Alan Healy: Irish consumers left in the dark over why food, fuel and energy prices keep rising

We deserve better transparency on why we pay what we pay

Grocery inflation is running at about 4.7%, and three out of four of us expect our household costs to rise again next year.

Irish households and businesses have been living with an ‘inflation crisis’ for half a decade now.

The price surges we witnessed emerging from covid, spurred on by the Russian invasion of Ukraine saw inflation peak at more than 9%. It has moderated significantly since then but we are still far removed from the goal of a 2% inflation target.

The rate hit 4% in October, with energy prices up more than 18% compared to a year ago. Grocery inflation is now running at about 4.7%, and three out of four of us expect our household costs to rise again next year.

These figures are not unique to Ireland. The war in Iran has pushed up oil and gas prices across Europe, and that feeds into almost everything we buy.

With Irish households facing amongst the highest energy costs in Europe, the squeeze is being felt everywhere. It is as if we are living in an era of high prices. But the constant increases have highlighted how exposed the Irish consumer is.

In other jurisdictions, consumers are equipped with more tools that allow them to make an informed choice and provide more transparency on why prices are what they are.

A simple bar of chocolate is a good example. In 2024, cocoa prices surged by 160%, and chocolate makers everywhere raised their prices. If the price wasn’t raised, then the sizes were shrunk. Sometimes both occurred at the same time. The price jump is reasonable given cocoa is the main ingredient and has more than doubled in price. But cocoa has since fallen by about 70% from its peak. So shoppers can be forgiven for being confused about why prices are not falling sharply. But there are explanations. Manufacturers buy cocoa months or even years in advance, and price relief may not arrive until late this year or early next.

It highlights that Irish consumers, at the very end of the supply chain, have a dearth of information on how the products they buy are priced and whether they are getting a raw deal through price gouging or are just the victim of global pricing.

Consumers in other countries are better equipped. In France, the Observatory on the Formation of Prices and Margins of Food Products tracks prices and margins at every link of the chain, from the farm to the processor to the shelf, covering a number of core, everyday foods. Every year it reports to the French parliament. Its latest report, published in July, found that processors and retailers absorbed the inflation shock of 2022 and 2023 and then rebuilt their margins, while the farmers’ share of the retail price fell. Spain runs a similar food chain observatory.

It does not mean French consumers necessarily enjoy cheaper prices, but they can at least see where the money goes.

France and Hungary also have measures targeting shrinkflation, requiring retailers to flag products that have shrunk when the price stayed the same.

The Irish consumer is also in the dark, compared to their international counterparts, when they go fill up at the pump. Yes, prices are clearly displayed on large boards at every filling station. But tracking which station has the best prices is tricky. A number of price monitoring websites and apps exist, but they rely on crowdsourcing with consumers submitting prices they paid.

Not so in the UK, where the competition authority found retail fuel margins had widened. So forecourts there must now notify the government every time they change their prices. The prices are available publicly so drivers can compare them in real time. Google Maps even embeds the prices on its app.

In Austria, petrol stations can only raise prices once a day, at noon, though they can cut them whenever they like. In Western Australia, stations must set the next day’s price by 2 pm and hold it for 24 hours.

This is not a story of Irish regulators asleep at the wheel. Our own consumer protection watchdog, the Competition and Consumer Protection Commission (CCPC), has been busy. It is currently pursuing Ticketmaster in the courts over pricing at last year’s Oasis concerts in Croke Park, and has taken enforcement action against a range of retailers for various infractions. The CCPC should be granted even greater powers.

The State has already accepted the principle that transparency matters in the food chain. The Agri-Food Regulator was set up in 2023 to protect farmers and smaller suppliers from unfair treatment by bigger buyers. From December 31, it will have the power to compel processors and large retailers to hand over data on prices and margins. It was designed to give farmers a clearer view but should also be extended to the end consumer.

Transparency on its own will not lower prices. But it sharpens competition, it gives regulators something to work with, and it treats Irish consumers as adults who can handle the numbers. If we must pay more, then we deserve to know why.