Richard Bruton (Dublin North Central, Fine Gael)
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The Bill, which I bring before the Seanad, is a major piece of reforming legislation which has three primary objectives. The first is to create the competition and consumer protection commission through the merger of the National Consumer Agency and the Competition Authority, thereby forming a powerful body with real teeth acting to protect and vindicate consumers' rights. This constitutes an important part of the programme of reform we are implementing across my Department. To assist the new body combat the issue of serious white-collar crime, new criminal investigation functions are being added to the significant powers that already exist which will, ultimately, improve competitiveness and protect consumers.

The second purpose of the Bill is to introduce strong regulations and enforcement powers to ensure fairness between the various parties in the grocery goods sector. Inequality between these players can potentially exist, leading to potential abuse in a manner that is not in the interests of jobs, consumers or sustainable safe food. Relationships will continue to be based on commerce while prices will continue to be set by hard negotiations because this is in the interests of consumers.

The third purpose of the Bill is the important issue of media mergers and acquisitions. The Bill foresees retention of the basic model of current laws, based on the principle of avoiding intervention by Government in media ownership except in specific circumstances following procedures determined by law. This is in keeping with the recommendations of the advisory group established to examine this area. Diversity of content and diversity of ownership across the media remains an important part of a healthy democratic society. However, it is important to modernise these laws to reflect international best practice and in line with the latest technological developments and that is why we are implementing in full the recommendations of that advisory group, with some enhancements and making important changes to update laws in this area.

I will now deal with each of these three elements in turn, the first being the establishment of the competition and consumer protection commission. As the House is aware, reform of the public service is one of the key commitments in the programme for Government and rationalisation of the State agencies is a major part of that commitment. As part of this rationalisation, the Competition Authority and the National Consumer Agency are being merged into a new body, the competition and consumer protection commission, which will result in a new body with stronger powers to deal with competition and consumer issues.

The basic aim of consumer and competition policy is to facilitate competitive markets with better services and lower prices for the consumer. The merger will benefit consumers, bringing together the current expertise and knowledge of both existing bodies into an effective integrated organisation. It will lead to efficiencies and synergies in carrying out the functions of the new body due to the existence of a stronger and more co-ordinated body dealing with consumer and competition issues. As consumer welfare is at the heart of both competition and consumer policy, the merging of the two bodies will ensure improved co-ordination of these two policy areas.

The Bill sets out, primarily in sections 8 to 46, inclusive, in Part 2, the structure, powers and functions of the new merged body. Many of these sections cover traditional provisions on the establishment of a new body and the dissolution of the existing bodies. In terms of structure and corporate governance, the new merged body will comprise a chairperson and between two and six members, who will act in a collegiate manner. This structure is modelled on that of the Competition Authority and, consequently, there will be no traditional board. The initial members of the new merged body will be the current members of the Competition Authority and the CEO of the National Consumer Agency. Appointments thereafter can only be made by me, as Minister, following an open recruitment process undertaken by the Public Appointments Service. As is the case with the two existing bodies, the new competition and consumer protection commission will be independent in the carrying out of a range of functions such as enforcement, investigations and merger determinations. The new competition and consumer protection commission will be accountable to the Oireachtas and to me, as Minister for Jobs, Enterprise and Innovation, in line with usual accountability and governance procedures and practices. My Department has worked, and is continuing to work, with both bodies to ensure a smooth transition from the two separate entities to a single dual functioning body responsible for competition and consumer protection since the amalgamation was announced.

Crimes under competition law are often viewed as victimless crime. However, let me be clear - we are all the victims of such crimes. Where the operation of the free market is restricted by collusion or other nefarious practices, the result is that consumers pay more than they should have to pay, whether it is to heat their home or buy a car. The State and all of us as taxpayers are the victims if companies engage in bid-rigging in respect of public procurement contracts for the building of roads, for the fitting-out of hospitals and schools or for any of the services purchased by the State. All this adversely impacts on national competitiveness and, ultimately, job creation.

For this reason, one of the purposes of this Bill is to strengthen the enforcement of competition law in Ireland by adding to the powers that will be available to the new commission. Breach of competition law is a serious white-collar crime and, as with all other forms of crime, those who commit crimes must be punished accordingly. A suite of additional enforcement powers has already been provided to the Competition Authority in 2012 under the Competition (Amendment) Act 2012 and additional staff were also sanctioned to be allocated to it in order to strengthen competition law enforcement. This Bill, in Part 7, gives additional powers to the new commission by extending the provisions of the Criminal Justice Act 2011 to serious competition law offences. In addition, some elements of the Criminal Justice Act 2007 have been incorporated into the powers of the new commission.

Part 7 of the Bill also proposes the extension of the provisions of the Communications (Retention of Data) Act 2011 to serious competition law offences. However, the implications of the recent European Court of Justice ruling on the relevant EU directive on data retention and Ireland's Communications (Retention of Data) Act 2011 in general are currently being examined.

Other substantive changes to the Competition Act 2002, in sections 47 to 73, inclusive, in Part 3, mainly revolve around the procedures to be operated by the new competition and consumer protection commission on merger notifications. Many of these emanated from a public consultation process held in 2007-2008.

On the setting of new thresholds for merger notifications, the setting of appropriate thresholds is crucial for ensuring that mergers that raise substantial lessening of competition concerns are captured by the compulsory notification system. At the same time, it is necessary to be mindful that these thresholds must strike a balance between the need for the competition and consumer protection commission to review transactions having a nexus to the State while not placing unnecessary burdens on business with respect to lodging notifications. The overall aim of these changes is not to seek an increase or a decrease in the number of notifications received by the new competition and consumer protection commission but to ensure that the notifications received have a real nexus to the State.

In tandem with the changes I have outlined, changes are being included to redefine the number of working days within which the new competition and consumer protection commission has to make a decision on notifications. Dependent on the operations of the new thresholds, a review of these new deadlines will be undertaken to ascertain if they are appropriate in the context of the new regime.

On the Consumer Protection Act 2007, a small series of five amendments is being proposed in sections 75 to 82, inclusive, of Part 5, on the basis of experience of this Act since 2007. It is also intended to bring forward a further consumer rights Bill in 2015, which will update sales law and build on the experience of the Consumer Protection Act 2007.

I will now address another important element of the Bill, namely, the provisions in Part 6 that regulate for certain practices in the grocery goods sector. This element has engendered a significant amount of debate and discussion inside and outside the Oireachtas. The grocery goods sector and all its constituent parts are important for the national economy, especially in terms of employment. The Government is strongly of the view that it is important to ensure a balance in the relationship between the various players in the grocery goods sector and that Ireland continues to have robust agrifood and retail sectors. Regulation of certain practices in the grocery goods sector is intended to achieve such a balance, taking into account the interests of all stakeholders in the grocery goods sector, including the interests of the consumer, and the need to ensure there is no impediment to the passing on of lower prices to consumers. This balance is an important issue.

As Senators are aware, the Oireachtas has examined this issue on a number of occasions. The Joint Committee on Agriculture, Food and the Marine, under the chairmanship of Deputy Andrew Doyle, published a detailed report in late 2013 on the grocery goods sector and highlighted a range of areas it believed were affecting the grocery goods sector. I also recall that the Minister of State, Deputy Sean Sherlock, had a worthwhile debate on the report in the Seanad in November 2013. The Joint Committee on Jobs, Enterprise and Innovation, under the chairmanship of Deputy Willie Penrose, also produced a detailed report on the retail sector in early 2011.

As Senators will be aware, in 2010 and 2011, unsuccessful attempts were made, under the guidance of Mr. John Travers, to secure a voluntary code of practice. At European Union level, a voluntary initiative on principles of good practices in the food supply chain was launched in September 2013 and adopted by certain European associations. However, not all elements of the supply chain signed up to this initiative, mirroring the divergent views on the value of a voluntary system that emerged in Ireland from the Travers report process.

