Rising consumer prices and fuel costs
Eamon Gilmore raised high prices at Irish branches of British retailers, rising food costs and diesel prices, seeking action for consumers, particularly people on fixed incomes. The Taoiseach said the National Consumer Agency and other relevant bodies would examine the issues, including pricing transparency and oil costs.
Given the Taoiseach's increasingly busy schedule, he probably does not get much time for pushing shopping trolleys around the supermarkets in Tullamore, but I want to raise with him the problem of rising prices. I will focus on two aspects in particular, the first of which is the rip-off of Irish consumers by British retailers with shops located in Ireland.
Last weekend, The Sunday Business Post carried a survey — one of a series published in recent times — which shows that the prices charged in the Irish branches of British retail outlets are up to 50% higher than those charged in their UK shops. The survey provided details in respect of a number of British retailers — Tesco, Marks & Spencer, Argos, Laura Ashley etc. — that have branches in Ireland. These higher prices are being charged despite the fact that the euro has strengthened against sterling. The euro is now worth 80p sterling. At one stage, it was valued below 60p sterling. In such circumstances, one would have expected that the prices charged in the Irish branches of British retail outlets would have fallen. Instead, they are much higher than those charged in the UK. For example, a leading brand of detergent costs the equivalent of €12.50 in a British branch of Tesco while it costs €18.89 in an Irish branch. In the case of Marks & Spencer, a pair of shoes priced at the equivalent of €44 at a British branch costs €55 euro at its Irish branches. The prices charged by Argos at its Irish branches in respect of electrical items are 20% higher than those it charges in the UK. What is happening in respect of this aspect of pricing is inexplicable.
The second matter to which I wish to draw the Taoiseach's attention — the position in this regard is also inexplicable — is the price of diesel.
Comment on this
Diesel used to cost less than petrol. However, the price of diesel is increasing each day. On my way to the Dáil, I noticed one petrol station at which diesel is priced at €1.39 per litre. No one can explain why the price of diesel has shot ahead of that of petrol or why it is continuing to rise. The only explanation appears to be that the oil companies, anticipating a shift by motorists to diesel cars and other diesel-powered vehicles as a result of environmental concerns, etc., are taking the opportunity to hike up the price.
Difficulties relating to pricing affect people on a daily basis. The National Consumer Agency was established a couple of years ago but it does not appear to be doing anything about these difficulties. What action does the Government intend to take to address the rise in prices, which is inexplicable and for which there is no justification? What does the Taoiseach intend to do to encourage the National Consumer Agency, which was established by the Oireachtas, to act more effectively in the interests of consumers?
Comment on this
It is the intention of the Tánaiste to discuss these matters with the chief executive of the National Consumer Agency in the course of this week.
Comment on this
Why do they not go shopping together in order that they might witness the rip off that is occurring?
Comment on this
It is intended to discuss these matters with the chief executive of the National Consumer Agency. The question of profiteering in respect of imports as a result of the difference in the currency exchange rate is a matter for the National Consumer Agency, the Competition Authority and the Department.
I am glad the rate of inflation decreased in the past month. However, it still stands at 4.3%. The basket of food items is an important factor in the computation of the consumer price index. I acknowledge that there has been an increase in food prices as a result of a number of international factors which are indicative of a change in the food security situation worldwide. Deputy Sherlock stated last week that the latter is an issue for consideration for debate in the House.
I take the point that the National Consumer Agency highlighted these matters in the first instance. It is the responsibility of the agency to protect consumer interests. The Tánaiste will pursue with the agency's chief executive the further policy issues that can be articulated or implemented to assist in resolving this matter.
Comment on this
That will not provide much comfort to the people obliged to pay these prices. I refer, in particular, to those on fixed incomes, such as pensioners, who are being affected by rising food prices. The price of a loaf of bread is 20% higher than it was at this time last year and the price of a litre of milk increased by 30% in the same period. Action is required in respect of this matter. It is not good enough to state that a discussion will take place between the Tánaiste and the chief executive of the National Consumer Agency in which they will bemoan what is happening.
In the past couple of years, the Government stood down the groceries order and stated that increased competition would lead to a reduction in prices. However, one of the biggest beneficiaries of the abolition of the groceries order, Tesco — the chief executive of which pays himself £10 million sterling per annum — is charging up to 50% more for goods in Ireland than it does at its UK branches. The National Consumer Agency may, as the Taoiseach stated, have highlighted some of what is happening. However, it does not appear to have taken direct action to protect consumers from the rip-off prices being charged by some retail outlets.
If the rip offs being visited upon consumers are not curtailed by the retailers responsible for them, the Government will be obliged to take action to remedy the situation. In light of the fact that the euro is strengthening against sterling, prices here should be falling and people should be reaping the benefits. Irish businesses that export their products are feeling the squeeze as a result of the change in the relationship between the euro and sterling. However, consumers are not enjoying the benefits of that change.
In certain shops, one can find items which are priced in sterling — I understand this practice is not legal — but the retailer will not allow one to purchase them in that currency. I met a shopper this morning who informed me that she requested to pay the sterling exchange rate for a particular item. However, the retailer insisted on charging her the higher euro price. This type of behaviour cannot be allowed to stand and people cannot continue to be ripped off in this way.
In his earlier reply, the Taoiseach failed to address my point in respect of the price of diesel. Why are motorists and hauliers obliged to pay so much more for diesel than used to be the case? What is happening in this regard? It appears the oil companies are engaged in some kind of cartel activity in order to hike up the price of diesel and rip off motorists and hauliers. The latter will have consequences down the line for jobs and businesses.
Comment on this
As already stated, the National Consumer Agency was established to deal with the type of complaints and issues — particularly those relating to consumers — to which the Deputy refers.
Comment on this
The agency possesses the competence to follow up on an individual issue to which the Deputy refers, quite apart from the general question which is also a matter of some concern.
The price of oil and diesel is a matter that must be addressed by the Department of Enterprise, Trade and Employment with the relevant agencies. There is a need to ensure that there is transparency as regards pricing arrangements. Oil prices have doubled in the past 12 months, from $62 to $126 per barrel. That sort of variation depends on the availability of oil and the stocks that are already in place. Without prior notice, I do not have details of the latter to hand this morning.
We have established agencies to deal effectively with these matters.
Comment on this
The relevant agencies are not dealing with them.
Comment on this
The Tánaiste has indicated she has already made arrangements to discuss the situation and their analysis of it with representatives of these agencies. Those discussions will also focus on identifying the action which can be taken and which might prove effective in respect of this matter.
Comment on this
Does that include the oil companies?