Richard O'Donoghue criticises Debenhams and calls for SME protection
Richard O'Donoghue spoke on the Protection of Employees Bill 2025 within the Solvency Bill, criticising Debenhams' use of UK sister companies and online channels to shift revenues and evade local accountability. He called for stronger protections for workers and SMEs, and for greater transparency in government procurement.
Debenhams and corporate structuring
Richard O'Donoghue outlined how Debenhams used a UK sister company and redirected online sales through that entity, producing accounts that made the local business appear to be in decline. He argued this practice left employees and the State with no accountability and warned similar tactics have been used by other firms.
Retail and creamery sector examples
He pointed to parallel patterns in other sectors, citing creamery operators and firms such as Dairy Gold that channelled transactions through online portals rather than local premises. That, he said, can understate the viability of local businesses and distort the economic picture for workers and suppliers.
SME protection and wage pressures
O'Donoghue pressed for policies that protect small and medium enterprises, saying SMEs are essential to the country despite contributing less than multinationals. He warned that raising minimum wages without addressing inflationary price increases simply raises costs for businesses without improving real purchasing power.
Government procurement and accountability
He criticised perceived double standards in public spending, relaying an example from a family resource centre about strict small-amount procurement rules alongside large capital projects with limited oversight. He urged the Government to lead by example and apply the same transparency standards to its own contracting as it expects of employers and employees.
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Thank you, Concordia. The Protection of Employees Bill 2025, a crucial piece of legislation in the Solvency Bill. Minister, we are going to start off by looking at Debenhams and how Debenhams managed to pull the wool over the Government's eyes here, pull the wool over their employees and leave this country with no accountability. They started doing their UK company, a sister company. They then started doing their online, so all their online was actually being imported into this country through a UK company which showed the books in Debenhams that it was dropping and dropping. That wasn't only done by Debenhams, that was actually done here by different companies across the country because if you looked at even at the creamery sector, and you look at the likes of Dairy Gold and other people that tried to downsize and close down the creameries, they went on putting their stuff, their farmers could book their stuff online. But if they went to their local creamery and they said I wanted 5 tonne or 10 tonne of fertiliser, they said that's grand, we'll book in that for you online. That did not go through the business in that area. It actually went through an online portal, which actually showed the books in that creamery to be less viable. But again, we need to make sure that that type of thing can't happen here. So we have seen it even in our own country, as well as what Debenhams has done, other major stakeholders in this country have done something similar. So if we are here to protect workers, we also need to make sure that if a person orders something online from here, and if they have a company locally that goes into their books in that local company, it does not show up in a sister company that will actually underestimate the company that's there. That's what we need to protect. And make sure that workers are protected. I was just in the Senate a few minutes ago, and Minister Pascal Dunhour was speaking, and something that I had brought to his attention when I first came here was protecting SMEs. An independent Ireland had been doing it since the very start. Protect SMEs. Now he said today, any person that employs somebody in an SME should be looked at. Yes, beneficially, they may not contribute as much as the multinational companies, but they are still wanted around this country to make sure that the whole country works in its entirety. It has taken for the last four or five years for you to actually see that. And why does independent Ireland have such a thing? Because I am an employer, I see it myself. I see other employees in the hospitality sector, where we have seen that they are trying to keep people going. But what you are seeing is legislation passed all the time, taxes changed, VAT rates changed. That only changes one thing. It changes the cost of opening the doors. It increases the wages costs, which is good, but the problem is the increase in wages doesn't go any further because everything you are buying has already been inflated. So the government need to look at the model that they are using. It is one thing increasing a minimum wage. It is one thing having an extra money in your pocket. But if it does not get you anything extra, it is not an increase, it is actually an inflation cost, which actually costs the companies to keep their doors open. But the only person that gets more out of the inflation part of it is government spending. And then we look at the watchdog over government spending, and we look outside the bike shed. I had somebody here, just a few minutes ago from the family resource centre. They said, Richard, if we spend 500 euros, we have to get three quotes. You can build a bike shed out here for 336,000 and it is wiped under the capital, there is no accountability. But for 500 euros, they have to get three quotes. It is not transparent. So if the government are leading with this, lead by example. If it is good enough for an employer and an employee, it has to be good enough for government to work within the same regulation.
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