Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

First, I acknowledge the fact that prices are rising and rising rapidly in Ireland. For the first time in a long time we are seeing prices rise faster than incomes, but we think that will not be the case this year. Inflation will show down this year and we do expect to see not just nominal wage growth but real wage growth this year. To give one small example, the minimum wage increased by just over 7% in January. We expect inflation will be around 5% this year, so that is an increase in real terms. It would not have been the case last year but it will be this year. I think we will see that across the economy; as inflation moderates we will be back to real income growth again this year, which was the norm for almost every year in the past ten years, but not last year because of the impact of the global inflation crisis.

We have corresponded with the CCPC. I did so as Minister for Enterprise, Trade and Employment a few months ago, specifically on prices at the pumps and also prices in the supermarkets. It has powers in that regard. When it comes to price controls, we would be reluctant to do that. Legislation does exist that allows price controls to be imposed in certain circumstances by the Minister for Enterprise, Trade and Employment, but we do not have a good experience with price controls in this country, and around the world. We can control retail prices, but we cannot control wholesale prices, so we might be able to tell the small shop owner or the medium sized shop owner what they can sell groceries for, but we cannot control the price at which they buy them from the wholesaler.

The same applies to the price at the petrol pump. You can control the price at the petrol pump, but not the price at which the garage has to buy the petrol and diesel. That is why there is long-standing experience, both in our history as a country and in examples around the world, of supply problems, shortages and rationing where price controls have been imposed. We do not want to go down that road.

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