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The groceries order was repealed a year ago, on 20 March 2006.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.
