Charlie McConalogue (Donegal, Fianna Fail) | Oireachtas source

I thank Deputies Kerrane, Michael Healy-Rae, Carthy and Danny Healy-Rae for their contributions. We had a significant discussion on this matter on Committee Stage as well. I outlined the position in relation to it then. I worked to be collaborative to make sure that the office we bring in here serves farmers and primary producers well, is effective and has the powers necessary to do its work. I acknowledge the role that all Oireachtas Members have played in that regard during pre-legislative scrutiny and right through the process. The joint committee, on a cross-party basis, put together the pre-legislative scrutiny report after meeting many stakeholders across the sector. There were 20 recommendations made in the pre-legislative scrutiny report. I accepted 18 of them either fully or very substantially. Likewise, throughout the process I looked at and assessed in detail the various amendments that were put forward with a view to accepting those which I believed would assist the Bill.

This will be the first time there has been a statutory independent office bringing transparency to the food supply chain and with the particular objective of bringing fairness in respect of primary producers and I want to ensure that office works well.

There are two issues on which the Deputies opposite and I disagree. Deputy Carthy referenced one of them, namely below-cost selling. The other is the role in respect of the application of competition law and anti-competitive practices. I outlined in detail on the previous occasion the reasons I do not believe below-cost selling will serve either farmers or consumers. One of those reasons is that below-cost selling was tried for a long time in this country and it did not work. That is why it was done away with in the mid-2000s. We had below-cost selling and it did not work. As it added cost but did not benefit consumers or farmers, it was discontinued. We have been there and tried that and it did not work. We have to learn from that.

In addition, I gave an example relating to whether below-cost selling would work in the context of our biggest product, namely, beef. I outlined that as 90% of the beef produced in Ireland is exported, no matter what price one is forced to charge for it within the Twenty-six Counties, that will only apply to 10% of the total beef production. Only one tenth of the animal that is sold by a farmer will be sold at that price. The other 90% of the beef will be sold at world market prices - the prices on all the international markets into which we sell. For every extra euro, for example, that is charged to the consumer, only €0.10 would go to the farmer, and it would only be Irish consumers who would be paying those higher prices. I gave the example of Northern Ireland. If a certain price had to be charged in the Republic, prices in Northern Ireland would be more in line with the world international prices and the price at which the other 90% of our beef was being sold. Consumers in the Republic of Ireland would be paying a higher price but it would have a negligible impact, if any, on the price farmers would be getting. I do not believe that would achieve its purpose, which should be to try to improve farm family incomes. All it would do would be to hit the incomes of all families within the Republic. It would have a negligible impact on farm family incomes.

There is also the context of all the challenges we have relating to the Border, such as in respect of fuel prices and so on. As I said on the previous occasion, there are such challenges from Louth right across to Donegal. Where would people buying meat for their family go to buy it? If they live close to the Border and there is a high price on one side of the Border but a price that is more representative of world prices on the other, not only will they go across the Border to buy their meat, they will also be taking other business with them. We can imagine what retailers would think about that. That is why I believe below-cost selling would not achieve the objective of trying to ensure farmers get fair play. As we know from the many years it was in place, it would not do that but, instead, would add red tape and cost to the supply chain and extra cost to the consumer while having no impact on the income of farmers. The Deputies opposite and I disagree on that.

It is open to Sinn Féin to take a different approach if it ever gets into government in the future. It can decide to introduce below-cost selling. Should it wish to apply that to the Twenty-six Counties, it could include as part of its offering to the Thirty-two Counties for a united Ireland that it would charge the Six Counties a higher price for beef. That would not be attractive to consumers anywhere, however, and neither would it be of benefit to farmers. The Sinn Féin Deputies and I disagree on that.

The other point on which we disagree is the issue to which the amendment pertains, namely, the application of competition law and anti-competitive practices. I am setting up the regulator to make sure we bring transparency to the food supply chain to get fair play for farmers and ensure they get fair reward and price for their produce. Ultimately, that is the price that is available on international markets, which is where the vast majority of the food farmers produce is sold. It is about transparency in terms of the price that is available on international markets and how that is traced back to the farm gate to make sure farmers are getting fair play. Deputy Kerrane has tabled a one-line amendment proposing that the agrifood regulator should cover anti-competitive actions in the food supply chain. We already have comprehensive law in respect of competition law and anti-competitive practices. One line in the Bill is not going to replace the reams of legislation it took to put anti-competition law in place for the CCPC. It simply would not put the architecture in place to do that. Rather, it would lead to confusion and duplication. This office will have the capacity to refer any unfair or competition issues it encounters to the CCPC to carry out that role. That is what it is obliged to do and it is what it will do. The CCPC has the investigative powers. It has comprehensive architecture legislation in place to be able to do that. Deputy Kerrane and I disagree on this point. A one-line amendment to comprehensive legislation designed to do many things to ensure farmers get fair play simply will not achieve what the Deputy hopes it will achieve.

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