Groceries Order seems set for abolition

The Cabinet is to be asked to abolish the Groceries Order within the next four weeks, according to an informed source.

While the matter will not be raised by Minister for Enterprise, Trade and Employment Michaél Martin this week, it is likely to be considered next week or the week after.

A report drafted by Mr Martin's department, following consideration of more than 500 submissions on the topic, has come down in favour of the abolition of the measure.

The order prevents below-cost selling of many products but the review has come to the conclusion that it is anti-competitive, against consumer interests and has contributed to grocery prices.

The argument that its abolition would encourage the "ghost town Britain" phenomenon has also been considered and rejected.

The Government's Consumer Strategy Group recommended the order's abolition last May. The department's review has received more than 500 submissions, the bulk of them from organisations representing interested parties.

The possibility that the order might be abolished has also led to a rush of lobbying, with RGDATA, the independent retailers' group, being amongst the most vocal groups speaking out against change.

The report concludes that there is no economic justification for the retention of the order, and that consumers do not ultimately benefit.

Earlier this month Mr Martin held a series of private meetings with Superquinn, the Musgrave group and some of the other big opponents of change to the order.

Already under pressure from the Competition Authority and the National Consumer Agency to revoke the measure, the Minister heard the opposing view in six half-hour meetings with representatives of some of the State's biggest retailers.

In addition to Superquinn and Centra-SuperValu owner Musgraves, Mr Martin met Spar owner BWG, the grocers lobby RGDATA, the big business lobby Ibec and Food and Drink Ireland, the group that represents the food industry.

The opponents of change argue that its removal would ruin the fabric of small-town life by forcing the closure of corner shops as prices are driven lower by the biggest retailers.

The counter-argument suggests that consumers pay more for food than they should, with the Competition Authority saying in its submission to the Minister that the measure is costing households almost €500 a year in forgone savings.

While various figures are quoted in the departmental report that arose from the review, it does not itself put a cost to the consumer arising from the order.