In a parallel exercise, the European Commission published its Green Paper on unfair trading practices in the business to business food and non-food supply chain in Europe in early 2013 and commenced a public consultation on the paper to gather the views of market participants on the occurrence of these practices, their possible effects and the most effective remedies, if required. The Commission has considered the results to decide whether it will initiate any proposals in this area and it is understood a communication will soon issue from the Commission on the topic.

None of this precludes any member state from taking measures it believes may be required and such complementarity between European Union and national work has been recognised by the Commission. While we will take an interest in the implementation of the voluntary initiative and the impact of its development, it will not halt implementation of the commitment in the programme for Government to regulate in this area. To give effect to this commitment, the Government will introduce statutory regulation of certain practices. These will take the form of a series of regulations, with associated sanctions, rather than a code of conduct. This is a more powerful tool than a code.

The new competition and consumer protection commission will be the independent body assigned responsibility for overseeing and enforcing these regulations. The new body will be given the powers to enforce the regulations and will build on the considerable enforcement and investigative powers that the two current bodies have built up in recent years, rather than start afresh with a new body. Contravention of the regulations will be an offence, as will failure to comply with any contravention notice issued by the new competition and consumer protection commission. This body will also have the power to publicly list all undertakings that have contravened either the regulations or failed to comply with the contravention notices. This will inform consumers on which undertakings are not abiding by the regulations. The new commission will also be able to act on its own initiative or on the basis of information supplied to it. It must be pointed out, however, that in enforcing any regulations the basic tenets of fair procedure and natural and constitutional justice must be upheld. If no suspect practices are being carried out, there will be no issue for any contracting party to such relationships.

The introduction of any regulations does not and cannot guarantee anything in relation to the prices received by any given link in the supply chain. Negotiations on price will remain an issue between the contracting parties, as is the case in any commercial relationship. What the new regulations will be intended to achieve is to regulate certain practices rather than set prices. These provisions are enabling provisions and Part 6, which covers sections 83 to 85, inclusive, and section 86, sets out a long list of issues and activities which may be covered by such regulations when promulgated through a statutory instrument. I intend that this implementing statutory instrument be brought into force as soon as practicable after the Bill has been enacted. I will consult widely on the drafting of these regulations, including with stakeholders in the grocery goods sector and the Minister for Agriculture, Food and the Marine. I have also made a commitment to bring the draft regulations to the Oireachtas in advance as part of this consultative process.

Preparatory work on the regulations is taking place parallel to the Oireachtas consideration of the Bill. The statutory instrument will be accompanied by a detailed regulatory impact analysis. The use of a statutory instrument allows for a more rapid response to changing conditions in future, rather than amendments to primary legislation.

The measures being proposed are only intended to address the issue of fair trading between various parties in the grocery goods chain. Existing competition law will remain in force to counter price fixing, abuse of dominant positions, etc. The Bill does not and cannot be allowed to circumvent the existing corpus of competition law.

I will discuss media mergers, which are dealt with in section 74 of Part 4. Under the current system, if the Competition Authority determines that a media merger fails the competition test, the matter is closed and the issue is not referred to the Minister for Jobs, Enterprise and Innovation for a determination in the public interest. If the authority determines that the merger can be put into effect, the Minister may direct the authority to carry out a full investigation based on the notification and analysis from the Competition Authority of its decision and the details of the merger, as presented. As part of this process, the authority is required to give an opinion as to how the application of the relevant public interest criteria, for example, the strength and competitiveness of media businesses indigenous to the State and the extent to which ownership or control of media businesses and control of particular types of media business in the State are spread among individuals and other undertakings, should affect the exercise of the Minister's powers. If the Minister does not make a decision counter to the original Competition Authority determination, no further action is required. However, if the Minister makes a decision counter to the original Competition Authority determinations, this decision must be confirmed through the making of an order, which must be laid before the Houses of the Oireachtas.

Part 4 will fully implement the recommendations from the advisory group on media mergers, which published a report, known as the Sreenan report, during the lifetime of the previous Government. These recommendations are aimed at modernising the system for regulating media mergers to reflect international best practice and in line with the latest technological developments. However, the broad three-step process currently in place for media mergers will continue to operate. First, a determination will be made by the competition and consumer protection commission that a merger has taken place. Second, a decision will be taken by the competition and consumer protection commission on whether the merger should be permitted to proceed on competition grounds. Third, in the event that the competition and consumer protection commission allows the merger to proceed on competition grounds, a decision will be taken by the relevant Minister on whether the merger should be permitted to proceed on the grounds of the public interest aspect. There is no provision for, nor did the Sreenan report recommend, an ongoing regulatory function in respect of media ownership.

The power only falls to be exercised in the event that a media merger takes place as defined and that merger is permitted to proceed on competition grounds. The key concept relating to the definition of a merger remains the concept of "effective control" and no changes are recommended or provided for in this respect.

Section 74 or this Bill includes a comprehensive suite of proposals to implement in full the recommendations of the Sreenan report with two enhancements. The first sees a change in the relevant Minister for such public interest considerations from the Minister for Jobs, Enterprise and Innovation to the Minister for Communications, Energy and Natural Resources, with a major role for the Broadcasting Authority of Ireland in drawing up a report for the Minister prior to the latter making a decision in the matter from a public interest aspect. The Sreenan report noted that both Ministers could be the relevant Minister for the purposes of this test but it came down on the side of the Minister for Jobs, Enterprise and Innovation as the Competition Authority, an agency reporting to that Minister, would be responsible for the competition test of the proposed merger. However, given progress in the areas of media, broadcasting and the digital sector, it is more appropriate that the responsibility be transferred to the Minister for Communications, Energy and Natural Resources.

The second change relates to designating the relevant joint Oireachtas committee as a notifiable body when the Minister for Communications, Energy and Natural Resources is considering any proposed media mergers from the public interest aspect. The Government believes the opinion of the relevant joint Oireachtas committee is a very important element of the consultative process that should be sought. The Sreenan report did not foresee a specific role for the Oireachtas but the Government believes this should be included by way of a notifiable body in the consultation process. This will complement the views of a specific advisory panel that may be established to assist in the examination of any given media merger.

The proposed Bill sees the new amalgamated competition and consumer protection commission's role strictly limited to examining the media merger from a competition angle only. The public interest test and final decision rests with the Minister for Communications, Energy and Natural Resources. The new amalgamated commission will have no role in this aspect, unlike the current position, where the Competition Authority has to give an opinion in the matter. This clear division of responsibility is one of the cornerstones of the Sreenan report's recommendations. It also includes a wider set of definitions and a longer list of relevant criteria to be taken into account, and it sets out a formal consultation process that should be followed in making a determination in the public interest.

This effective mechanism for overseeing competition and consumer empowerment in the market, which is one of the main aims of the Competition and Consumer Protection Bill 2014, is the best way to ensure there are no barriers to entry and that jobs growth and innovation are promoted. This will promote competition and consumer standards, long-term competitiveness and jobs growth. I look forward to debating with Senators now and on Committee and Report Stages, which will follow.

Mary White (Fianna Fail)
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I welcome the Minister. This Bill merges the Competition Authority and the National Consumer Agency and new criminal investigation functions are being added to the significant powers which already exist to combat serious white collar crime and ultimately combat higher prices and protect consumers. The Competition Authority and the National Consumer Agency have welcomed the publication of the Bill, which will merge them to form the competition and consumer protection commission, with a dual mandate to enforce both consumer protection and competition laws. Regulations and new investigation and enforcement powers are included to ensure fairness between suppliers and retailers in the grocery goods sector. According to the Department press release, relationships will continue to be based on commerce and prices will continue to be set by hard negotiations. This is in the interest of consumers.

It is important to remind people in the Chamber that the Irish retail sector currently employs 275,000 people, which is the same as the numbers employed in IT, agriculture, forestry and fishing and the financial insurance sector combined. Retail generates €5 billion in taxes every year, including €1 billion in employment taxes, and the sector paid over €8 billion in wages in 2010. Most people in Ireland do not realise the important point that 90% of Irish retail businesses are Irish-owned rather than multinationals, with 77% family-owned.

