Does the Taoiseach or any member of his Government have any appreciation of the impact of rising prices at the moment? Did the Taoiseach look at the CSO figures quoted in the Irish Examiner today, which show that food prices have increased by 16%? The article states that 37 of 50 items in the shopping basket have increased “substantially”. On top of that the Irish Independent quotes IBEC’s predictions for the future. It believes that shoppers are likely to be hit with massive increases for the cost of basic food and that bread, breakfast cereals, fruit juices and canned foods are set to rise in the coming months, with some items to increase by as much as 20%. Food has already increased by 16% and we have those projections for the future. We have had a 23% increase in gas prices and a 12% increase in ESB charges. Bus and rail fares, toll charges and domestic waste collection charges have increased. The European Central Bank has in effect promised that next month there will be another hike in interest rates.

Is the Taoiseach concerned about the recently concluded pay agreement, which gave a pay increase of 10% over 27 months, with the first phase being 3% and the second phase 2%, given the prices environment in which we are operating? Can he explain why both he and the Minister for Enterprise, Trade and Employment told us that after the striking down of the groceries order food prices would fall?

The Deputy's time has concluded.

When I heard the Minister, Deputy Martin, say that the prices of the shopping basket over the year would fall by somewhere between €500 and €1,000, I should have known that the opposite would have been the case. He is one of these Ministers who, so long as his tie is straight and the script is available from the spin-doctor, out he goes. Anything at all comes off the top of the head. The impact has been the opposite. Given the Taoiseach's income and that of the tired band on his front bench, does he have any appreciation of the impact of these increases on ordinary people——

The Deputy's time has concluded.

——on average industrial earnings? This spate of price increases has resulted in a 4.9% rate of inflation. Does the Taoiseach agree with those commentators who suggest that this month inflation could rise to as high as 6%?

Knowing Labour Members are 60-plus and rising, they are tired.

The Government does not understand what workers need to put up with.

Allow the Taoiseach to reply without interruption.

It is time for the Government to go.

60-plus Pat. You would not answer on Saturday.

There is the same absence of foliage on the top of the Minister's head and it has the same colour as anybody on these benches.

I request the Minister and Members of the Opposition to allow the Taoiseach to reply without interruption.

A rather tired group in the red band.

The socialists are 70s.

I ask the Minister to allow the Taoiseach to reply without interruption.

The Taoiseach is the socialist.

If I have a few moments silence I will answer Deputy Rabbitte. There has been an upward trend in inflation for the past four or five months and it could go up for at least another one. That is the projection of the CSO. I am not going to make a guesstimate on what that figure will be precisely. The second point is that under Towards 2016 we have revised the anti-inflation group, which did a very successful job in 2003, when it ran a campaign centred on controlling prices in 2003. The same model and arrangements that were used in that period are already in place. The group that is dealing with this, containing a cross-section of Departments and the social partners, has already had meetings with most of the groups involved, including the consumer prices section of the Competition Authority. It will meet the energy regulator next week and is pressing for a range of initiatives in areas with the support of the Government, which I believe will have an effect. I do not believe it will have a detrimental effect on the Towards 2016 agreement.

The inflation rate either for the calendar year 2006 or for the year to date is just over 4.1%. Half of the increase for the last year was in two areas — energy and various interest rate increases. The interest rate increases by the European Central Bank have had a knock-on effect and we will probably get another one in March. Markets have already discounted another 0.25% increase in March and perhaps even again later in 2007. If those increases are excluded, which is what the markets have been doing, it is 2.1%. So the inflation rate for the year has been 2.1%, excluding those two initiatives.

As Deputy Rabbitte knows the regulator has had a change of heart on the energy issues. Even though the Government had compensated those on welfare, there have been a number of decreases. That is good and they will take effect.

The groceries order was repealed a year ago, on 20 March 2006. Many of the increases now forecast are as a result of external influences as IBEC has pointed out. There have been a number of problems with fruit. The prices of fruit have gone up because of poor fruit harvests last year. There have been increases in international commodity prices, such as oil and wheat. There has been a large increase in the price of wheat, which obviously has been passed on. These are not factors within the control of the Government and have certainly nothing whatsoever to do with the removal of the groceries order. The impact of these factors on food costs underlines the importance of competition in the market place. I pointed out to Deputy Rabbitte yesterday, in reply to another question, that in certain areas the lack of competition has led to increases of8%. According to the most recent CSO figures the price of items previously covered by the order, the so-called groceries order goods, decreased by 0.5% in the month. Since April of last year, the first month following repeal of the order, the prices for goods that used to be covered by the groceries order are down 1.6%. Therefore, Deputy Rabbitte is factually incorrect. These items are at their cheapest since December.

