Richard Bruton (Dublin North Central, Fine Gael)
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Question 155: To ask the Tánaiste and Minister for Enterprise, Trade and Employment if her attention has been drawn to the fact that some British shops are charging a much higher price in the Republic of Ireland than in Northern Ireland for clothes items (details supplied) as well as groceries in view of the exchange rate; and if she will extend the remit of the Consumer Authority to publishing price comparisons in clothing and ensure that regular surveys are published. [44264/08]

Mary Coughlan (Donegal South West, Fianna Fail)
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I am aware of the concerns that have been expressed that a number of retailers may not be passing on to consumers the benefits of the Euro's recent appreciation in value, particularly against Sterling. Arising from these concerns, I initiated an engagement with the retail sector as to the reasons why the benefits of the Euro's appreciation were not being passed on to consumers. In the course of that engagement I met with IBEC and leading members of Retail Ireland, and also wrote to major individual retailers, to express the Government's concern on this matter.

I also discussed these concerns with the National Consumer Agency and requested them to undertake specific price surveys comparing prices in the Republic and Northern Ireland. Indeed the concerns in this area were if anything heightened by the cross Border survey of grocery prices undertaken by the Agency which showed that the price of branded products charged by retailers in the Republic were up to 31% greater than the price they charged for such products in Northern Ireland. In the case of own brand products the price differential was up to 17%. Whilst the Agency's cross Border survey was focused on food and grocery prices given their significance in terms of the average household budget, I understand that it is the Agency's intention to look at the possibility of including other areas of consumer goods in future surveys.

In so far as the response of the retail sector is concerned, retailers have advised that while the retail price of goods imported from the UK had lagged exchange rate movements due to factors such as the forward purchase of goods and currency, there had already been reductions in the price of some goods and further reductions were in the pipeline. Retailers also advised that one of the main reasons for the price differential was that the cost of doing business in Ireland was significantly higher than that in the UK. To that end, in September of this year I requested Forfás to carry out an analysis of the relative cost of doing business in a number of locations in the Republic, Northern Ireland and the UK. I intend to pursue this matter with the retail sector on receipt of Forfás' Report.

In so far as price trends between Ireland and the UK are concerned, the latest Central Statistics Office's bulletin for October shows that consumer prices continue to fall with overall annual inflation at 4.0% down from 4.3% in September. This compares with an annual rate of 4.2% for the UK all items retail prices index. Indeed on the basis of the EU comparison measure of the Harmonised Index of Consumer Prices, the annual rate of inflation in Ireland of 2.7% as at October 2008 is significantly less than both the annual inflation rates of 3.2% for the Euro 15 area and also the rate of 3.7% for the EU as a whole. The harmonised rate is also below the equivalent UK CPI index rate of 4.5%. In the area of food, the October CSO returns show that food prices in Ireland continue to fall with annual food inflation at 4.6% as compared with an annual UK food inflation rate of 10.1% as per the UK's Office of National Statistics. In the area of clothing and footwear, prices actually decreased in both Ireland and the UK in the year to October 2008 by as much as 6.8% in Ireland as compared with 6.7% in the UK.

Notwithstanding these welcome reductions in prices, it is my strong view that where there are significant differentials in consumer prices as demonstrated by the findings of the National Consumer Agency's cross Border survey, retailers have a duty to their customers and to the economies in which they operate to explain why there are such differentials. It is my intention to continue to engage with the retail sector on this matter.