Joe Carey (Clare, Fine Gael)

I commend the Labour Party and Deputy Ciarán Lynch for bringing this Bill before the House this evening and I compliment Retail Excellence Ireland on bringing this matter to the attention of the public. The chief executive of Ennis Chamber of Commerce, Ms Rita McInerney, informed me today that 70 commercial properties are available at present to buy or rent in Ennis. Some 700 businesses are on the rates books of Ennis Town Council. It is a frightening reality that 10% of the rateable commercial properties in Ennis are vacant, unoccupied or have had to close down because of the recession. Unfortunately, this scenario is replicated throughout the country. It is blatantly clear that commercial retail rents in Ireland cannot be sustained in the current trading environment. Many of these rent agreements were struck during the height of the economic boom experienced in this country and bear no resemblance to the economic reality faced by our country. The regime of upward-only rents has resulted in many of our retailers, who were hanging on by their fingertips, going to the wall and bringing valuable jobs with them. I have spoken to many Clare business people who are struggling due to the unsustainable leases into which they are tied. They are crying out for some respite or a helping hand.

There were 38 retail insolvency cases in Ireland in the first two months of 2010. The retail sector in this country is in crisis and that must stop. It is a profoundly depressing experience to walk down any street in any city or town in this country and witness as commonplace white-out windows and the ever growing proliferation of "To Rent" signs. In the past fortnight, the significance of what is happening to smaller shops with the loss of four, five or six jobs on a daily basis was underlined by the closing down of two signature retail outlets, namely, the bookseller Hughes & Hughes and Bestseller, the renowned clothing chain which has gone into examinership. Both these retailers blamed excessive rents for their difficulties. Rents charges on properties are now exceeding labour costs. It is commonplace to find retailer's rents representing up to 20% of their revenue. This position is causing great financial stress to businesses and it is simply unsustainable.

It is somewhat ironic that, little by little, we are seeing some of those involved in our now discredited banking sector beginning to appear as landlords of buildings and shopping centres. Just as we must know what took place in our banking institutions, we must also know what is going on in the rental market. There must be full transparency in the process, which is not the case at present. The whole industry requires proper regulation and full disclosure. In short, there must be a level playing field for all parties engaged in the process.

It is obvious to all that the retail sector has taken it fair share of cuts. They have cut the prices charged to consumers and cut labour costs by letting people go or reducing hours. However, in the case of the most significant cost, that is, rent, nothing can be changed.

There is price flexibility in all walks of business life. We see it in sales, special offers for products, discounts for bulk purchasing and promotions. Without this flexibility the business world would simply not exist. The only area in business where there is no flexibility is in respect of rents. This evening, the Government has an opportunity to introduce a retrospective ban on upward-only rents. This ban will go some way towards stopping the loss of vital retail jobs. It will give much needed support to small and medium-sized businesses which provide these jobs. I urge the backbenchers in Fianna Fáil to stand up and represent the people who put them in here and to stand up for the small and medium-sized businesses that provide the jobs that people are crying out for. I am sick and tired of watching the shedding of crocodile tears by Deputies, moaning about job losses. Tonight, they have an opportunity to stand by their people and the retail sector of this country by supporting this Bill. I appeal especially to the backbenchers in this regard.

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