Gerald Nash (Louth, Labour) | Oireachtas source

I move: "That the Bill be now read a Second Time."

I will be sharing time with my colleague Deputy Bacik. I am pleased to speak on the Competition and Consumer Protection (Unfair Prices) Bill 2023. When I introduced this legislation on First Stage two years ago, the rate of inflation was at levels not seen in decades. A confluence of grim circumstances, some of which were the consequence of Russia's illegal invasion of Ukraine, saw the price of basic staples, such as bread, eggs, butter, pasta and so on, rise in price by close to 20% in some cases over a short period. Allied with post-pandemic supply chain problems, rising energy , transport and labour costs saw input costs more generally climb significantly. Pretty much all of those costs were passed on to hard-pressed customers doing their weekly shop.

There was also a clear suspicion, as we will recall, and not without foundation, that multinational corporations, including the big supermarket multiples around whose stores we push our trolleys each week, were using the cover provided by the energy cost crisis to push prices up even further, engaging in profiteering and, in some cases, posting inexplicably high super-normal profits. Indeed, in 2023, that radical left-wing hotbed, the European Central Bank, ECB, warned that large corporations were using the energy crisis to boost their margins. In 2023, the chief economist of the ECB, Mr. Philip Lane, warned that companies across Europe were using what became a gradual fall in input costs to boost their profits, perhaps keeping the prices of goods and services artificially high for longer than the market could justify instead of passing on lower prices to consumers.

This form of profit taking at the expense of consumers has an apt term of its own, namely, greedflation.

Professor Lane, who is a former Governor of the Irish Central Bank and, indeed, who worked in Trinity College, said the easing of some supply chain bottlenecks had not made its way into retail prices. This was despite producer prices decreasing strongly in the last while. He said this had enabled some firms to increase their profit margins. Two years on from the start of the cost-of-living crisis, the price of the every day goods on which we all rely and the services on which we depend are still high. Input costs have come down, stabilised or plateaued. The pace of underlying inflation has slowed but the cost of the weekly shop in the last 12 months has shot up by 5%. Wage growth this year is expected to average 3.66% so the hard-earned euro in your pocket is expected to stretch ever further.

The UCC economist, Oliver Browne, writing on the RTÉ website recently, said he holds out little prospect of grocery prices falling anytime soon. He said that "while some global pressures may ease, others, such as climate change, labour costs, and geopolitical uncertainty, are likely to persist." He further said that "global volatility means that significant price drops were unlikely in the short term." That is an interesting prediction for a number of different reasons. With elevated grocery prices now sticky, my fear, and the fear of my Labour Party colleagues, is that the threat of a tariff war between the European Union and the US, and the disruption that would create in global trade, while having a real impact on the cost of doing business, will end up giving some large, dominant corporations carte blanche to usher in a new wave of price hikes at the supermarket and lay the blame at the door of tariffs. It was energy costs a couple of years ago; it is now tariffs sneaked in under the cover of circumstances that are beyond most people's control. A repeat of what we saw in 2023 is likely to be on the cards and we are still living with the very real consequences of that period for working families across this country.

The cost-of-living crisis has not gone. It was elevated in 2023 but there is a permanent cost-of-living crisis across this country, especially for those who are on low, middle and fixed incomes. Of course, high grocery prices affect those on low and fixed incomes most adversely. The answer from Government during the early days of the cost-of-living crisis - note that I say "early days" because we are still in a cost-of-living crisis - was to bring in a series of much-trumpeted one off payments, some of which were famously untargeted and universal in nature. It then slavishly repeated that over and over again for longer than was capable of being justified.

Throwing money at a problem is not always the solution. The one thing Government parties repeatedly seem to be ideologically incapable of doing is to make regulatory interventions to bring major corporations to heel - normal kinds of interventions you would see in a regulated market economy, even if there are arguments that might suggest the potential for the abuse of dominant positions in market places, especially where weak or limited competition is not working in the best interest of the consumer. This is where competition and consumer protection law aligns. We are not good at protecting the interests of the consumer in this country. All of the evidence over the years has shown that. Competition and consumer protection law are intertwined. You cannot have one without the other.

In short, the question of potential abuse of dominant positions in marketplaces is actually at the heart of what this Bill seeks to address. Two years on from the height of the grocery price inflation spike, the cost of the basics is still extremely high. To give some examples, we have noticed ourselves from our weekly shopping that the price of a 1 Ib of butter is on average €4.69 at the moment. That is a 26% rise in a year, according to the Central Statistics Office. Kantar, the grocery price consultancy well known across the world, said price inflation in supermarkets is double what it was last year. What is the practical effect of this? All of this means a typical family will need to earn an extra €4,000 before tax to merely stand still when it comes to the price of a weekly shop.

Two years on the from the initiation of this Bill, the case for its enactment and for more tools to be made available to the Competition and Consumer Protection Commission, CCPC, is still strong. We know that pricing structures in the grocery trade are complex. We understand that. The retail trade is complex. It is hard to definitively rule out the possibility of price gouging among major retailers - keeping prices high for so long with a slow rate of decline. In response to the Labour Party's advocacy and campaigning two years ago on the impact of high grocery prices on Irish consumers, the Competition and Consumer Protection Commission decided, at the request of the then Minister for enterprise, Simon Coveney, to initiative a form of a desktop analysis on grocery prices in this country. Insofar as it could, it sought to address the question of potential price gouging in supermarkets.

I welcomed that assessment, which it published around this time two years ago. It made some very peculiar affirmations, though, that I dispute. I dispute them for a couple of reasons. Principally, it said that no evidence of price gouging of customers by large multiples was evident in the Irish market. I posed this question to it then and I repeat it now: how can you definitively rule this out when nobody - no agency and the public more generally - has any access whatsoever to reliable information on profit margins and profits more generally in the Irish grocery trade and supermarket sector? At best, I thought it was unwise for the CCPC to make that claim without the information it needed to make a definitive judgment.

This Bill seeks to bring greater transparency to the structure of the large supermarket businesses in Ireland and the sector more generally and to end the secrecy on pricing and profit margins. It is in the interest of consumers and competition. When we published this Bill two years ago, the then Minister for enterprise, Simon Coveney, said he would take steps that would lead to big supermarket players publishing their profits and being compelled to make the prices they charge their customers clearer. Since 2023, that Government and its new iteration has taken a vow of silence on this issue. There is nothing in the programme for Government that commits to an initiative like this. Nothing has happened. This Bill would amend the Competition and Consumer Protection Act 2014 and address this fundamental problem while arming the regulator with real enforcement powers to bring giant retailers to heel and ensure more transparency and fair pricing at the checkout. It would allow the CCPC to undertake a deep study and analysis of the costs large retailers incur, the profits they take and the prices they set, giving us a much clearer insight into how supermarkets in this country operate and what their pricing structures are. It would bring the kind of transparency to this market that has been sorely missed for far too long.

I hope we can make progress on bringing this legislation to Committee Stage for further interrogation. I understand that on Tuesday, Cabinet decided not to oppose this legislation. That is a good thing but I believe, especially given the fact we are entering into a very uncertain period with potential tariffs and so on, it is really important that the CCPC is empowered to stand up for consumers. We should use this legislation to empower it to do just that and to make our supermarkets honest.

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