Irish Examiner view: Industry must make right call

Grocery prices

We have already seen a situation with staples such as milk and butter, until retailers were embarrassed into reducing the prices of such staples.

A special meeting today of Ireland’s Retail Forum will hear reports of price gouging within the supermarket industry.

The meeting has been convened specifically to discuss how wide-ranging measures can be adopted to reduce the cumulative cost of our national grocery basket.

With grocery inflation running at an estimated 16.3%, considerably ahead of the general inflation rate of around 10%, retailers, producers, and distributors have been asked to attend today’s meeting of the forum and explain why prices are not being reduced in line with general trends.

It is a sad reflection of our world that the word “greedflation” has come into existence to join the already established phrase “price gouging”.

But such things are a reality these days, and in a corporate world where the bottom line is the only one that matters, it is an unfortunate corollary that industries — even in the retail and service sectors — will cash in whenever possible.

At a time when a huge number of households are having to make visceral choices about how money is spent, it is unforgivable that massive profits are being made on the back of such unpalatable decisions.

And the other side of the coin is that the increased prices being asked of the consumer are not being passed on to the producers. We have already seen a situation with staples such as milk and butter, until retailers were embarrassed into reducing the prices of such staples.

Many farmers, who produce the basic ingredients for these products, did not see margins rise when prices went up and are now being asked to take a hit as prices fall. Meanwhile, the middleman sits pretty, juggling prices in their favour.

The Government does have an option to introduce price caps on necessities, but is giving the sector an opportunity to take the right decisions. The Government is correct in its assertion that it is right for the food industry to regulate itself.

Let us hope the industry sees it that way too.