Bruton tells Tesco to 'buy Irish' as retail giant creates 500 jobs
Published 25/06/2011 | 05:00
A SENIOR minister last night clashed with Tesco over its failure to buy more Irish produce after the supermarket giant announced more than 500 new jobs.
Enterprise Minister Richard Bruton accused the British company of squeezing small Irish producers as it unveiled plans to open a raft of new stores across the country. The minister, who is responsible for job creation, challenged Tesco to stop ignoring domestic producers.
Mr Bruton's latest intervention comes after he overcame opposition from Labour TDs to his plans to reform pay agreements for lower-paid workers.
He will bring his reform proposals to Cabinet on Tuesday in what is the first potential flashpoint between Fine Gael and Labour ministers.
Mr Bruton has indicated that he plans to change the system of premium pay for Sunday shifts in an attempt to drive business costs down. Employers have blamed the Sunday premium for the fact that 37pc of restaurants are closed on that day.
Yesterday, the minister told Tesco that Irish producers had driven their costs down. While praising the British retail giant for being a significant employer, he also said it should stock more Irish products.
"I'd like to see more and more of those on the shelves," said Mr Bruton. "When Tesco first came here, one of the key issues we set in terms of their investment was a need to drive Irish products, to see not only large producers but also small producers finding space on Irish shelves.
"I think perhaps focus was lost on small producers but now there is an opportunity for Tesco and others to recognise that a lot of Irish companies have brought down their costs."
However, Tesco Ireland CEO Tony Keohane failed to give the minister any guarantees.
He also admitted that the new Tesco stores could force the closure of small town-centre shops.
"There might be some churn, obviously, where we bring new competition. People have to react to that competition but that's the lifeblood of industry. That's what is needed in this country to spur investment, to spur creativity and bring new businesses to cluster around us in these new towns."
However, the independent retailers' organisation, RGDATA, last night reacted angrily to Mr Keohane's comments.
"I don't think the people who have lost their jobs should be considered 'churn'," its director general Tara Buckley said. "The net impact is a loss of jobs and those that are lost are much better than the jobs that are created in the new store."
The war of words erupted as Tesco Ireland announced phase two of a €120m investment that will result in the opening of 11 new stores.
It said 522 new jobs would be created at four new supermarkets and at seven smaller 'Express' stores.
Over the next 12 months, the chain will open new supermarkets in Cabra, Dublin; Kildare town; Rush, Co Dublin; and Roscrea, Co Tipperary, where an existing store is being replaced.
The seven 'Express' stores will be opened in Dublin and Kildare, but their locations have not yet been disclosed. Another 548 people will be employed during the construction process.
However, Mrs Buckley disputed Tesco's claims that it had created 14,500 Irish jobs.
"Jim Power, the economist, did a study for us and one of the things he showed was that for the 38pc of market share that independent retailers have they've created about 90,000, jobs. For the 27pc market share that Tesco has, it has created 13,000 jobs."
A spokesman for Tesco defended its job-creation policy.
He insisted the company was creating "careers that people want" with the opportunity to "develop nationally and internationally with Tesco".
The spokesman said nine of Tesco's 10 best-selling products were produced in Ireland and that over the last year the retailer had selected a number of small local producers to go in to its stores and had helped them develop their products to the extent that they were now exporting to the UK market.