With regard to media mergers, the Bill fails to address the central question of when a level of media ownership becomes too large. However, the three-step test for a media merger will remain the same. The new competition and consumer protection commission will still determine if a merger has taken place and if it should be allowed to go ahead on competition grounds. The proposed law incorporates the majority of the recommendations of the advisory group on media mergers and the Sreenan report, so the new law will therefore contain a statutory definition of media plurality, referring both to ownership and content.

The most anti-competitive entity in Ireland is the State itself. Recent inflation figures indicate that although overall price levels are subdued, in areas where the State decides or significantly influences prices, they are rising. Businesses are reducing costs to consumers and becoming more efficient but the State seems immune to such pressures. This Bill fails to impose any obligation on the Government to respond to Competition Authority studies on aspects of its own behaviour. This is in contrast to the UK Government, which is required to respond to its competition agency's findings in a timely manner. Following the departure of the troika, the Government seems to have abandoned any attempt to reform the legal, medical and professional services sector. Businesses will continue to suffer from having to pay among the highest costs for these in the OECD, which is akin to a crime.

We know from a recent report of the National Competitiveness Council that Ireland lacks competitiveness in many areas. This arises from a failure of competition and regulation, and the report issued by the council indicated that costs in many areas are too high. Ireland is near the top of the European league for electricity costs, as I have stated on numerous occasions in the Seanad, and waste disposal, treatment and water costs to businesses are also far too high. The interest rate cost for businesses getting credit is also much higher than the euro average. Postal, transport and computer services costs are also on the rise again. The price of a normal stamp is going to approximately 70 cent.

The evidence from the competitiveness council report is clear and the improvement in competitiveness in recent years is being undone through a range of cost increases and pressures. The report states bluntly that Ireland remains a high-cost location for a range of key business inputs. The rate of inflation in the year to the end of March was 0.2% but under this figure is a growing disparity between price strengths in the sectors dominated by the State and those where private enterprise compete directly for consumer demand. The highest inflation over 2013 was recorded in State-priced or State-owned sectors such as education, where prices rose more than nine times faster than across the entire country.

Most of the country's private sector is improving competitiveness but the areas where the Government influences prices are going in the wrong direction. This is directly reducing the living standards and purchasing power of households. Approximately one third of the inflation index is demonstrating large price increases in elements like health insurance, motor tax, cigarettes and tobacco, third level education, electricity, bus and rail travel, postal services, licensed premises alcohol and off-licence alcohol. All of these are influenced very significantly by Government taxes and charges. Private rents are also rising, particularly in Dublin, and this reflects the dysfunctional housing market and may also be influenced by landlords passing on the property tax to tenants. By contrast, approximately two thirds of the index is demonstrating price decreases, most significantly in mortgage interest due to European Central Bank rate cuts and energy costs.

Fianna Fáil believes the evidence of higher loan costs to businesses should be addressed urgently. So far the focus has been on credit availability, which remains problematic, but the National Competitiveness Council report indicates that credit cost is also an issue. Our banking sector cannot be allowed to rebuild its profits on above-average loan costs to business. Where is the Central Bank with this issue? Above all, this demonstrates the need for more competition in banking and finance supply. Members of the regulated professions should be obliged to meet strict price transparency requirements, and one approach would have professionals such as solicitors, barristers, dentists and medical doctors be required to post prices for services, including hourly rates on the relevant regulator's website. All professions should be required to provide clients with meaningful cost estimates in order to protect customers.

There is an urgent need for an independent regulator of the legal profession. It is important to note that independent regulation does not necessarily preclude a dimension of internal regulation. While legislation is before the Dáil to slash legal costs, it is taking a long time to bring it through the House.

Energy costs remain an issue but it looks like the proposed White Paper will focus mainly on environmental issues rather than business competitiveness. Environmental concerns certainly are important, but the issue of costs must also be the focus of Government action.

Reference has been made to how taxpayers bailed out several of our banks. I take this opportunity to point out that the treatment of Tony O'Reilly by Allied Irish Banks has been absolutely abominable. Mr. O'Reilly created and developed businesses that employed thousands of people in this country. He was a huge inspiration to me when I was younger and trying to set up a business. He treated everybody the same and was a gentleman in all his dealings. Members will recall that he and his brother in law invested €400 million in Waterford Crystal. It was remiss of the then Government, of which my party was a member, to refuse the support that company needed. I always wanted to start my own business and I remember noting Mr. O'Reilly's observation that a business person cannot take a staccato approach. Instead, one must be like an athlete training for the Olympic Games, relentless and persevering. He was an inspiration to people in this country at a time when we had very few heroes. His treatment by AIB is absolutely disgusting and disgraceful - likewise the behaviour of the media in putting him on the rack. I do not know what this conspiracy is all about.

Paul Coghlan (Fine Gael)
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I welcome the Minister to the House and thank him for his comprehensive overview of these proposals. The Bill aims to merge the Competition Authority and the National Consumer Agency into a new pro-consumer body. This reform is long overdue and part of the Government's programme to merge regulatory agencies and secure necessary efficiencies. The Bill seeks to update competition law in a number of different respects including, in particular, in the areas of media mergers and the grocery sector.

A strong and diverse media landscape is a key part of the necessary infrastructure for a functioning democracy. I welcome the guidance and clarity provided in this area by the legislation and hope the provisions being introduced will aid in maintaining a diverse and healthy print and electronic media landscape into the future.

I also welcome the measures being introduced to address competition matters in the grocery sector. This is an area that needs to be monitored closely to ensure the relationships between retailers and suppliers maintain the competitive dynamic necessary to allow consumers value and choice. We have a competitive landscape for retail in Ireland, in part due to the sensible and reasonable measures taken by the Government on retail planning. We have, through our planning system, ensured there is balanced retail provision. No one shop or chain dominates and we have both large and small stores competing to ensure consumers and communities are well served.

We often criticise ourselves for failings in key areas. On retail planning, however, we have largely got matters right. We have not facilitated the big-box retailers that suck up trade from surrounding towns and centres. Instead, we have facilitated, in most cases, a sustainable approach to retail development which focuses on suitable locations close to where people live. The Minister will need to monitor the adherence to the code for the retail trade. Retailers and suppliers are inventive and will look for ways to wriggle out of new compliance requirements. The Minister must ensure the law keeps pace with the regulatory intervention.

I supported the objectives underpinning the groceries order. The way in which alcohol has been sold below cost shows that some of the concerns expressed by those opposed to its repeal were well placed. It is an unintended consequence of that action that alcohol sales have become such a major aspect of price competition between retailers. This issue needs to be tackled urgently and I hope the Minister for Health will bring forward proposals in this regard.

I welcome this Bill and hope it achieves the objectives that underpin its introduction. It is a major piece of reforming legislation with three main aims, which the Minister dealt with more than adequately. This is one area of the law where constant vigilance is required to ensure legal prescriptions keep pace with commercial practices that have the potential to distort trade or have a damaging impact for consumers.

Feargal Quinn (Independent)
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I welcome the Minister to the House and the opportunity to discuss this Bill. The provision it contains for the rationalisation of two quangos which seem to be doing more or less the same job is particularly welcome. However, I have serious reservations that the Bill leaves the door open for the Minister to impose a huge number of potential legal regulations on the grocery sector, something that is unnecessary and overboard. In fact, one of the Government's objectives should be to facilitate small businesses. I acknowledge that the Minister is at one with me on this issue. The reality, however, is that the more regulations we impose on small enterprises, the more difficult we make it for them.

Will the Minister indicate how many people are employed by the National Consumer Agency? The Competition Authority's annual report tells us that it has 49 staff members, but there seems to be no corresponding information available in respect of the National Consumer Agency. The merger of the two bodies will, we are told, result in savings of some €170,000 per year. It is a worthwhile initiative given that the two bodies are, as I said, essentially doing the same thing.

If this Government is serious about helping retailers, one of the issues it must tackle is that of upward-only rent reviews. The Minister knows this is an issue I am very passionate about and I have talked about it at length. The Bill I introduced has been passed by this House and will go to the Dáil. I ask that the Whip not be applied to Government Deputies so that the Bill can proceed and, in due course and assuming it is signed by the President, have its constitutionality tested by the Supreme Court.

