Government urged to reintroduce ban on below-cost selling

The Government should reintroduce its ban on below-cost selling to offset the “destructive impact” of food retailers on farm incomes, said IFA presidential candidate Jer Bergin.

He has called for a radical rethink of the retail sector’s proposed code of conduct legislation. He said agriculture must be at the centre of any Government initiative to stimulate economic growth and employment.

Mr Bergin said: “The growing cost/price squeeze and the incessant power of the major retailers are real barriers to viable farm incomes. The industry must look at the development of measures such as fixed and forward price models for inputs and outputs that would help to insulate farmers against the effects of global food price volatility.”

A suckler beef, tillage, and sheep farmer based in Ballacolla, Co Laois, Mr Bergin’s views on retail sector reform are shared by Fine Gael MEP Mairead McGuinness.

An EU committee chaired by Ms McGuinness is reviewing whether an EU-wide retail code should be mandatory. The retail sector wants to develop its own voluntary code.

Gary O’Donovan, managing director of O’Donovan’s Off-Licences in Cork is also calling for a ban on below-cost selling to be reintroduced. He said the tax reclaimed by retailers on losses incurred from this practice costs the exchequer €21m annually on alcohol alone.

Prior to the abolition of the Groceries Order in 2006, it was not possible to sell alcohol at below cost.

Mr Bergin’s push to limit the powers of retailers is part of the IFA presidential manifesto he unveiled while addressing members of Macra na Feirme in Adare, Co Limerick.

He called for a range of government-funded initiatives to support farmers in lifting income and delivering increased output targets under Food Harvest 2020.

“It is vital that the Government introduces a stimulus fund, using money from the National Pension Reserve Fund and the European Investment Bank. Supporting farmers in expanding income and output must be a central feature of this fund,” he said.

He said low-cost, long-term finance for farm expansion should be a key component of this fund. It should include instruments such as chattel mortgages where farmers would be able to borrow on the back of livestock, especially on leased land.

“With the right measures in place, the expansion targets set out in Food Harvest 2020 can be achieved, leading to an increase in farm incomes, food output, exports, and employment, especially in rural areas which have borne the biggest brunt of the economic downturn during the past five years,” he added.

He announced that support for young trained farmers would be a priority for him as IFA president. In this regard, he said an innovative installation package for young farmers must be introduced under the next rural development programme.