Grocery trade proposals published

Tánaiste and Minister For Enterprise And Employment Mary Coughlan today published proposals to ensure fair play for consumers…

Tánaiste and Minister For Enterprise And Employment Mary Coughlan today published proposals to ensure fair play for consumers, suppliers and retailers in the grocery market.

The proposals include a ban on many types of secret payments by suppliers to retailers and the appointment of an ombudsman to arbitrate disputes within the trade.

The draft code of practice for "grocery goods undertakings" published today will be subject to a period of consultation running to the end of September.

Ms Coughlan said she was responding to significant public debate on grocery prices, north south price differentials and other developments in the grocery goods sector over recent months.

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The proposals are intended to address concerns raised about the relationships between players in the grocery sector and, in particular, those between suppliers and retailers.

"We have witnessed significant change in the Irish grocery goods sector over the past year, resulting in lower prices and better value for Irish consumers at home," the Tánaiste said.

"While this is a positive result, the Government also fully appreciates the need to ensure that, in this drive for better value, there is transparency and a balance in the relationships between the various players in the grocery goods sector."

The code would have as a key objective the need to achieve this balance between suppliers, producers, retailers and consumers.

Ms Coughlan said that she consulted closely with Minister For Agriculture Brendan Smith and Minister Of State For Food Trevor Sargent in preparing the consultation paper.

Stressing the importance of the agri-food sector to the country, she said the code of practice could provide a transparent framework for the sector.

"Any Code of Practice must also ensure that the interests of the consumer are at its core by prioritising the need to enhance consumer welfare and ensuring that there is no impediment to the passing-on of lower prices."

The consultation asks eight key questions, including: whether the code should be voluntary or statutory; how it can be enforced; whether a separate ombudsman's office should be established; whether there should be a threshold to limit its application; and what impact application of such a code may have on consumer choice and prices.

Ms Coughlan said relevant issues arising from the consultation would be taken into account in the new Consumer and Competition Bill, which is due for publication before the end of the year.

The Irish Small and Medium Enterprises Association and Irish Farmers Association welcomed the proposals today.

ISME chief executive Mark Fielding said, "this form of 'hello money' has become widespread, suppliers are under intense pressure to comply or else lose business. Today's announcement should assist in exposing this abuse".

IFA president Derek Deane said it was a "positive proposal" but warned that if the measures are to be effective, they would have to be enforced by a properly resourced ombudsman.

Submissions are invited before the deadline of Wednesday, September 30th.