I am concerned about the impact of potential regulations affecting the grocery sector. We are trying to establish fairer relationships among all parties to the trade, but I do not hear enough about the interests of consumers. We are all aware of the concerns of retailers, suppliers and farmers, but there has much less discussion about consumers. The reality, however, is that every additional regulation applied to the retail sector has an impact on consumers. The Minister tells us he is seeking to achieve reform by introducing a series of regulations with associated sanctions rather than a code of conduct. There will be new obligations in terms of record-keeping and the mandatory inclusion of certain terms in written contracts. However, the provision in section 63B of the Consumer Protection Act 2007, as inserted by section 83 of the Bill, essentially gives the Minister - maybe not this Minister but certainly a future Minister - power to introduce a multitude of requirements in the sector at some later date. It is a very vague provision and, as such, gives cause for concern.

I have stated on previous occasions my opposition to the introduction of a statutory code of conduct for the grocery sector. It is not the intelligent way to go. Those pushing for more regulations have made clear their vested interests, including independent traders and companies with branded products which wish to prevent an expansion of private labelling. However, as I have said, the provisions set out in this legislation leave it wide open for a future Minister to impose more regulations on the grocery sector.

The subsection states that future regulations may specify the circumstances in which a relevant grocery goods undertaking that is a retailer or wholesaler may, or may not, seek payment from a supplier to retain shelf space or to secure better positioning on shelves, or an increase in the allocation of shelf space, for the grocery goods of the supplier. That is not good.
The grocery sector does not have elastic shelves. If there are three products on the shelf and someone demands that one puts a fourth one on, one has to negotiate to get the best deal. That is in the interests of the consumer. The Bill continues provides that regulations may "prohibit a relevant grocery goods undertaking from directly or indirectly compelling a grocery goods undertaking to make any payment or grant any allowance" in terms of promotion or advertising. That does not make sense. The marketplace is what determines the satisfaction of the customers. It seems like overkill, as the Competition Act 2002 prohibits or prevents the “compelling or coercing [of] payment or allowances for advertising or display of goods”. Why do we need even more regulations? Why will the grocery business now potentially be obliged to train staff just to comply with the regulations? This Government should aim to reduce regulations. I have spoken to the Minister before about the situation in Britain where if a new regulation is introduced, two old ones have to be removed. That was a brilliant move. There has been criticism of it but it seems absurd to me that we continue to introduce new regulations without doing that.
In my experience the grocery sector is hugely competitive, and grows more and more so every year. Consumers have been much more price conscious in recent years. There is no need for any worry in that area. The Minister is well aware that the Competition Authority has stated that the retail sector is highly competitive. I know from my own experience that it is so competitive one cannot stand still for a minute. One has to make sure that customers come to one’s shop rather than go to the shop down the road. To achieve that one has to coax them in, be it with price, service or quality, or a mixture of those. Those outside retail forget how much it has developed. It is extremely competitive.
For example, retailers armed with accurate price information, right up to date on their smart phones have the ability to renegotiate with suppliers for better prices and pass savings on to the consumer. They can even see in real time how certain marketing campaigns, including those of their competitors, have an effect on their sales. There is so much going on in that area that it is possible to achieve a great deal more than we are setting out to achieve.
We should consider alternatives to the regulations as set out in the Bill. We should consider voluntary regulation of the grocery sector instead of more legal requirements. There are some very good examples from elsewhere in Europe. France has a self-regulatory initiative called Commission d’examen des pratiques commercialesand in Belgium there is a voluntary code which has been very successful. It promotes dialogue between all links in the supply chain, from farmers to consumers. Why are we not considering some of the successful examples set by our EU neighbours? Many of them have found that a voluntary code linked to existing national legislation is the best solution. We are overlooking that here. We need something that would lead to a culture change, to improve the business culture. A voluntary code would be very useful in order to achieve this, a statutory code of conduct would not have the same effect.
We need a carrot not a stick. Instead of legal instruments are there other ways to encourage a more transparent and fair supply chain? Last year, Findus, the frozen food brand was tainted by the horsemeat scandal. It was reported that some of its products were found to contain between 60% and 100% of horsemeat. This was supposedly caused by a third party supplier. In the wake of this, and to try to address shortcomings in the supply chain, it signed up to supplier ethical data exchange, Sedex, which is a not-for-profit organisation which allows suppliers share trading data with retailers and brands online. It conducts health and safety audits throughout the supply chain and aims to create much more trust in the retail industry. This is an interesting example of what could be done. Has the Minister heard of it?
We are well aware of the National Consumer Agency’s advertising, which more or less boils down to getting the consumer to shop around. I do not know that it makes sense for our taxpayers’ money to be used to send that message to citizens. It is not necessary. People know what they have to do. I am not blaming them for trying to do it. The same applies to other quangos, once they have the money they appear to use it on that basis.
This Government plans to reduce the number of quangos by 45 at the same time as it has created 33 new ones. The objective was there but it seems to take a long time to achieve these things. We support the general tenor of what the Minister is trying to achieve in this Bill but I have some difficulty with the gaps in it. It will be very tempting for some future Minister to introduce even more regulations and make businesses, particularly small ones, much less competitive.

Aideen Hayden (Labour)
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I welcome the Minister to the House. I also welcome the Bill which, as the Minister pointed out, has three aspects, the merger of the National Consumer Agency and the Competition Authority; the regulation of the grocery goods sector and the media mergers and acquisitions section, which retains the basic model of the current legislation but is designed to ensure diversity of content and ownership of the media, which is important to a healthy democracy. There has been some criticism of various aspects of this legislation, for example, that we should not always pursue the merger of entities purely for the sake of it. Some aspects of that merger have been criticised on the basis that the Competition Authority and the National Consumer Agency are successful bodies in their own right and merging them does not necessarily bring about any improvement. Paul Gorecki from the Economic and Social Research Institute, ESRI, said that it would take time to bed down a new structure and for it to perform in an efficient and effective manner. The proposed savings of €170,000, which are small, were brought into question in respect of shared services, given that the Competition Authority already has some shared services.

Some other jurisdictions, such as Denmark, Finland and the UK, have merged competition with consumer protection. Sweden, Belgium and Austria, however, have not gone down this route. A regulatory impact analysis, RIA, was carried out for this Bill. It has been given support as a measure to enforce both competition and consumer law. The RIA determined that it would result in a more co-ordinated approach to the consumer and competition policy areas and enhance consumer welfare. That is what we all seek to achieve from any decisions we take. This Government committed to improving the regulatory framework and the Minister committed to vindicating and protecting consumer rights.

In respect of the grocery goods sector, there has not been uniform or widespread agreement on the new measures in the Bill.

It is important to recognise that the new measures in the Bill before the House have not been the subject of uniform or widespread agreement. Certain bodies, like Retail Ireland, have been supportive of it on the basis that it should lead to fairer practices in the food supply chain. The food and drinks industry has also supported the publication of the Bill. On the other hand, it has been criticised by certain financial commentators as a sell-out to the food industry and a step backwards in time into old-style protectionism. It is important that we keep any legislative measures under review. I have a particular interest in not allowing this country to go down some of the roads it went down in the past. Some aspects of this matter, such as the below-cost selling of fruit and vegetable products, have been highlighted and have come into the public domain.

It is important for this country, as a small open economy with a vital and vibrant food sector, to ensure Irish companies can get their products onto the shelves in a fair manner. If they cannot get a certain extent of trade, they cannot move into the export market. That is why the domestic market is so critical in a country of approximately 4.5 million consumers. We must always keep it to the forefront of our minds that it is not just about the initial producer of the good, or the ultimate consumer of the good - it is about the ultimate welfare of consumers, in the broader run, and the variety of goods and services available to them. We do not want a retail sector with a large number of multiples that list their products in countries other than Ireland. We do not want it to be the case that a good Irish product cannot get on the shelves. That is why I think we need to be cognisant of variety in our grocery sector as well.

