Seanad debates

Tuesday, 13 December 2005

Competition (Amendment) Bill 2005: Second Stage.

 

3:00 pm

Photo of Paul CoghlanPaul Coghlan (Fine Gael)

I understood he was referring to the authority's reputation but the Senator is entitled to his own interpretation in that respect. If Senator Ross is listening, I am sure he will contribute to this debate.

It is also extremely worrying that three of the five positions in the authority are currently up for change. The lack of continuity and differing priorities that this will bring about is obvious. I am deeply concerned about the low productivity of the authority. The Minister constantly refers to the authority as one of the leading such authorities in the world. However, I suspect he has a big job convincing many people in business and consumer groups that it is as effective as he would like it to be. With the promise of one prosecution in a year and a handful of civil cases, it does not act as deterrent against anti-competitive activity in the economy.

I hope that one outcome from conferring on the authority responsibility for enforcing legislation directed at the grocery sector is that it will face greater pressure to perform. In this respect, I return to the report produced by the Minister's officials. The report states that they were unable to determine the impact of the groceries order on prices. However, there was a remarkable statement at the start of the relevant section of the report, which noted that different predictions on the impact of prices had been made by different groups and organisations, including the Competition Authority. As Members will recall, the authority produced statistical data during the summer to the effect that the abolition of the groceries order would save Irish consumers approximately €500 to €1,000 per year. When tested on these claims by the Oireachtas Joint Committee on Enterprise and Small Business, the veracity of the authority's statistics was placed seriously in doubt by the Central Statistics Office. It transpired that the authority had been very selective in the manner in which it had presented its data and that material presented by it was inaccurate, if not misleading.

It is interesting that the Department does not regard the authority's presentation of inaccurate and misleading data as presenting any difficulty. At the outset of the chapter on the impact of the order on prices and inflation, the Department states:

In what follows we neither make, nor imply any criticism of any party in the way in which they have presented their chosen statistics. It is in our view an entirely valid use of statistics to choose the data that best illustrates your argument or case.

I do not accept such comments from the Department in regard to the Competition Authority. The authority is a statutory agency, established by the Houses of the Oireachtas, with the purpose of advising on competition policy. It ill-behoves a statutory agency to produce selective or misleading data for any purpose. It is notable that the Department does not endorse or accept the Competition Authority's analysis of the impact of the revocation of the order on prices. I hope the Department will take a less lax attitude towards the authority and start to demand better levels of performance and accountability from it.

I have a number of specific concerns about the legislation with which I would like to deal. First, and on a general level, I note that any party that breaches the new provision of the Competition Act relating to grocery goods will not be liable to prosecution for a criminal offence, as applies to other aspects of the Act. It seems strange that there are two different regimes applicable under the Act, where some conduct that breaches the Act constitutes a criminal offence, but conduct relating to anti-competitive activity in the grocery trade does not. I am not sure of the reason for this and perhaps the Minister might enlighten us on this significant policy change. I would have thought that the same level of penalties should apply.

I also note that the definition of grocery goods contained in the Bill is far more restrictive than the definition of grocery goods provided in the groceries order. Under the order, grocery goods included food, drink and other household goods including detergents, personal hygiene items and similar goods. I do not understand the reason the Minister has narrowed the scope of these provisions to exclude such a wide category of goods. Is it not the case that suppliers and manufacturers of such products are entitled to benefit from the provisions that he is introducing today? Perhaps the Minister might enlighten us on that.

I also note that the Minister has not treated intoxicating liquors any differently from other grocery goods in this legislation. I am sure all Senators would have noticed the prevalence of advertising and promotions for intoxicating liquor by the main multiples over the past number of weeks. While low prices are of benefit to all consumers, it must be of concern if price promotions are to be based around cheap alcohol. Given the Minister's previous position in the Department of Health and Children, it would be curious and surprising if this legislative change facilitated the development of a cheap booze culture across the State. In this regard, it is important that the Minister takes account of the views expressed by a number of agencies and groups concerned about trade matters which have expressed concern.

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