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Dáil Éireann debate -
Thursday, 16 Nov 1972

Vol. 263 No. 10

Ceisteanna—Questions Oral Answers. - Prices Surveillance.

55.

asked the Minister for Industry and Commerce if he will detail the items for which he has approved increases in prices since 1st April, 1972; and if he will indicate under separate headings the increases approved by him in respect of foodstuffs and household requirements for the same period.

Particulars of all price increases recommended to me are available from the published monthly reports of the National Prices Commission, which are in the Oireachtas Library and which are also circulated to each Deputy. On the day on which each monthly report of the commission was published, I indicated in a press statement that I had accepted the commission's recommendations for price increases for the firms concerned and that I would raise no objection to the implementation of these increases.

56.

asked the Minister for Industry and Commerce what provision exists for price surveillance at retail level other than that involved in the preparation of the consumer price index; the number of staff engaged in this work in Dublin and the rest of the country; and the reports, if any, made on the results of their studies.

The present arrangements for price surveillance at retail level are weekly surveys of prices of a range of food items in all centres throughout the country, and of compliance with the Retail Price (Food) Display Order, 1972. Investigation of complaints about excessive prices also constitutes a form of price surveillance.

The number of inspectorate staff at present engaged in this work, without distinction between Dublin and the rest of the country, is 80. Arrangements are being made to recruit further prices inspectors.

The results of the surveys which I have just mentioned will be published in the monthly reports of the National Prices Commission.

Will the Minister not consider giving weekly details instead of monthly reports?

Does the Deputy want me to sanction increases weekly rather than monthly?

I want the Minister to let the people know weekly what is being increased in price and not to be sweeping this knowledge under the carpet as he has been doing in the past and deceiving the people.

He is ashamed of the inflation.

The increases come monthly. Each month a number of increases are sanctioned and they are published at that time.

May I ask the Minister whether these 80 staff are employees of the National Prices Commission, of the Department of Industry and Commerce or of what body?

Of the Department of Industry and Commerce.

57.

asked the Minister for Industry and Commerce if he will indicate the action he proposes taking in the event of full price lists not being on display for the public; the number of complaints made to him in regard to absence of such lists; the machinery available to him to ensure that the public know the correct price of goods; and if he will make a statement on the matter.

58.

asked the Minister for Industry and Commerce if he is aware of reports that many shopkeepers throughout the country are not complying with the Retail Prices Display Order which came into effect on 1st July last; whether any prosecutions have been forthcoming in this regard; and the steps his Department intend taking to ensure that this order is fully complied with.

With the permission of the Ceann Comhairle, I propose to take Questions Nos. 57 and 58 together.

The Retail Price (Food) Display Order, 1972, made by me with effect from 1st July, 1972, requires retailers of certain goods to exhibit notices showing the prices charged.

Extensive publicity by way of press advertisements and other news media coverage, was given on two occasions —in July and October, 1972—to the making of this order and the necessity of complying with it. There are, at present 80 inspectors throughout the country checking on compliance with the order.

To date, 13 complaints have been received in my Department from members of the public about noncompliance by traders with the terms of the order.

Prosecutions will be instituted against traders who are failing to comply with the order.

59.

asked the Minister for Industry and Commerce whether any study has been carried out of the impact of the introduction of VAT upon retail and wholesale costs; and whether the total costs involved for retailers are likely to be offset by cost reductions arising from the improved liquidity situation of retailers and savings in wholesale tax payments by retailers on fittings, furnishings, etc.

The National Prices Commission have examined the impact of the introduction of value-added tax upon, inter alia, retail and wholesale costs. The Deputy will find the commission's views and conclusions at paragraphs 14 to 24 of their report for March, 1972. No expert study has been carried out in relation to the matter mentioned in the second part of the Deputy's question, but in view of the extension to two months of the period for tax payments, there should be a considerable improvement in the liquidity situation of retailers.

Could the Minister give any indication as to the relative balance between the improvement in their costs from the point of view of improved liquidity and the increase in costs deriving from the extra clerical work involved in VAT? Surely it is important that we should have some guidance as to whether the statements from retail organisations that VAT is putting up their costs and forcing up prices are valid or not? Does the Minister think they are valid?

I do not accept that they are valid.

Would the Minister state the evidence he has——

Just commonsense. I use it a bit.

Would the Minister explain how commonsense enables him to know the extent of the increase in administrative costs of a retailer in respect of VAT?

It depends on the size of the business. The benefit of being able to hold on to the tax collected for an extra period of one month can be quite sizeable.

Would the Minister not accept that the benefit is very little when one considers that it is a benefit which relates to the interest for one month on a sum of money which itself is a very small fraction of the turnover? It is a percentage of a percentage of a percentage. Would the Minister not agree that it is very small?