I would like to speak about the media aspects of this legislation. The Bill goes some way towards assisting to ensure diversity of media in this country, but concern has been expressed about the possibility that it does not go far enough. It is pointed out in the Bills digest produced by the Oireachtas Library that the extent of the shareholding in media services in this country has been on a deteriorating trajectory. In other words, it has become more and more centralised in particular individuals and media groups. I emphasise again that Ireland is a small country with a small economy, in terms of our domestic market. It is important to bear in mind that the media in this country exerts a significant say in the political life of this country. We must be conscious that we have seen a great deal of centralisation of media in this country in recent times, particularly since the 1990s.

I presume it is never good for a Minister to lose part of his or her portfolio, but I think it is good that responsibility for the media is being given to the Department of Communications, Energy and Natural Resources. We have to think outside the box in terms of what constitutes communications now. Increasingly, traditional media is under severe pressure. More and more influence is being brought to bear by the Internet and social media. When we look at media issues like media ownership and control of media, it is important to be cognisant that large areas of social media and the Internet are controlled by the traditional media that have moved into this area. We have to be aware that the traditional media are exerting an influence on social media and on Internet communications.

This is a positive Bill. Despite the criticisms I have mentioned, I believe it will move us in the right direction in terms of competition and consumer protection. The Title of the Bill - the Competition and Consumer Protection Bill 2014 - is very apt. We need to be conscious that all and any legislation we deal with must be kept open to review in light of the developments we face on a daily basis.

Sean Barrett (Independent)
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I welcome the Minister. It is a fair while since we first discussed competition policies when we would get together in economic gatherings, etc.

Terry Leyden (Fianna Fail)
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The Senator has five minutes. I am sure he will be able to fit as much into five minutes as many speakers could fit into eight minutes.

Sean Barrett (Independent)
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I thank the Chair for that compliment. I presume I am doing it in competition with other speakers. Competition depends on new entrants and start-ups and on ease of entry and exit. We depend on the incumbents not to collude. In general, I think of the incumbents as the potentially evil people in the "victimless crime" that was referred to by the Minister at the outset. I note Dr. Vincent Power's view that the power of the Minister for Jobs, Enterprise and Innovation to take court cases in relation to possible breaches of competition law has never been used. Perhaps that is a power we should continue to look at and perhaps invoke from time to time.
We need new entrants. Some of the Minister's colleagues at the Cabinet table do not believe in new entrants, or in competition, in at least two spheres. I refer firstly to the draconian laws against competition in the taxi industry which were introduced by the new deputy leader of the Labour Party. The legislation in question had to be amended seriously here. The decision to discriminate against new entrants on behalf of the incumbents was made at the behest of the taxi lobby, which occupies the regulator's buildings. We have serious cases of regulatory capture in Ireland. It is one of the features of the economy. The other area I would like to mention in this context is health insurance. We have seen yet another example of this today. The Minister appoints the board of the Health Insurance Authority and the board of the VHI. The market is regulated in the interests of the incumbent and not in the interests of the consumer. We need to have checks and balances against that.
I was interested to read section 19 of the Bill, which makes provision for co-operation between the new commission and certain prescribed bodies. It is important that the Central Bank is included in the list because we did not have proper regulation of banks in the past and we are now building a cartel or duopoly of two banks. The inclusion in the list of the Commission for Aviation Regulation reminds me that the former Minister, Noel Dempsey, intervened massively to push up the cost of airport charges against the wishes of the regulator. The Commission for Energy Regulation, which sanctioned a 55% increase in the public service obligation levy on every energy user in the country without any evaluation - I think the closing date was last Friday - is also included in the list, as are the Office of the Financial Services Ombudsman, the Food Safety Authority and the Health Insurance Authority. The list also includes the National Transport Authority, which has put just 10% of bus routes up for competition. Given that we have been doing this since 1931, it will take another 90 years to open the bus market to competition. Many of the suspects are listed here. We need a strong competition policy against them. The way the Irish "private sector" works involves getting regulatory control over Government Departments and agencies. As Senator Quinn has pointed out, they never act in the interests of the consumer.
I do not believe we have a problem in the grocery sector. I think it is one of the most competitive sectors one will find anywhere. There is a certain irony in a public sector that imposes huge costs on the rest of the economy saying it thinks the grocery business is not competitive. I do not know what it means by that. It is estimated in the UK that since the post-war period, the percentage of the family budget accounted for by the household food bill has decreased from 30% to 9%. I am sure the same thing has happened here as a result of the presence of Aldi, Lidl and farmers' markets. It is an easy business to enter and people do enter it.
The same thing applies to the media. The media landscape in Tralee was dominated 20 or 30 years ago by The Kerrymanand by the Examiner group coming in from Cork. Now there are new newspapers in the town, such as Kerry's Eye, and there is Radio Kerry. I think the media sector is highly competitive. There is something strange to me about the bureaucracy bringing in laws against highly competitive sectors of the economy on the basis that they are not competitive, while ignoring all the damage done by the various regulators that have mentioned by me and by the Minister in the legislation.

The best example we have had of competition delivering benefits has to be in the deregulation of aviation. It happened by the new entrant negotiating a 40% discount from the suppliers of aircraft. He negotiated deals for lower charges at airports. He eliminated the travel agents altogether because they were looking for 9% and sometimes 17%. A market is dynamic. It annoys people but it delivers benefits to consumers. Bread does not appear because a bunch of philanthropists got together and said, "Let's make some bread." It appears because the blowtorch of competition brings it to our shops every day. There is too much emphasis on the media and on groceries in the Bill - as far as I can see they are highly competitive sectors - and too little on the State monopolies, the sheltered sector services, which have held back this economy for many years.

I am disappointed that according to what Senator Hayden cited, there appeared to be either no saving from the amalgamation of the two agencies because one of them was in Cork and had to be brought back or it is €170,000 which is minuscule out of the total consumer expenditure in this country. I note that the other mergers the Minister announced at lunchtime today will deliver productivity increases. Those are in the industrial relations area and I commend the Minister on that. We need to deliver benefits that people can actually measure from these mergers.

Catherine Noone (Fine Gael)
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I ask the Senator to conclude as he is about a minute over his time.

Sean Barrett (Independent)
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Senator Quinn mentioned some of the ridiculous advertising campaigns which were a waste of public money. He mentioned the advice to shop around. The other one we all remember was the man on the top deck of a bus with a strong Dublin accent saying he did not know what a tracker mortgage was. He must have been either working in a bank or working for the Financial Regulator; they were the people who did not know what a tracker mortgage was. The consumers knew darn well, and the banks and the Financial Regulator bankrupted that sector. That kind of silly advice from State agencies for how consumers should behave is a waste of money and I hope it will be controlled in future.

I have run out of time and I thank the Acting Chairman.

Catherine Noone (Fine Gael)
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The Senator is nearly two minutes over.

Imelda Henry (Fine Gael)
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I welcome the Minister and I welcome the Bill. Having a single functioning body responsible for competition and consumer protection is vital. I join Senator Quinn in congratulating the Government on reducing the number of quangos. It is important that we can amalgamate certain organisations that can go under the one umbrella.

The retail business is very important in this country and it is suffering greatly of late. It is very difficult for smaller retail businesses to compete with bigger retailers. While Senator Barrett mentioned that the grocery sector is very competitive and it is important to be price conscious, the situation is almost impossible for small grocery shops. We are well aware of the number of shops that have closed because they simply cannot compete with the bigger names.

It is also very important to have regulation when it comes to awarding contracts to suppliers and that contracts are adhered to. I wish to raise a particular hobbyhorse of mine which relates to the sale of alcohol. A statutory code on the sale of alcohol was not adhered to and we now have a serious problem with alcohol abuse because of the availability and price of alcohol. I know the Government has a plan to deal with this issue. I just wish it would happen a bit sooner. I hope minimum pricing, the segregation of the sale of alcohol in supermarkets and, in particular, a ban on print media advertising of cheap alcohol happens very soon. I hope that in the autumn something will be done to address the serious problem of the sale of cheap alcohol.

I welcome that the CCPC will have the power to publish a list of relevant grocery goods undertakings that have been found guilty of contravening the regulations and in particular that they will be named and shamed. The Bill is about regulating certain practices, which I very much welcome.

