Clare Daly (Dublin North, Socialist Party)

I agree with Deputy Murphy that there is no great reason to oppose this legislation, but neither is there cause for excitement about it. It provides additional sanctions for "lesser" transgressions of competition law to overcome some of the evidential requirements for certainty, as opposed to the balance of probabilities concept that applies in civil cases. In that sense, it is okay, but the idea that it offers a way forward to the regulation of the economic system in which we live or provides a solution to our economic problems is ridiculous. It does, however, gives us an opportunity to stand back and look at the bigger picture.

The legislation is being introduced as part of the memorandum of understanding with the European Union and the IMF to strengthen competition law. It is interesting to note how speedily we are moving on these issues compared to the lack of progress in dealing with so many other important issues which remain on the Order Paper for years and are never addressed. For some reason, we are able to move on this issue incredibly quickly.

This legislation must be seen in an international context, with the introduction of a raft of new company and financial legislation implemented across many of the western economies in response to the global financial crisis. This is largely being done after the horse has bolted. In some ways, this legislation seeks to achieve a situation similar to the one in the United States achieved after the stock market crash of the late 1920s that introduced regulation of the system. Unlike today, through the Pecora commission and the Glass-Steagall Act, significant laws were put in place to impose a system of regulation on the financial markets. It has been argued that this led to a certain degree of stability, but the key point is that it did not; rather, it allowed for a period of stability as ultimately the system ran into problems.

We must look at this aspect because even in this debate the point has been made that we must support competition, as it is good for everyone. It is the Holy Grail of the system of neoliberalism and is pushed by politicians and economists. Deputy Calleary has said wages were uncompetitive and that it is good they are no longer so. That simply is not true. Irish wage levels were below the EU average and are even lower now. How has this benefited Irish society or the economy? This argument was made during the debate on JLCs and wage rates, but the only consequence has been that it has facilitated the driving down of the conditions of workers in Ireland, while possibly boosting the profits of some employers. It has not increased the numbers in work.

The mantra that competition is good is constant. I come from the airline sector. If we were to stop people on the street and ask them if Ryanair had forced Aer Lingus to reduce prices, many would say it did and that it was a welcome addition to the market. It is simply not true, however, because travelling by air became more common internationally and when something becomes more widely available, the price inevitably falls; therefore, it had nothing to do with the arrival of Ryanair. It is not the case that competition leads to the offering of a better service to consumers and enhances conditions for workers. Examples have been given in the energy and communications markets, in which we have more electricity and telephone service providers operating, but prices have not fallen for the average consumer; rather, they have increased, while in many instances services are significantly worse. We see this clearly in the waste management sector, in which the turning of the public refuse collection service into a commodity to make profits has led to the ridiculous situation where every day multiple refuse company trucks empty different bins belonging to different people in housing estates. The only outcome has been to drive council operated services out of the market to be replaced by a private monopoly. As a result we have seen prices rise and a reduction in the service to the consumer, particularly for the most vulnerable who were in receipt of a waiver.

As other Deputies indicated, the opposite position obtained in the transport sector. I refer to the fact that public bus companies were unable to utilise the Dublin Port tunnel, which was built using taxpayers' money, because a private bus company bid successfully for the route. This is the madness of competition. I am of the view that competition is not a progressive force. One could legitimately argue that, as a system, competition covers up for the race to the bottom and that it pits the interests of one worker against another. Those who benefit from competition are not society as a whole, consumers, etc., but rather the very wealthy owners of private companies.

Let us consider a few examples of competition and the logic which underlies it. A couple of years ago Dell uprooted its operations from Limerick and thousands of jobs were lost as a result. This did not happen because Irish wages were uncompetitive at the time. Many of those who worked for Dell in Limerick earned approximately €11 per hour. In the year in which it left Limerick, Dell realised profits amounting to €80 million in this country and profits of hundreds of millions on a global scale. Why did the company move out of Limerick? The answer is that the opportunity arose for it to transfer operations to Poland and pay people wages of €3 per hour. We are continually informed that our low rate of corporation tax guarantees employment here. The corporation tax rate which obtained in Poland when Dell moved there was 19%. What was far more inviting for that company was the chance to exploit a workforce which would accept lower rates of pay.

Where does the logic which underpins competition lead us? The answer is that on a global scale it leads to a cul-de-sac. It did not prove beneficial to the workers in Limerick. Neither was it of benefit to their counterparts in Poland because a year or two after it moved out of Limerick, Dell decided to move on again. It sold its operations in Poland to Foxconn, a company from China whose workers were committing suicide on a mass scale at the time as a result of the horrendous conditions in which they were expected to work. That is the logic which underlies competition, which is not actually capable of taking society forward. It is enormously wasteful, it is a key part of the current phase of globalisation and it simply cannot be regulated. That is the lesson which has been learned from previous efforts to regulate the financial system.

In the current phase of globalisation to which I refer, massive amounts of money, goods and services are being moved across national boundaries. There is an inherent contradiction in this. On one hand, the system requires regulations but, on the other, it needs those regulations to be relaxed. Global corporations are now operating on a transnational basis and they have far greater clout and influence than many national economies. This is not in anyone's interests. The relocation of industries from western Europe or the US to Asia and elsewhere has led to the purchasing power of workers in the former decreasing. This led to many of the problems which gave rise to the crash we experienced in recent times.

In my opinion, competition is a cul-de-sac. It is demanded by a system where everything is commodified and where production takes place only on the basis of turning a profit. Competition is incredibly wasteful and completely irrational. It would be far better if we were to examine a more rational economic system under which production would be for use value and would provide for people's needs. Under such a system, information would be shared rather than promoting a situation where workers are pitted against each other in the interests of protecting the profits turned by a small number of people at the top.

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