Dáil Éireann Debate, Tuesday - 6 December 2005
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Grocery Industry.
121 Mr. Gilmore asked the Minister for Enterprise, Trade and Employment his Department’s estimate of the savings which will be made on an average family’s weekly shopping bill arising from his decision to abolish the groceries order; the timetable of when this saving will be achieved; and if he will make a statement on the matter. [37881/05]
Amharc ar fhreagraMy Department's recent report on the groceries order did not estimate the precise extent of savings that will accrue to the average family's weekly shopping bill following the Government's decision to abolish the groceries order. What my Department has said in essence is that, since 1987, the price of the average weekly shopping basket has been maintained at an artificially high level directly as a result of the groceries order.
The precise extent of any such price reductions will, ultimately, be a function of a variety of factors including the amount of off-invoice discounts available for transfer back to the invoice, the actual level of net margin obtaining in the retail trade currently, and the extent to which resulting competitive forces will drive efficiencies at all levels of the production and distribution chain. Other extraneous factors, including input costs and consumer demand, also impact on retail prices and make it difficult to isolate the impact of any one factor such as the groceries order.
On the other hand, the Competition Authority has indicated that the order is directly costing the average household up to €481 per year. I hope, however, that the impact of the resulting competition in the market following the revocation of the order will bring about decreases in the retail prices of goods covered by the order, although it may take time for such savings to filter through to consumers.