Kathryn Reilly (Sinn Fein)
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I welcome the Minister to the House. This legislation provides for the merger of the National Consumer Agency and the Competition Authority into a single body to be known as the competition and consumer protection commission. These are two important agencies. It also provides for regulation of certain practices in the grocery sector and amends the law regarding media merges by implementing the recommendations of the 2008 special advisory group on media mergers report.

I will keep my comments brief and touch on one or two issues. Many of the things I was going to mention have been mentioned earlier and there is no point in labouring them. Section 17 of the Bill prescribes those organisations which the new body will work with. It does not mention Irish Water. Water charges are one of the biggest consumer issues facing people at this time and although we have repeatedly raised this matter in the Dáil with the Minister, this has not been taken into consideration.

The Government has established a new governance model to manage, fund and deliver water services which will be carried entirely by the consumer. This new governance structure includes Bord Gáis, Uisce Éireann, the Financial Regulator and the Department of the Environment, Community and Local Government. We are concerned that there may be a critical omission here. Who will independently represent the consumer’s voice in this water reform process? Can the Minister give consumers confidence that they will have full recourse within the new structure? Will the provisions and the functions of the Consumer Protection Act 2007 now follow through for citizens in the context of Irish Water? Will their interests and welfare be protected?

When Sinn Féin Deputies raised the need for strong consumer oversight with the Minister for the Environment, Community and Local Government in the context of protecting consumers he stated that the Commission for Energy Regulation as the independent regulator of Irish Water has the powers to direct Irish Water to prepare a code of practice on any matter that the CER considers necessary and appropriate to secure the interests of the customers of Irish Water. The CER has the power to direct Irish Water to comply with a code of practice prepared in accordance with the legislation. The CER may consult with Irish Water, the public or any other person it considers appropriate.

The National Consumer Agency participated in the consultation on the establishment of a water services utility during 2012 and submitted proposals to his Department which were considered in detail. While that is all fine, the Commission for Energy Regulation is a regulator and not a consumer watchdog with real teeth to protect and vindicate consumers' rights.

I wish to speak about resourcing the CCPC. The Minister has said savings of €170,000 per annum will be achieved from the merger of the National Consumer Agency and the Competition Authority. The legislation will give additional powers to the new commission resulting in a range of new powers for the investigation of serious competition offences. While additional staff were allocated to the Competition Authority to back up improved enforcement powers in 2012, it would not be acceptable for the Minister not to further resource this new beefed-up body, be it within the organisation itself or through the criminal justice system. Taking on cartels on paper is not good enough. The system needs to have the manpower to make use of these enhanced powers. Resourcing accompanied with organisational training and development should be part and parcel of a proposal such as this.

I had intended raising the grocery sector and media mergers, but they have been mentioned already and I want to give other Senators and the Minister time to respond.

Michael Mullins (Fine Gael)
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I welcome the Minister to the House and I compliment him on introducing this significant legislation. In his tenure to date in the Department he has shown himself to be a reforming Minister. In bringing forward this legislation he is implementing a commitment in the programme for Government to reform State agencies and to merge those suitable for merging. This will no doubt result in a better use of scarce resources and give better value for money to the consumer and the taxpayer. As the Minister mentioned, there will be savings of approximately €170,000 per annum as a result of this merger.

One of the purposes of the Bill is to strengthen the enforcement of competition law by enhancing the powers of the CCPC. There is obviously a very strong link between consumer rights and healthy competition.

The Bill will regulate many sectors and bring fairness, which is what consumers want. We all want consumers to get the best possible deal. The Bill attempts to achieve a balance whereby the livelihood of primary producers is also taken into account. We are all aware of some practices within the multiples that are totally unfair. We saw vegetables sold recently at between 6 cent and 8 cent a kilo. No doubt the producers were forced to sell their product to the supermarket at unsustainable prices at the risk of losing their contracts.

One issue the new legislation does not address but which I hope the Government will sort out and bring forward measures to address – Senator Henry also referred to it - is the practice of large supermarkets using alcohol as a device to attract customers by selling alcohol below cost or very cheaply. They recoup the losses by increasing the price of basic foodstuffs. We are all very much aware of the serious issues we have in this country with alcohol. We must examine the role of the large multiples in that regard and the lack of controls that are currently in place.

A recent report from the Health Research Board indicated that 150,000 people in this country are dependent drinkers and that 1.3 million are harmful drinkers, according to World Health Organization standards. A total of 75% of all alcohol consumed is part of a binge drinking session with 21% of binge drinkers drinking at least once a week. We all know the availability of cheap alcohol is a significant contributor to the abuse of alcohol, which is devastating young lives and families and costing the health service close to €1.2 billion per annum. The sale of cheap alcohol is also impacting on other businesses. We all know the difficulties experienced by rural pubs and small grocery stores and small supermarkets. A friend recently told me he decided not to renew his wine licence because he could buy it in a multiple in a neighbouring town at a price less than he could buy it from his supplier. There was no logic to the situation from his point of view.

In welcoming the legislation I also welcome the fact that some issues that are not included are being considered by the Government. I refer to the provision of allowing for collective bargaining by professional bodies and groups of self-employed persons. That is a particularly significant development. I also welcome the provision relating to payment for goods within 30 days. The Bill clearly sets out that the regulations may specify the manner and timeframe in which payment for grocery goods supplied to relevant grocery goods undertakings are to be made. To allow for more flexibility, the timeframe for payment should be considered in the context of regulations rather than primary legislation.

I compliment the Minister on bringing forward the legislation. I hope what we will see as a result is greater but fairer competition within all sectors of business in this country and that the consumer will have greater protection as a result of the passing of the legislation. I am pleased to support the Bill.

Paul Bradford (Independent)
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I welcome the Minister and thank him for presenting the legislation. We have been awaiting the Bill for some time. Apparently, there was much debate in Cabinet on it between Ministers. We will have a greater opportunity to tease out the matter more fully on Committee Stage. I will not pose the question of whom we shall be teasing out matters with on Committee Stage. The Minister will keep his head down and will not respond to the issue. However, I welcome the fact that he has brought the Bill to the House today.
In the brief time available I strongly welcome the first two components of the Bill. It will be good for competition and consumers and therefore should be good for the country and the economy. It is typical of the studious work the Minister has undertaken in recent years and I congratulate him on that. However, I urge the Minister to reflect on the Part of the legislation dealing with media ownership. It is only on Committee Stage that we will have an opportunity to go into this crucial aspect in more detail. It might surprise some colleagues to note that Ireland has the most concentrated media ownership in the entire OECD. That is a matter that should be of concern to us. One could ask how appropriate that is. We are all aware of the dominant single player on the national media stage which has 40% ownership of the daily and Sunday newspaper market.
When the older political scholars in this House and in the other House recall the politics of olden times, from a media perspective they will refer to the great political debates between the Irish Independentschool of politics and the Irish Pressschool of politics between the 1920s and the 1940s where both media outlets presented a rather black and white view of the world. In one sense it was not a dangerous presentation because everyone knew which party the Irish Independent then supported and which party the Irish Presssupported. It was not in any way a form of hidden propaganda. We must be much more careful with new media. We must be concerned about putting sufficiently strong legislation in place to deal with media mergers. We must pose the question of whether it is good for one player to become dominant in a relatively short time, not just for the media and competition reasons but for the citizens of this State.
Everything about public life should be open to debate, analysis and counter-opinions. One person’s strong argument should be equally challenged by someone else. That makes for good, healthy debate, good democracy and good government. We are creeping slowly to a media situation where one strong voice will dictate. To varying extents, the Minister and I are victims of a single newspaper headline in 1997, which for better or worse literally decided the result on the day of a general election. The headline in question was “It’s Payback Time.” That was admittedly 17 years ago but it shows the power of one headline and what it could do. Arising from that we had Mr. Ahern rather than Mr. Bruton and we had the Celtic tiger rather than something more modest. Today’s economic crisis resulted from that piece of political theatre. I do not want the same thing to happen again. I do not want to see a headline in two years’ time, four years’ time or ten years’ time that is representative of a singular, dominant media person or group which can dictate and dominate politics and public life.

