British stores accused of ripping off consumers

IRISH consumers are being fleeced by British chain stores whose prices here are almost 20% higher than they are in Britain, Fine Gael claimed yesterday.

The party carried out a survey of prices in five prominent retailers over the past week and found significant differences for British and Irish customers.

The results show a basket of five goods, randomly selected in Tesco in Ireland, was 43% dearer than in Britain, with one item a staggering 87% dearer.

It also claims customers of Habitat paid 25% more for a random selection of five goods in their Dublin store compared to British outlets. Argos customers, Fine Gael added, paid 18% more than their British counterparts. The prices for the other two stores, Marks & Spencer and Dixons, were roughly comparable, according to Fine Gael.

But the survey prompted a furious reaction from two of the retailers.

Tesco and Habitat accused Fine Gael of being selective and unfair in the goods chosen and of failing to take factors like VAT and transport costs into account.

The Consumer Association of Ireland said the Department of Enterprise should consider an order imposing dual pricing on goods in British multiples, to allow customers see what is being charged in Britain.

Fine Gael says it carried out the survey after its consumer website, rip-off.ie, received a large amount of emails complaining about the pricing policies of British multiples.

Fine Gael deputy leader Richard Bruton said the clear message was that Irish consumers were being ripped off by some British chain stores.

“If two of the participants in our survey can offer consumers the same prices as their British customers then the others should be able to follow suit.

Customers should vote with their feet and take their business elsewhere if this type of opportunistic price rip-off continues,” he said.

But in an angry response, Tesco Ireland said the survey was highly selective and dangerously misleading.

“To rely on five selected and unidentified food items from a selection of 25,000 in any store is highly unrepresentative and misleading,” the company said.

“We question why Fine Gael has not surveyed prices in all relevant food stores. Why not include Budgens stores in Britain and compare with SuperValu or Centra stores in Ireland (all owned by the Musgrave group)?”

Tesco said wage, transport, tax and supplier factors meant prices were about 10% higher in Ireland for all supermarket retailers. It argued that comparing prices with Britain did not amount to a level playing field. Tesco said its prices in Ireland were cheaper than those of Dunnes, SuperValu, Centra and Spar and similar to those of the German retailer, Lidl.

“The real comparison should be made between stores within Ireland, where the same costs, economic conditions and taxes apply,” it asserted.

Habitat said it was an Irish-owned franchise and not a branch of the British multiple.

It said not all price differences were detrimental to the consumer and many items were cheaper in its Dublin store.

Habitat said the VAT rate here was 21%, compared to 17.5% in Britain. It also said it buys stock many months in advance and the euro-sterling exchange rate was much less favourable when the stock was bought.

“Shipping across the Irish Sea is very expensive. [Habitat] can bring a container from Italy to Dublin for little more than it costs to ship stock from Britain,” the company said.

Argos was not in a position to respond yesterday, as the relevant manager was at a meeting and not contactable for comment.