I accept that; but, against that, the amount which has to be spent by the retailer is considerably less than what it used be on turnover tax.

60.

asked the Minister for Industry and Commerce whether his Department has received complaints relating to price increases of foodstuffs occurring in advance of VAT introduction; and whether any method of counteracting untoward increases is under consideration.

Thirty-one complaints were received in my Department relating to increases in prices of foodstuffs prior to the introduction of value-added tax. These have been investigated and the results show that in the vast majority of cases the price increases were attributable to a changeover from shelf prices which were exclusive of turnover tax to shelf prices which were inclusive of turnover tax. In the few cases where excessive prices were being charged, the traders concerned reduced their prices to the correct level at the request of the inspectors. All complaints received about unwarranted price increases will be investigated by my Department.

There are at present 80 inspectors of my Department checking prices of a wide range of foodstuffs throughout the country.

Can the Minister state what legal action has been taken where excessive price increases have been discovered, other than asking the people concerned to end their exploitation? Have there been any prosecutions?

Except in relation to overcharging of two items—milk and bread—no prosecutions have taken place. If, arising out of VAT, the distributing trade have a mark-up which is basically unjustified, we have a team of inspectors who call on such people.

Can the Minister state if any legal action is open to him? If so, why does he not take it?

I can make orders under almost any subhead in relation to this matter.

But the Minister has not done this. Do I take it that he does not propose to use this power?

I did not say that. However, I am conscious of the fact that basically most retail distributors are anxious to carry out a fair, straightforward business——

99 per cent are like that.

I want these people to be encouraged to continue.

Perhaps greater encouragement could be given to these people if their colleagues who misbehave were dealt with. In this way the good name of the 99 per cent would be preserved.

We cannot debate this matter all afternoon. There are other questions.

61.

asked the Minister for Industry and Commerce the number of complaints his Department have received since the introduction of VAT; the number of complaints investigated; and the number of instances in which excessive prices were shown to have been charged.

Since the introduction of value-added tax on 1st November, 1972, 238 complaints have been received in my Department about overcharging as a result of the new tax.

All of these complaints will be investigated. Of about 50 complaints already investigated, there were only six instances of prices having been increased, as a result of VAT. In those cases, the prices were adjusted to the proper level at the request of an inspector from my Department.

62.

asked the Minister for Industry and Commerce whether he will provide financial aid to consumer associations willing to assist in the work of price surveillance.

I am anxious that price surveillance will be undertaken by consumer associations and I am considering at present the question of providing financial aid for such associations.

I am glad to see that at last a Fine Gael proposal is being adopted by the Government.

63.

asked the Minister for Industry and Commerce if, in view of the general public indignation at continued inflation and of the injustices involved, the Government will introduce an immediate statutory price freeze.

64.

asked the Minister for Industry and Commerce if he intends to take any action with regard to instituting a national price freeze, particularly on the price of foodstuffs; and, if not, why.

65.

asked the Minister for Industry and Commerce, if, following the decision of the British Government to bring in a mandatory price freeze, he will now introduce a similar price freeze in this country.

With your permission, a Cheann Comhairle, I propose to take Questions Nos. 63, 64 and 65 together.

The National Prices Commission have commented on the causes of inflation in many of their monthly reports, but they have made no recommendation to me that I should introduce a statutory price freeze. I do not, therefore, contemplate the introduction of a statutory price freeze at this juncture.

Orders fixing maximum retail prices are already in operation in respect of milk in Dublin, in Counties Donegal and Mayo and in Ballinasloe, drink in Dundalk and bread throughout the country.

Can the Minister tell the House when the price of sugar was increased? Can he explain if this has been the reason for a considerable increase in the cost of other foodstuffs in which sugar is used? Shopkeepers are being blamed for many of the increases in price whereas, in fact, the reason for the increases in VAT.

Is the Deputy saying that VAT is to be blamed for the increase in the price of sugar?

The price of sugar was increased before the introduction of VAT but it has been responsible for many increases in other foodstuffs.

I would welcome an advance question from the Deputy on this matter. There is no question of a manufacturer being allowed to charge any increase without getting prior sanction from the National Prices Commission. If, as a consequence of an increase in the price of sugar a manufacturer of any commodity in which sugar is used puts up the price he is acting wrongly and would be dealt with. However, I do not accept that this has happened.

In this case what is the manufacturer to do if the price of the raw material is increased?

The manufacturer should apply to the National Prices Commission. For instance, if the price of sugar was increased at the end of last month there is no reason why the price of the commodity in which sugar was used—for example, sweets—should be increased as a result of the rise in the price of sugar.

If the manufacturer cannot recoup the extra money spent on sugar he will have to suffer a loss.

Manufacturers know the position.

I am calling Question No. 66.