Mary White (Fianna Fail)
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The media love that.

Paul Bradford (Independent)
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That is very welcome but it does not butter my bread. On Committee Stage we must pose the question of whether the legislation is sufficiently strong to ensure we will not arrive at a situation where public life can be led by certain opinion formers?

I look forward to having that broader debate with the Minister on Committee Stage because it could be the subject of complex legislation.

Ivana Bacik (Independent)
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The Minister is very welcome to the House. Like my colleagues on this side of the House, I very much welcome the Bill. In fact, I believe colleagues on both sides will welcome it. It is a sensible Bill. As the Minister said, it has three main purposes. The first of those is the one on which there has been a focus, that is, merging the National Consumer Agency and the Competition Authority to create the new merged body which will take on the functions of the previous bodies, will be accountable to the Oireachtas and to the Minister for Jobs, Enterprise and Innovation, and which is being created as part of the rationalisation plan for State agencies. The Minister has pointed out that the creation of the new Competition and Consumer Protection Commission, CCPC, which does not quite roll off the tongue yet but I am sure it will eventually, will achieve significant savings. I note also that the Minister today secured Government approval for a further Bill in similar vein, that is, the workplace relations Bill, which will replace the current five workplace relations bodies with two in the same way seeking to deliver savings.

In terms of these mergers, it is not just about the savings. That is probably less important. It is more about seeking to create a more efficient and effective structure, in this case for the protection of consumer rights and, in the case of the workplace relations bodies, to ensure protection for employees in the workplace in particular. I very much welcome that part of this broader reform agenda.

The second purpose for which this Bill is being introduced is to regulate certain practices in the grocery goods sector. Other Senators, particularly Senator Quinn, have focused on that aspect of the Bill.

The third key purpose is to update and modernise the law on media mergers to take account of international best practice and technological developments and to implement some of the recommendations of the 2008 report of the Advisory Group on Media Mergers. Like my colleague, Senator Hayden, I very much welcome the transfer of the functions the Minister has described from his Ministry to the Minister for Communications, Energy and Natural Resources in that regard, that is, to change the relevant Minister for public interest considerations from the Minister for Jobs, Enterprise and Innovation to the Minister for Communications, Energy and Natural Resources. That seems a much better home for that aspect of the regulation of the media. I agree with other Senators who made points about the need to ensure regulation of media mergers and to protect against overly concentrated ownership of media in the hands of particular individuals.

I want to focus on the new criminal powers which have been provided for in the Bill. I welcome the Minister's commitment to ensuring white collar crime will be taken seriously. He pointed out that crimes under competition law, like many white collar crimes, are often viewed as victimless crime but they are far from victimless. Every citizen becomes a victim where, for example, serious competition offences such as cartels or price fixing impact upon consumers in terms of higher prices. I welcome, therefore, that we will be seeing increased and enhanced enforcement powers as part of the merger of the National Consumer Agency and the Competition Authority.

To be fair, the Competition Authority has in its own work generated a change of culture where competition crime has been taken more seriously and has been seen as a more serious breach of our criminal code. It is some years since an expert group looking at company law offences commented that in the case of company and corporate crime, the footsteps of the enforcer are rarely heard on the beat in Ireland. That report led to the setting up of the Office of the Director of Corporate Enforcement, ODCE, and to the much more serious work on enforcing Companies Act crimes. I very much welcome the same commitment being given on competition crimes.

Some of the new powers included that are hugely significant are the powers of authorised officers set out in section 37 in regard to investigations to include powers of search and seizure, the requiring of information, and the power to apply to the court for an order to require people to produce documents, answer questions and so on. Those are central provisions of the Bill which I welcome. I note the Bill also extends some provisions of the Criminal Justice Act 2011 to competition offences. It is welcome to see the provisions of that legislation being extended in that way.

I note also that new offences are being created to facilitate the work of the new commission. Section 18 includes an offence not to co-operate with the new commission in a variety of ways, a serious offence that will be punishable on indictment by a fine of up to €250,000 or five years imprisonment. I welcome a commitment in the Bill to tackling white collar crime. Also, the offence of obstructing or impeding of commission staff in section 35 is welcome.

I want to ask about the provision in section 89 which extends the provisions of the Communications (Retention of Data) Act 2011 to serious competition offences. Referring to that aspect of the Bill the Minister said that the implications of the recent European Court of Justice, ECJ, ruling on the relevant EU directive on data retention and our Act in general are being examined. Is it envisaged that amendments will be put to this Bill, because we will run out of time if the aim is to have this Bill dealt with in the Seanad before the end of the session, or will separate legislation be brought forward to amend the Communications (Retention of Data) Act 2011, given that the implications of the ECJ ruling are broader?

Richard Bruton (Dublin North Central, Fine Gael)
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I thank the Senators for their contributions to the debate which dealt with virtually every aspect of the Bill. Senator Hayden asked the fundamental question whether the whole will be greater than the sum of the parts and questioned whether the merger of these two bodies was a good idea. There is diverse practice across the European Union but I am firmly of the belief that it is a good idea. They both deal with market oversight, and the markets are becoming more complicated in many ways, with a move to trading online. There is a sharp distinction between barriers to entry, dominance and collusion versus fair practice, which the National Consumer Agency oversees. Those boundaries are beginning to blur. The pragmatism of the National Consumer Agency needs to be brought into the legalistic approach of the Competition Authority, and the merger of those two bodies gives a different perspective on the market. The same market is being viewed through different prisms with the aim of protecting the consumer, having freedom to establish in the marketplace but also to have fair practices and standards. Bringing those two together delivers gains. We will have the strong enforcement powers, the legal backup and economic analysis that has been traditional in the Competition Authority but also the feet on the ground, good consumer connections of the National Consumer Agency. I believe that merger will be beneficial and will result in more pragmatic responses to challenges that arise. That is the fundamental first section.

There was not much consensus on the grocery trade area. With his background Senator Quinn brings to the debate the suspicions of some retailers as to whether this is all about Government adding regulatory burden. I do not believe so. As I said in my opening statement, this has come from at least two studies of the grocery trade by the Oireachtas committees and a belief that unfair practices are going on where smaller suppliers seeking to deal with very large supermarkets are in a David and Goliath situation and custom and practice has grown up whereby unreasonable demands are put on small suppliers in the context of special promotions or so-called hello money, which as the Senator pointed out has already been banned. Practices have grown up in that sector, whether it be changes in forecasts or abrupt changes in conditions that have given rise to concerns. It is not just in Ireland that those concerns have emerged. They are in the United Kingdom also. Much of the model has derived from the UK approach where they have also seen the need to have fair trading rules in respect of the grocery sector. Across Europe there are different views. The Senator advocates the voluntarist approach attempted, and I do not know with what success, in France.

We tried very hard, in the time of my predecessor when Mary Coughlan was Minister, when John Travers was appointed to bring the sides together to seek a voluntary agreement but there was no sign of any such voluntary agreement emerging. The hope that there a meeting of minds of the two sides evaporated some time ago.

Clearly there was a commitment in the programme for Government, reflecting a concern in the Oireachtas from all parties, on the need to put in place the power to have written conditions that they would not be changed at short notice, that there would be a requirement on large retailers to have compliance officers, that the commission would have the power to issue compliance notices and take action off its own bat or on foot of evidence if it considered unfair practices were occurring. That debate had raged. While Senator Feargal Quinn offered one side of it, other Senators have indicated the difficulties small suppliers face in getting access and the need to have some assurance of fair treatment.

Senator Sean D. Barrett said there are no competitive problems in the grocery sector and that it is easy to enter. It may be easy to set up a shop - corner grocers are easy to set up - but the issue is whether the supply chain is fair and if that corner grocer would get a fair shake in access from large-scale wholesalers or whether they are facing unfair conditions. We have sought to be fair-minded in ensuring that the supply chain between the small retailer and the supplier or between the small supplier and the large retailer are being encompassed here. I look forward to the debate on this issue.

