Tom Sheahan (Kerry South, Fine Gael)
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Question 8: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the action she will take with the main retail bodies here to address high food prices; what she proposes to achieve in the coming months in tackling high inflation on food; and if she will make a statement on the matter. [24069/08]

Mary Coughlan (Donegal South West, Fianna Fail)
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In the year to May 2008, the price of food and non-alcoholic beverages, as measured by consumer price index data compiled by the CSO, increased by 7.8%. The main cause of this increase in food prices has been the global rise in commodity and energy prices. Food prices have increased sharply in virtually all parts of the world and this has affected some developing countries particularly badly. Though I want to make it clear that I am not making any specific forecasts about future trends, there is evidence food price inflation has begun to moderate. The cumulative increase of 1.4% in food prices in the three months to May 2008, for example, was half the increase of 2.8% in the three months to April 2008. The consumer price index data for May 2008 also showed reductions over the preceding month in the price of a number of food items such as eggs, breakfast cereals, cheese and biscuits. The European Commission has stated recent falls in food commodity prices should generally continue, and markets stabilise, in the months ahead.

We cannot insulate consumers from the effects of global increases in commodity and energy prices and it would be misleading to pretend otherwise. We can take steps to ensure we have effective competition at the main points of the food supply chain domestically and that we have informed and empowered consumers willing to use their purchasing power to put pressure on retailers to compete properly on price with their rivals. The Government has asked the Competition Authority to monitor the operation of the grocery trade on an ongoing basis in respect of matters such as the competitive structure of the wholesale and retail sectors and the analysis of price trends. I have also recently requested the National Consumer Agency to undertake broader and more frequent price surveys. Where direct engagement with retailers is justified in the consumer's interest, I will not hesitate to act, as I have done recently, in response to public and Government concern about the apparent reluctance of the retail sector to pass on to consumers the benefits of the euro's appreciation against sterling.

Deirdre Clune (Cork South Central, Fine Gael)
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The Joint Committee on Enterprise, Trade and Employment met recently with the National Consumer Agency to discuss the high cost of foodstuffs in Ireland. In addition, many media reports state that basic foodstuffs are more expensive in Ireland than anywhere else.

The National Consumer Agency carries out numerous surveys and undertakes a great deal of research in regard to food prices. For the purpose of one particular survey, it purchased the same basket of items in each of the better known supermarkets and found there was only a 35 cent difference between them. This smacks of collusion or suggests competition is forcing the supermarkets to lower their prices. Is the Minister aware there is very little difference between the cost of a basket of goods purchased in either Tesco, Dunnes Stores, SuperValu and so on?

Mary Coughlan (Donegal South West, Fianna Fail)
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I am aware of it. A number of issues arise, including that of price tracking. The Competition Authority has been requested to examine a number of issues. It has already produced two reports on competitiveness and is currently preparing another one. There is no indication of anti-competitive practices within the market.

It is important to state — this issue was discussed in committee — that often it is the market that determines the price. We anticipate that the market will reflect any swings or changes in consumer attitude and power. We are currently trying to ensure this is what happens. I accept it is happening at present to a small extent.

In my previous capacity as Minister for Agriculture, Fisheries and Food, an issue of grave concern was the primary consumer who had not had an increase in income capacity for a considerable period, yet the consumer was discontent with prices in this area. There are differentials involved. If one reads the front page of The Farmers' Journal, one will note there has been a reduction in the price of dairy products. The fact that trading and commodities has increased considerably in the world market is outside our capacity. This is putting a great deal of financial pressure on people.

It is important, if we are to change the market and provide real value for money for the consumer, that we empower the consumer to allow this to happen. I am determined — I know we are all ad idem on this — to ensure people obtain transferability from the sterling-euro differential.

Leo Varadkar (Dublin West, Fine Gael)
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Will the Minister confirm that she does not believe there is collusion in the retail sector? Will she consider amending the Companies Act? If not, will she at least wave the stick at retailers that if prices do not come down the Companies Act will be amended to require them to publish their Irish profits, which is not currently the case?

Mary Coughlan (Donegal South West, Fianna Fail)
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I do not have any evidence of anti-competitive practices within the retail sector. If other people have such information, I would be more than happy to bring it to the attention of the Competition Authority. I do not have evidence to that effect at this moment.

Leo Varadkar (Dublin West, Fine Gael)
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Does the Minister have any suspicions in this regard?

Mary Coughlan (Donegal South West, Fianna Fail)
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One cannot act on suspicions or innuendo; one must have the facts. There are no indications of anti-competitive practices in the retail sector. The Competition Authority has examined the matter and has stated there is no evidence of anti-competitive practices in the sector. That is not to suggest people are not disgruntled and unhappy in regard to prices in the overall retail sector. It is on this basis the matter will be pursued as vigorously as possible.

Willie Penrose (Longford-Westmeath, Labour)
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I wish to make two points in respect of the Minister's response.

Brendan Howlin (Wexford, Labour)
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The Deputy must ask a question.

Willie Penrose (Longford-Westmeath, Labour)
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Is it not a miracle that the cost of the shopping basket of items in supermarkets A, B, C and D fall within 35 to 40 cents of each other?

Deirdre Clune (Cork South Central, Fine Gael)
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It is a miracle.

Willie Penrose (Longford-Westmeath, Labour)
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This would suggest there was no basis to the Competition Authority's examination of the pharmacy industry.

Like the Minister, I, too, was involved in agriculture, having been the Labour Party spokesperson on agriculture for nine years. We seem to follow one another around. There is a significant difference between the farmgate price and that which the consumer is charged. I am speaking now about Irish goods. Who is the beneficiary of that differential?

Mary Coughlan (Donegal South West, Fianna Fail)
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I can say, from my experience in agriculture, that this impasse has existed for a considerable time. The consumer liaison group within my Department investigated the matter. The Deputy will know no finite conclusion was reached in this regard.

Willie Penrose (Longford-Westmeath, Labour)
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Another miracle.

Mary Coughlan (Donegal South West, Fianna Fail)
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I do not do miracles. Issues such as costs for retailers are being examined. This will factor in some of the issues raised by Members of the House on a number of occasions. It is difficult to ascertain and determine what is a fair price for the primary producer and what provides value for money for the consumer. We must factor in the sustainability of the retail sector which is very important to the economy. We want to ensure we have a vibrant retail sector. All of these factors must be taken into consideration. It would be great if there was one answer to fit all. It is important to point out we are trying to address this issue.

I do my utmost as, I am sure, do most Members, to buy locally produced Irish goods and to encourage people in the food and beverage sector to do likewise as doing so provides added value from a true regional policy perspective. In regard to the production of branded and non-branded goods, various issues arise. I do not have a resolution to this problem. However, it is my fervent view that we will continue to push this issue. I know my colleague, the Minister for Agriculture, Fisheries and Food, will do likewise.