According to Dublin City pensioners they have increased by 15%.

The Irish Examiner got it wrong again.

Not for the first time Deputy Rabbitte is shopping in the wrong shop.

The Taoiseach without interruption, please.

The House will accept that it is the CSO that decides these issues, not others. The items are down 1.6% and are at their cheapest level since December 2002.

That is positive thinking.

According to the Consumer Strategy Group report clothing prices decreased significantly in recent years. Items not previously covered by the groceries order declined by 0.1% in December but have, however, increased by 2.3% since removal of the order in March. These include mainly fresh meat, fish and vegetables where the real prices are historically more variable due to a less constant cost production. That is straight from the CSO.

That is comforting.

The combined groceries order and non-groceries order items declined by 0.1% in December and have declined by 0.3% since March.

That is massive.

The Taoiseach without interruption, please.

If one looks at some of the other increases that have caused difficulties in recent times one will see that car insurance is down 45%, which has had a huge impact.

It is not down.

It is a bit like electricity prices.

As I stated yesterday there are areas where the prices are up mainly due to lack of competition.

Who has been in government for the past ten years?

I do not know what the Taoiseach's diet is made up of but we run through the prices as before and after the groceries order. Beef is 10.2% higher, lamb 6.6% higher, pork 1.8% higher——

Rabbit down 0.8%.

That is only for income tax rates.

The Minister of State, Deputy Power, is going to join the Green Party.

That is one of the most imaginative things to emerge from that side of the House this year. Fish is 24% higher. I do not think the Taoiseach understands what is going on. He speaks about energy prices. A barrel of oil costs $52, the lowest price in 19 months. Anybody who has to go into the petrol forecourt will know that has happened. I know that the Taoiseach and none of the comedians beside him has had to go near a petrol forecourt for a long time so that they do not have any idea of the situation confronting the average taxpayer and the average citizen. How can the Taoiseach seek to deny the facts before his eyes in terms of the cost of living? Inflation, according to his own figures, is officially 4.9%. That Ireland is the most expensive country in the eurozone area is something the Taoiseach ought to know excludes some of the items he tried to include. I asked the Taoiseach what action he proposes to take on this issue. He said various meetings are lined up and that he will meet the regulator and so on. When answering a question in the House recently the Minister for Communications, Marine and Natural Resources, Deputy Noel Dempsey, made clear that he had no intention of changing the position where the regulator makes his decisions once a year.

That is right.

Is the Taoiseach saying that position has changed? Does he intend to take any action having regard to the fact that people have settled for pay increases of 3%, first phase, and 2%, second phase, while the reality is that the European Central Bank has promised to increase interest rates again in March?

The Deputy's time has concluded.

I ask the Taoiseach to deal with the reality of the figures from the CSO.

CSO figures are the figures we use so let us not try to use other figures. The CSO figures are the basket of figures we use for measuring inflation. I said at the outset that the figures were up for the past five or six months and that half of the increase, excluding energy and interest rates, 2.1%, is the rate of inflation. The price of the overall basket of food items has been very low. I gave the facts yesterday.

When did the Taoiseach last go to the supermarket and fill up?

Allow the Taoiseach to reply without interruption, please. Out of courtesy to her Leader, at least allow him to hear the answer.

It is 2.1%. The regulator has decided to do the same as the airlines and other groups have done. I am not sure if the Labour Party supplies Deputy Rabbitte's car but the Government supplies mine. When I was on holidays last August the price of petrol was €1.25 per litre whereas it is now 99c in competitive garages. That is a big decrease. The regulator has taken that into account as well. Yes, the barrel of oil has doubled in price but I hope the Deputy is not asking me to control the price of the barrel of oil on the international markets. The CIE group asked for a 10% increase but was given a 2.75% increase which is below the rate of inflation. There are difficulties in some areas. In the three items highlighted in the figures, wheat items, fruit and fish, there have been huge increases. I am not denying that. The overall price has been relatively low. I would not in any way denigrate the actions and the efforts made by the social partnership group who, three years ago, did a good job, with the backing of a campaign funded by the Government, and put pressure on the various interests to keep prices down. As I said yesterday, for IBEC and others there are areas where there is a lack of competition and with the assistance of competition in those areas we could get further increases. The end point is that inflation, excluding energy and interest rates on all of the food items which represents everything else is at 2.1% which is very favourable in international trends.

For raising the price of everything on the international market.