Seán Sherlock (Cork East, Labour)
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Question 47: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her views on proposals for a statutory imposed code of conduct governing the relationship between supermarkets and their suppliers; and if she will make a statement on the matter. [20180/09]

Mary Coughlan (Donegal South West, Fianna Fail)
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I am aware of the suggestions made in a number of quarters that a Code of Practice be introduced to regulate the relationships between the various elements in the retail chain.

These suggestions have arisen in the context of the wider debate in relation to prices and in particular the differential in prices between this jurisdiction and Northern Ireland and the UK.

Since the publication of the Forfás report on the Cost of Running Retail Operations in Ireland in December 2008, the focus of the debate in relation to grocery prices and the differential in prices between here and Northern Ireland and the UK has shifted to issues in relation to the cost of sourcing products and distribution/supply arrangements attaching to the supply of products.

Retailers have strongly contended that the cost of sourcing grocery goods products is much dearer in Ireland than the cost of sourcing such products in the UK and elsewhere.

On the other hand suppliers and distributors have contended that there is a significant imbalance in the relationship between retailers and suppliers, which is giving rise to suppliers being squeezed by the increasingly difficult demands being made by retailers.

It is disappointing that there should be such significant differences between the various elements within the retail chain as to the reasons for the current north south price differentials.

The Government, for its part, is concerned to ensure that we continue to have vibrant and successful food and retail sectors, given the important role these sectors play in the national economy. In this regard, the Government accepts the importance of ensuring that there is a balance in the relationship between the various players in the grocery goods sector, which takes account of the interests of all the various parties, including the interests of consumers. My Department, in cooperation with Minister Brendan Smith and Minister Trevor Sargent, is currently working on the details of a Code of Practice in this area which will have as its key objective the need to achieve a balance in the relationships between grocery goods undertakings, taking into account the need to enhance consumer welfare and the need to ensure that there is no impediment to the passing-on of lower prices to consumers.

It is my intention to seek the views of all stakeholders in relation to the details of the provisions of the Code, which I hope to publish for public consultation in the coming weeks. The Code in setting out the framework in which the different elements of the retail chain can enter into negotiations and agree contractual arrangements between themselves will help to ensure that those arrangements are balanced and fair and ultimately ensure that interests of all parties, including consumers, are respected.