The Groceries Order should be strengthened, not abolished, according to an all-party Oireachtas committee report on supermarkets and consumers in Ireland.

The report said the Department of Enterprise, Trade and Employment should work with the Director of Consumer Affairs, the Competition Authority and representatives of suppliers, retailers and consumers in Ireland to see how the Groceries Order could be strengthened.

Introduced in 1987 and renewed last year, the order effectively puts a limit on the extent to which supermarkets can compete with each other and small retailers on price. It bans below-cost selling and prevents supermarkets undercutting smaller retailers.

The report recommends that an examination should be carried out by the Director of Consumer Affairs to see if any of the multiples operating in Ireland engage in regional pricing. The director should also be required to investigate the true cost of promotional and loyalty schemes operated by multiple retailers regarding hidden costs for consumers and suppliers.

Measures should be introduced to prevent the creation of local monopolies by multiple retailers, according to the report.

To recognise and encourage the services provided by local food shops serving communities in rural areas, a system of rates relief should be introduced for shops in communities of less than 3,000, it said.

The report also recommended that An Post be compelled to maintain and develop the existing network of post offices throughout the State.

The report was welcomed by Mr Pat Delaney, director of the Small Firms's Association.

"There had been some doubt last year whether the Groceries Order would be retained. We're happy it has been and this report further underpins the requirement. We believe the joint committee has a major role to play in ensuring that both the Director of Consumer Affairs and the Competition Authority are fully committed to the retention of the Groceries Order."