Billy Timmins (Wicklow, Fine Gael)
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Question 78: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her views on whether the impact of major retailers operating here who plan to change suppliers could have a detrimental effect on jobs here; if she has had contact with such retailers; and if she will make a statement on the matter. [19960/09]

Arthur Morgan (Louth, Sinn Fein)
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Question 127: To ask the Tánaiste and Minister for Enterprise, Trade and Employment if her attention has been drawn to the moves by a supermarket chain (details supplied) to reduce sales of Irish produced items; the effect this move will have on jobs here and market share; if she is in communication with this retailer; her views on moves to counter this move; and if she will make a statement on the matter. [20018/09]

Mary Coughlan (Donegal South West, Fianna Fail)
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I propose to take Questions Nos. 78 and 127 together.

I am aware of the concerns that have been expressed in relation to the possible impact of certain recent changes in the supply chain in the retail sector.

The changes essentially relate to the decision by the retailer concerned to alter the nature of its contracts with certain international suppliers. The retailer concerned has stated that it changed the manner in which it sources certain internationally branded products as international suppliers were treating its operations in this country significantly differently than they treated its operations in other jurisdictions such as the UK and that the direct consequence of these changes has been a significant reduction in its prices to consumers. The retailer has advised that notwithstanding the introduction of new internationally sourced products, it has retained its comprehensive range of familiar Irish products and brands. The retailer met with my officials and my colleague Minister Kelleher to outline the detail of the changes arising from the changes to its supply chain.

The relationships between suppliers and retailers and the contractual agreements entered into by them, as with any other parties entering contracts, is essentially a matter for the contracting parties themselves. It is clear that there are considerably different views as to the likely impact of the changes in sourcing arrangements implemented by the retailer concerned. Undoubtedly the relationships between suppliers and retailers are complex. The Deputies will be aware that I requested the Competition Authority to carry out a study of the retail import/distribution sector as to how competition is working in the sector and whether any practices or methods of competition are affecting the supply of goods and services in that sector. I received the Authority's report on the 30th April and I am examining its findings.

Undoubtedly in these difficult economic times, businesses and consumers are finding it more and more challenging to manage their expenditure and costs. For businesses, there is an imperative to reduce costs and streamline operations. This has been the reality for businesses in Ireland and elsewhere for some considerable time and has brought undoubted benefits to consumers in terms of lower prices for manufactured goods. Whilst the Government welcomes recent initiatives to reduce prices to consumers, it is mindful of the concerns that have been expressed in relation to the possible implications for employment in Ireland particularly if changes in supply chain arrangements reduce the level of purchases by retailers from Irish producers.

The future viability and success of the retail sector, including all its constituent parts, is vitally important to the national economy. It is essential, therefore, that the focus of all those in the sector, whether they be suppliers, manufacturers, distributors or retailers, is on ensuring that the sector delivers in terms of providing the best value for money for consumers whilst also minimising the negative impact of the current trading conditions on employment.