long run consumers will experience less choice and competition and, ultimately, higher prices. In addition, the suppliers of indigenous Irish produce to those particular multiplies and retailers will be forced to outsource in order to remain competitive. Therefore, the consequent reduction in employment in the food sector is a worrying feature for many people.

Fine Gael believes that we cannot accept the Bill as it stands because it weakens a number of key protections for consumers and relaxes certain regulations dealing with the relationship between suppliers and the major multiples with no benefit to the consumer. I had no difficulty about reviewing the groceries order after it having been in place for 17 or 18 years, which we advocated, but what we needed was for the some of provisions of the groceries order, which were of considerable assistance to achieving a level playing pitch, to be included in this Bill. We wanted to see rebates and discounts and a guarantee that they would be passed on to consumers. There is nothing in the Bill to suggest this will happen.

We are particularly concerned with section 15B of the Bill. This section has five subsections. Subsection (1) prevents grocery goods undertakings from fixing prices, which is a good measure. Subsection (2) is a general anti-discrimination measure which prohibits dissimilar conditions being applied to equivalent transactions. This, again, is a measure we fully support. Subsections (3) and (4) deal with the issue of "hello money" and prohibit its payment, with which we also agree. However, we have a difficulty with subsection (5). It states, "Conduct described in subsections (1) to (4) shall not be prohibited unless it has as its object or effect the prevention, restriction or distortion of competition in trade in any grocery goods in the State or any part of the State". In other words, acts that are blatantly anti-competitive and were, up to now, automatically deemed to be illegal are to be subject to some vague test that will, in almost total certainty, render their prohibition inoperable. The result of this section of the Bill is to effectively open the door to "hello money", discriminatory practices and price fixing — the very anti-competitive practices the Minister stated he wanted to eradicate.

Fine Gael believes, and has consistently stated, that the groceries order should be replaced with a new law such as this legislation but which would take account of the changes required to the Competition Act and of the modern trends in the grocery trade. The new law, when enacted, should protect our communities from predatory pricing by multiples and ensure we have choice and diversity in the food sector where multiples and local shops can compete on a level playing pitch. We wish to see a facility in place that will ensure the banning of predatory pricing and allow discounts and rebates to be passed on to consumers and not put into the pockets of the retailers. It is for these reasons and the fact that such provisions are not included in this legislation that we cannot support it. The Bill, as it stands, will replace the groceries order with something worse. It adds a ridiculous, needless "get out" clause for all those who wish to abuse their market dominance and eliminate the competition.

In his response I want the Minister to explain the reason section 15B(5) was included; what benefit it could possibly bring to consumers, who lobbied for its inclusion, how it can be interpreted other than as a charter for anti-competitive practices and if he received advice not to include it, and, if so, why he ignored it. He might also explain what drove him to make something that is currently illegal, as it is blatantly anti-competitive and anti-consumer, now acceptable, unless the case for the prosecution is able to meet a series of tests which are not even set down in this legislation or in the Competition Act.

Ireland is crying out for change in the context of competition. Some 41 new stealth taxes have been imposed on everything from energy to stamps. We have suffered a drop of 22 places in our international competitiveness ranking. Dublin is now a more expensive city than Paris and Vienna and Ireland is the most expensive country in Europe. That represents Government action in terms of imposing additional charges and taxes in order to make the country uncompetitive. Government inaction on the consumer agenda is undoubtedly part of the reason we are in this mess. However, if we really want to tackle the root causes of our high cost base, which feature will be more vital in the years ahead, it is time to take on the anti-competitive behaviour and rid this country, once and for all, of the cartels and agreements that work against the consumer interest. The Minister has set out his objective to do that, but he is doing the opposite. The Bill signally fails to do that in this case.

In his review of the report of the public consultation process on the groceries order which was published in October, the Minister told the House that report recommended the 2002 Act will be significantly strengthened in order to specifically prohibit resale, price maintenance, unfair discrimination and "hello money". With the inclusion of section 15B(5), the Minister flies in the face of that statement and his Department's recommendation in that report. He is doing exactly what his critics said he would do, critics whom he ridiculed as being anti-consumer, anti-competitive and anti-change. The Minister has failed to live up to what he said when his Department's report was published. It is interesting that in his Department's report, to which he has frequently referred, one of the conclusions in one of the paragraphs I read was that there is no evidence that the abolition of the groceries will lead to lower prices. That is what the Minister and the Department concluded from all of the submissions received, which is an interesting conclusion, considering all the big change and hype the Consumer Strategy Group and the Competition Authority said this change would make. That is in the report.

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