Shoppers and struggling households risk being exploited by massive price hikes on foods, clothes and other everyday items due to the “inevitable” threat of price gouging after a no-deal Brexit.
Consumers Association of Ireland chief executive Dermott Jewell issued the warning and said the Government will be powerless to stop the price hikes because it is blocked from drawing up clear price control laws.
Mr Jewell said the fear of individual shops and stores hiking prices in the immediate aftermath of a no-deal Brexit has, until now, been a sideline issue.
However, with the likelihood of a worst-case scenario increasing, he warned it is “inevitable” some “opportunists” will take advantage of the situation — leaving shoppers and struggling households to literally pay the price.
“Like most consumers and businesses, until now we’ve put the risk of price gouging into the background. But in the absence of any level of price control whatsoever —and the Government can’t introduce any price control — that’s exactly what is going to happen.
“There’s no question, there will be opportunists among businesses and shops who will take advantage of the opportunity to increase prices because of a hard Brexit. There are going to be clear access problems for foods and other products, clear transport problems, and it is inevitable there will be single-digit and double-digit percentage price hikes because of what is going on.”
Unlike price fixing — which involves a number of businesses operating in the same area coming together to agree on an inflated price of a scarce item — price gouging is not strictly illegal in Ireland.
This is because it is generally conducted by individual shops or stores on an ad-hoc basis and not as part of any secret deals with other rivals.
While this means the concern over a surge in price gouging incidents can be mitigated by the fact it may not take place across all shops and stores selling the same goods, Mr Jewell said shoppers still risk being taken advantage of in a no-deal Brexit crisis.
The issue, he said, is added to by the fact that specific food and clothing items coming from Britain will be less available in a worst-case Brexit, leaving a gap in the market for “opportunists” to take advantage.
A Department of Business spokesperson said the Government is aware of concerns over potential price gouging by businesses and shops if a no-deal, hard Brexit arises.
The spokesperson acknowledged the risk could also be exacerbated by last week’s Central Bank warnings that the “potential” for a pound sterling crash and World Trade Organisation tariffs on British and Irish goods which “would of course impact on costs of imports”.
However, asked to clarify what protections, if any, the Government can offer consumers from price gouging risks, the spokesperson instead said the only protections in place are against widespread price fixing.