Bernard Durkan (Kildare North, Fine Gael)
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Question 137: To ask the Minister for Finance if he is satisfied that the strength of the Euro is adequately and accurately reflected in all trans-national transactions, both in the financial services and the commercial sector, having particular regard to the need to ensure that consumers and the economy here are not disadvantaged by restrictive practices applied here or abroad; and if he will make a statement on the matter. [21943/08]

Bernard Durkan (Kildare North, Fine Gael)
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Question 175: To ask the Minister for Finance if he directly or through the regulator has taken steps to ensure that Irish consumers in the financial services sector and outside receive the full benefit of the increased strength of the Euro; and if he will make a statement on the matter. [22284/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 137 and 175 together.

As the Deputy will be aware the general issue of the pricing of UK goods in Ireland on the basis of the increased strength of the euro has been the subject of recent discussions between my colleague the Tánaiste and Minister for Enterprise, Trade and Employment and the Chief Executive Officer of the National Consumer Agency. The main issue highlighted in that context was the importance for consumers to consider their options when it came to their weekly shopping basket and the Agency's engagement with Retail Ireland to discuss the delays in passing on the benefits accruing from the appreciation of the euro.

As far as the financial sector is concerned, international survey evidence indicates that the price and availability of financial services in Ireland, in general, compares favourably to other EU Member States. This reflects increased competitive pressures in the Irish market on account of, for example, new market entrants and initiatives such as the development of the Financial Regulator's consumer information role and the introduction of the bank switching code. Exchange rate changes would not, in any event, be expected to exert any particular significant influence on the cost of retail financial services in Ireland as compared to such factors as changes in official interest rates and funding costs for financial institutions in the current market environment.

In terms of the promotion of competition in the banking sector the Deputy may wish to note that significant progress has been made in implementing the recommendations contained in the Competition Authority's 2005 report to strengthen competition between financial institutions. The establishment of the Single Euro Payment Area (SEPA) in the EU is also designed to increase competition in the financial sector by eliminating barriers to cross-border payments which will facilitate consumers in opening and operating bank accounts in other EU Member States.

Consumer information and awareness has a very important role to play in boosting competitive pressures in the retail financial sector. The Financial Regulator encourages all consumers to shop around before purchasing any financial product and has developed a number of specific initiatives to help consumers to make informed choices in terms of their purchase of financial products. These initiatives have been developed through the framework of the Financial Regulator's "It's Your Money" campaign and have involved publishing consumer guides on credit products, fact sheets and cost surveys on personal loans, all of which are intended to assist borrowers in making the most appropriate credit decisions given their circumstances. This information is available through its publications, help-line and website. In view of the recent trends in exchange rates, it would of course be important for consumers to shop around for the best rates available for the purchase of foreign currency.

As regards exchange rate charges, relevant charges (which includes margins and spreads) in respect of Bureau de Change Businesses must be approved by the Financial Regulator under S149 or S149A of the Consumer Credit Act, 1995 (as amended). On an annual basis the Financial Regulator conducts a nationwide survey of foreign exchange charges being imposed by credit institutions and bureaux de change on consumers for retail foreign exchange transactions. The purpose of this is to confirm whether these providers of foreign exchange facilities imposed these charges in accordance with relevant legislation. In 2007, the Financial Regulator visited a total of 75 outlets of 10 foreign exchange providers (5 credit institutions and 5 bureaux de change). The survey focused primarily on the costs imposed by these financial service providers on consumers when converting euro denominations to Sterling, US Dollars, Polish Zloty and Czech Koruna and conversely when converting these currencies to Euro. Overall the findings showed a high level of compliance among foreign exchange providers. Where issues were identified, the Financial Regulator has followed up with the relevant institution to ensure these issues were addressed in an appropriate and timely manner.