66.

asked the Minister for Industry and Commerce if he will make an order to provide that manufacturers publish all their sanctioned price increases in the national newspapers; and if he will deal with the matter urgently.

The monthly reports of the National Prices Commission, which are published and circulated to Deputies and to the Press, contain particulars of all price increases recommended to me by the commission in the previous month. In the accompanying Press release, I indicate if I have accepted the commission's recommendations on these price proposals. The commission's reports and recommendations are given wide publicity by the media.

In these circumstances it is not necessary that manufacturers should publish details of their approved price increases in the national newspapers; in fact, I have no powers under the Prices Acts to compel manufacturers to publish price increases in the Press.

In connection with the introduction of value-added tax, I have arranged to have all price increases recommended to me by the commission over a period of some months, and to which I have raised no objection, advertised in the daily Press.

67.

asked the Minister for Industry and Commerce if his attention has been drawn to a report (details supplied) of apparent profit margins ranging as high as 200 per cent on fruit and vegetables in Dublin; and if he will make a statement on the matter.

I have seen the report referred to by the Deputy. The National Prices Commission have arranged for a detailed investigation of the prices of fruit and vegetables in Dublin to be carried out under the direction of An Foras Taluntais. This investigation is proceeding and it is expected that the report will be available in the spring of 1973.

I think it preferable to await consideration by the National Prices Commission of the report on this investigation before deciding on any action in regard to profit margins on fruit and vegetables.

Can the Minister state if this report was undertaken as a result of the report in the Irish Independent regarding profit margins of up to 200 per cent on fruit and vegetables?

No, so far as I know the action had been taken previous to that by the National Prices Commission. I should like to point out it is not the Minister but the National Prices Commission who initiated this action. In their monthly report for August and September, the National Prices Commission stated that a detailed investigation of the prices of fruit and vegetables was proceeding then under the direction of Dr. O'Dwyer.

68.

asked the Minister for Industry and Commerce if he will indicate the movement of food prices in the last three months; and if he will make a statement on the matter.

Calculations from the latest official statistics show that in the three-months' period from mid-May to mid-August, 1972, food prices increased by 4.7 per cent.

There are many factors which cause increases in food prices: increased prices received by home producers; increased import prices and increased costs of wages, materials and overheads incurred by firms processing foodstuffs.

I have no power to control prices paid to producers of primary agricultural and horticultural products, as they are excluded from the scope of the Prices Acts, nor can I control import prices. Proposals for price increases by manufacturers and processors of foodstuffs are examined by the National Prices Commission who recommend increases only where they are justified by unavoidable increases in costs.

69.

asked the Minister for Industry and Commerce the number of written complaints his Department have received in the past six months with regard to rising prices.

Separate figures of complaints about rising prices, as distinct from complaints about alleged overcharging and excessive prices, are not available. In the past six months about 400 written complaints about prices have been received in my Department.

70.

asked the Minister for Industry and Commerce if his attention has been drawn to a newspaper report (details supplied) regarding the price increase on 50 items; and what action he proposes to take in the matter.

The October, 1972, monthly report of the National Prices Commission indicated that from 27th September, 1972, to 31st October, 1972, the Commission considered 51 notices of intention to raise prices. The commission recommended price increases in 50 of these cases. In a number of cases, the increases recommended were less than the increases proposed by the firms concerned.

In a Press release which I issued on 9th November, 1972, in conjunction with the publication of the commission's October report, I stated that I had accepted the commission's recommendations on the price proposals contained in that report.

71.

asked the Minister for Industry and Commerce if he will extend the terms of reference of the National Prices Commission to allow for mandatory recommendations with regard to retailers' profit margins.

The terms of reference of the National Prices Commission are adequate to enable them to make any recommendations they see fit to make about retailers' margins. I see no reason for taking the action suggested by the Deputy.

72.

asked the Minister for Industry and Commerce the number of items in respect of which price increases were granted for the period 1st January, 1972, to date; and the average price increase granted or recommended by the National Prices Commission.

From 1st January, 1972, to 31st October, 1972, I indicated, on the recommendation of the National Prices Commission, that I would raise no objection to price increases in 313 cases. Particulars of all price increases recommended to me are available from the published monthly reports of the National Prices Commission, which are in the Oireachtas Library and which are also circulated to each Deputy. On the day on which each monthly report of the commission was published, I indicated in a Press statement that I had accepted the commission's recommendations for price increases for the firms concerned and that I would raise no objection to the implementation of these increases.

Each of the 313 price increases in question may involve many individual items. An average figure for the amount of increase in the 313 cases is not readily available and in any event would not be a realistic one. The effort necessary to produce a figure would not be warranted.

For the reasons given in their report for January, 1972, the commission have not made any calculation of the average of the price increases recommended by them.

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