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Dáil
‹ Ceisteanna—Questions. Oral Answers. - Price Control.

Price reductions and consumer monitoring

Summary

The Minister says competition, rather than direct price controls, has helped produce reductions in household goods following exchange-rate changes. Deputies question whether savings are being passed on, seek better monitoring and action on supermarket price differences, and call for funding for the Consumer Association of Ireland.

Seán Barrett Mr. S. Barrett Fine Gael

asked the Minister for Industry and Commerce the procedures he has put in place to monitor prices in respect of imported goods to ensure the passing on of benefits to consumers; and if he will make a statement on the matter.

27.

Comment on this

asked the Minister for Industry and Commerce if his attention has been drawn to the fact that price increases in a wide variety of commodities and services have escalated and are running out of control with subsequent effect on inflation and workers' earnings; to the fact that he has not used any of the mechanisms available to him to seek to restrain some recent upward movements in prices; his present proposals in this regard; and if he will make a statement on the matter.

41.

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asked the Minister for Industry and Commerce if he proposes to introduce price controls on those items where importers, distributors and shopkeepers are refusing to pass on reductions to customers; and if he will make provision for additional resources to be given to the Office of Fair Trade in this regard.

128.

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asked the Minister for Industry and Commerce, resulting from the advantage gained by the drop in the value of sterling, the steps he has taken to pass that advantage on to the consumer; the goods which have been reduced at wholesale and retail level; the amount of the reduction; the further steps he proposes to take in this area; and if he will make a statement on the matter.

Comment on this

I propose to take Priority Questions Nos. 26 and 27, Oral Question No. 41 and Written Question No. 128 together.

The House, I am confident, will be aware that I have been active in ensuring that recent favourable developments in the exchange rate between the Irish pound and sterling are reflected in lower prices for Irish consumers.

I would draw the particular attention of Deputies to a press release issued by the Government Information Services on 24 November 1989. That document indicated that I have been informed of a range of price reductions which have occurred because the Irish pound has been strengthening relative to sterling. A number of these changes have taken place very recently and others are expected in the near future. On the basis of this information, I am satisfied that there is at present no need for the introduction of statutory price controls. I am anxious to avoid that course, provided the thrust of normal competition in the market leads to price reductions for the consumer.

It should be remembered that the benefit of currency movements in 1989 should not be confined to imported food and household items only. I am anxious that goods such as footwear, clothing, vehicles, components etc. that are priced in sterling should also show appropriate reductions.

I have asked the Director of Consumer Affairs and Fair Trade to complete an investigation into the impact of the changing exchange rate on prices. The results of this study will enable me to assess whether the range and extent of reductions fairly reflect the favourable exchange rate movements taking place. I expect to have the results of this study in the near future.

Comment on this

Can the Minister of State tell us what steps he proposes to take to police the very wide differences in the price of commodities as between one supermarket and another? In particular I am referring to the major supermarket chains.

Comment on this

As the Deputy is aware, we have moved away from direct price control in this area and favour competition within the industry to bring about a reduction in prices. This policy has worked very well and I hope to have the report from the Director of Consumer Affairs in a few weeks time, the details of which I will give to the House. It is interesting to note that arising from Government action in this regard decreases have taken place in a wide variety of household goods ranging from 2 per cent to 9 per cent and in some particular items even more than that.

Comment on this
Seán Barrett Mr. S. Barrett Fine Gael

Would the Minister of State agree that his Department took absolutely no action until this matter was brought to his attention by this side of the House following a statement by Deputy Noonan, the Consumer Association of Ireland and me? The question I asked was quite specific. It asked would he please state what steps he has now taken to have in place a proper monitoring system to ensure what we have witnessed in the last few weeks will not recur and that we will not be dependent on Opposition Deputies to bring this matter to the attention of the Minister? There should be some automatic monitoring system in place. Can the Minister of State tell us what system is now in place, given that price control no longer exists?

Comment on this

The Deputy cannot expect to have it both ways. I have already explained to the House that we have moved away from the price control mechanisms which proved to be quite cumbersome and ineffective and which did not deliver price reductions in the way competition in the field has always done.

Comment on this
Seán Barrett Mr. S. Barrett Fine Gael

It has not worked.

Comment on this

Therefore, it is not possible to have it both ways. We have succeeded in recent weeks in getting a dramatic decrease. Let me tell the Deputy that the reason for this is the strength of the economy brought about by the Government.

Comment on this
Seán Treacy An Ceann Comhairle Independent

That disposes of questions for today.

Comment on this
Seán Barrett Mr. S. Barrett Fine Gael

The Minister of State should make some funding available to the Consumer Association of Ireland.

Comment on this