Both Senator and Senator Quinn had a go at the National Consumer Agency promoting the idea that one should shop around. I do not agree with either Senator. I think this is core to their business. I do not know whether Senators read any of its reports and whether they show, for example, the difference between the cost of getting a will written by legal representatives in different parts of the country and, indeed, in the same neighbourhood. There are huge gaps of four and five times the cost, depending on who one goes to. The same applies in terms of their financial comparisons, when comparing insurance products or different products across different providers. The message it gets out, not just to shop around but underpinning that with surveys of comparative prices is a real public service.

Sadly, people in Ireland do not switch. Switching is a very infrequent practice here. We are used to staying with the same accountant, the same bank and so on. We need a better informed consumer. The agency has sought always to draw attention to the very valuable information contained in its surveys which does not get enough coverage in the media. I am not a big fan of just advertising but encouraging people to look at alternatives is part of what we need to do, particularly when many people are under pressure and need to get the best deal. If we can make it easy for them to find the best deal that is an advantage.

Many people, including Senator Mary White, asked when is media ownership too large and said we have not answered that question in the Bill. Speaking as an economist, there is no neat definition of when any market is too concentrated because the first issue is to define what market one is talking about. One could say that the market for restaurants in the North Strand is very concentrated as there is only one of them. Everybody knows that one can go from the North Strand to Fairview where one can find another half dozen. One has to decide what market one is talking about. That element of judgment will always come into play in comparing, particularly in the media case, where we have not only print media, broadcast media, social media and umpteen different sources. A balanced judgment has to be made, having consulted through the broadcasting authority with various interests, that one does not stick rigidly to some view that once one hits 41% one is in the red zone, whereas if one is at 39% one is in the green zone. I do not think that is the way it works. Senators are seeking for something unreasonable to be inserted in the legislation as we would be bound into definitions that would not be sustainable in a changing market.

Senator Paul Bradford raises the bigger issue of growing media ownership. I do not know what he is inferring. Clearly, the line has been taken that we seek to regulate media mergers. We do not seek to regulate the organic growth of an individual business but where that business seeks to take over other players and thereby create a bigger market share - that is where we are seeking to regulate such mergers - not just in the narrow competition sense, which we have always done, but in the broad public interest which we have done in the past through my Department. We will do it now in a broader way through the Department of Communications, Energy and Natural Resources. That is the approach we have taken. Where one business grows and becomes stronger than others, that has not triggered any action in Irish law unless it abuses its dominance. When it becomes a dominant player a different set of rules and expectations are automatically imposed on it and the Competition Authority oversees these. If a big player is dominant and proceeds to take action to wipe out some other small player, then the authority will take action.

We have not sought to regulate ownership in itself, in other words, breaking up companies. That would be a much bigger debate and would be tricky territory to get into. I would be interested to debate this issue on Committee Stage. We are implementing faithfully the approach adopted by the advisory group and adding in the general welcome from the Seanad of giving this to the Minister for Communications, Energy and Natural Resources because of the diversity involved. There is no longer a narrow market place of newspaper media. It is a multi-dimensional communications issue where the Minister's Department and those agencies supporting him have a much better knowledge than mine. It is therefore appropriate that it would move to that Department.

Senator Mary White raised other issues as did Senator Sean D. Barrett as to whether there are problems with State services. It is perhaps good public policy that the price of cigarettes and alcohol is growing faster here than in other nations. That reflects public policy decisions. In examining State prices, one has to distinguish public policy decisions such as, for example, the decision to charge the economic price to those who are using hospital services as private patients. That is a policy decision as opposed to an anti-competitive practice. In looking at public prices, one needs to look beneath them and see what is going on. Of course, there are problems in the regulatory area. We have developed a regulatory system that needs, as Senator Barrett said, to be more attentive to competition and how competitive we are compared to other countries and also to consumer interests. That is one of the issues raised in the recent public policy statement from Government on the role of regulators. One of the directions clearly signalled is that a greater focus is required on the overall international competitiveness of the sector rather than looking at it in its narrow domestic context.

Senator Barrett referred to public service obligations as an indicator of protectionism. One can look at these in different ways. Clearly, if we want to promote renewable energy sources, which may not be immediately competitive in the marketplace but in the long term for other public policy reasons we want to see renewables in our grid, one has to create opportunities for doing so.

That is from where measures such as the PSOs and the re-fit prices have come. There can be good policy reasons for doing that.

In all of this debate, competition is not the only prism through which we view public policy. Senator White raised that issue, asking why the State should not be required to act on every Competition Authority recommendation. We have a rule that within nine months one must respond but we do not have a rule that one must act on it. For example, in a matter that is dear to many Senators' hearts, there would be a different view between the Competition Authority on sizes of retail outlets. Many want to see diversity and town centres thrive whereas, if one took a narrow competition view of the issue, one might ask why not have large out-of-town stores that are more competitive and charge lower prices. Sometimes public policy is looking at issues other than purely the competition perspective, and that is correct. As Ministers, we must take a broader view. The Competition Authority or, as it will be, the commission, is an important voice to hear, but it is not the only voice. By bringing the consumer end more clearly into the picture, one will get a better, more rounded view. Of course, every piece of legislation now goes to those authorities where it bears on their remit and they get a chance to influence it at the time it is being formed.

Senators Imelda Henry and Michael Mullins raised the issue of alcohol in the context of price. This has been a matter of debate and it was an issue in the other House where some Deputies wanted to see a reversion to the old groceries order where the invoice price of any trader would become the floor price, for example, if one sets an invoice price on one's invoice, then no retailer could go below that. I am totally opposed to that. That is not the right way to go. Effectively, that is what we used to call, as Senator Barrett will remember, resale price maintenance. It was a significant anti-competitive tool. If one could tell a retailer that one could not sell any cheaper than price X, it was a way of guaranteeing one's price. It was a complete denial of competition and it militated against the consumer. I do not support any reversion to that. In the context of alcohol, there is a specific case which is being viewed not only on narrow competition grounds, but on public health policy grounds, that the availability of cheap alcohol has got out of hand and we need to do something about it. That will come in but not in the context of competition law because it is not about competition but about protecting people from the abuse of alcohol. I recognise there is a much wider range of issues there that will come into play but they do not have a place in this Bill and they will be developed separately.

Senator Reilly said there was no mention of agreements with Irish Water. I understand the provision for those are in the Irish Water legislation, and there can be agreements. Our authorities do take an interest. The intervention by the National Consumer Agency in respect of some of the practices of the refuse collectors in Dublin was timely and important because some of the contracts being used by refuse collectors were unfair to consumers. Having agreements and being in the position to hammer out agreements with agencies to ensure that fair treatment goes into the contract will remain an important issue for the commission in the future.

Late payments, as Senator Michael Mullins stated, is not being provided for. It will be in the regulations rather than provided for in primary legislation because that would not be correct.

The issue of bargaining by professionals has come up on a number of occasions. The Competition Authority, based on European competition law, is clear that if one is an undertaking and one seeks to agree a single price, that is collusion. That is not allowed by an undertaking. It is a different position from a worker who is seeking to negotiate as a worker in an employment who is obviously allowed to negotiate price. An important line is being drawn between the ability of the State to consult with professionals, but it is the Minister, not the professionals, who sets the price. That is an important line that is drawn not only in Irish competition law, but in European competition law. It is one line that is important to uphold and it is being done here.

Senator Barrett asked about the number of staff. On paper, there are 60 staff in the consumer agency but it is certainly not up to that level. Senator Reilly raised the issue of manpower to accompany the new powers. We are putting the manpower in place and additional staff are being recruited to enforce the Bill.

The Communications (Retention of Data) Act 2011 is the policy of the Minister for Justice and Equality, Deputy Fitzgerald, and amendments to that Act will fall to her. I will not try to come up with something in the next couple of weeks.

I think I have covered most of the issues that were raised. I look forward to Committee Stage when we can get under the bonnet of the Bill and see how we can drive it along.

Catherine Noone (Fine Gael)
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When is it proposed to take Committee Stage?

Ivana Bacik (Independent)
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Next Thursday.