Leo Varadkar (Dublin West, Fine Gael)

Instead of competing for business, electricians in a town could form a union to negotiate terms, conditions and fees with local shopkeepers and enterprises. The Bar Council and the Law Society could similarly fix prices, terms and conditions for services provided to any social partnership group. This Bill is potentially a Trojan horse and if implemented would see a return of the medieval guild system of collective bargaining whereby architects and other professionals were required to form guilds in order to negotiate set prices for services, as well as creating barriers to others entering those services.

The Bill abolishes competition law to the extent that it applies to the self employed. As stated by the Competition Authority decision in the Equity case, if one were to take a wooden approach and find that all trade union members were exempt from the Act, the protection afforded to Irish consumers by the Oireachtas in the Competition Act 2002 could easily be rendered illusory. An association of independent pharmacists, publicans and barristers, to name but a few, would shortly obtain safe havens for their members by adding union to their name and obtaining negotiating licences. At the same time it is even possible that traditional companies could redefine themselves as partnerships and corporate bodies. Let us bear in mind that the Labour Party Bill does not just refer to individual self-employed people and unions, it talks about giving these rights to partnerships and corporate bodies. Traditional businesses could redefine themselves as collections of partnerships and corporate bodies and then use that provision to exempt themselves from competition legislation in the context of section 2.

Section 3 seems to be written with the intention of resolving the IPU-HSE impasse. I commend the Labour Party for seeking to resolve this problem but I do not believe this is the correct means to do so. However, despite the apparent intention, there is no specific mention of the IPU or similar organisations either in the Bill or the explanatory memorandum. The provisions of this section are very odd indeed. Essentially, it legalises price fixing in circumstances where the Government negotiates with an organisation representing a profession or trade for the provision of a service to members of the public or to a class of members of that public. The mechanism for achieving this is to empower the Oireachtas, following a declaration of the Government, to deem such an organisation not to be an association of undertakings for the purpose of section 4 of the 2002 Act. This exemption would not only be open to sole traders and independent professionals but also to members and employees of partnerships and corporate bodies under section 3(5)(b).

In sections 2(2) and 3(3), the Bill seems to try somehow to exempt consumers, stating that it is okay to fix prices against the Government, businesses or farmers but it is not allowed against consumers. While I am sure the Labour Members are well intentioned in this regard, this is naive. If one is allowed to fix prices with one's major business or customers there will obviously be a knock-on effect. For example, if electricians are allowed to fix prices with shop keepers and demand that they get a certain rate for an order to fix lights in SPAR or Londis, the knock-on costs of that will fall on the shops' customers. Equally, the fact that electricians can get fixed rates from their best customers will lead to higher rates for ordinary consumers. One cannot just write that into a Bill and think it will not happen. The naivety is really breathtaking.

The effect of this Bill would be to set back competition law by 15 years. Despite its intent, it is little more than a charter of rights for cartels, allowing groups of sole traders and partnerships or corporate groups as diverse as barristers, publicans, electricians and vets to establish a union, gain a negotiating licence and seek to fix prices with major customers and Government. Less competition in these areas will inevitably lead to higher prices for consumers and increased liability for the taxpayer.

My party has consistently sought to highlight the case against the Government on the issue of inflation. In particular, we focused on the high levels of inflation in Government-controlled sectors and sheltered sectors of the economy. Unfortunately, this Bill would undermine that view and thus it would be hypocritical of us to support it. It would be bad both for consumers and taxpayers. It stands contrary to our party's proposals in the lead up to the election to strengthen the Competition Authority with the power to impose fines for violations and to allow the authority to make legally binding civil decisions. This is a clear example of hard cases making bad law. Speaking on the original Competition Bill in 1991, Peter Barry got it right when he said that any exception to the Act should be explicit, rather than relying on the future interpretation of inexplicit phrases.

Further to these presumably unintended consequences of the Bill, we see a number of gaping holes and obvious legal flaws in it. Fundamentally, if enacted, the Bill would be of no benefit whatsoever to groups such as Equity or the IPU. It would not alter Article 81 of the EC Treaty or Regulation 1 of 2003, both of which must be applied by the Competition Authority and the courts regardless of the provisions of the Competition Act. It must also be remembered that the authority's rulings are based on Article 81 of the EC Treaty, not the Competition Act.

Large sections of the explanatory memorandum are deeply misleading. There is a suggestion that if the Competition Act were applied with full force and full effect it would result in trade union leaders being prosecuted as parties to a criminal conspiracy. To paraphrase the Labour Party leader, this is poppycock. Deputy Higgins referred to a number of recent cases but I would refer him to Grealy v. the Department of Education and Science, which made it clear that this was not the case. This should be known by people putting forward this type of legislation.

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