PLATFORM:THE PAST four weeks have in many ways been a rebuke to those of us who believe in the effectiveness of markets.

The excessive leverage, imprudent lending and ignorance of risk that lies at the heart of the current financial crisis all point us towards a future of greater regulatory involvement in parts of our economy.

Yet while governments' actions have been critical in rescuing world markets from the brink, they must be careful not to intervene needlessly where regulation is superfluous or even harmful.

I was reminded of this two weeks ago in Brussels, where I was chairing a workshop of European retailers. Present at the meeting was Meglena Kuneva, the European commissioner for consumer affairs, and a number of other policymakers and consumer advocates. During the discussion, one of the participants suggested that it would be helpful to commission some surveys to discover what European consumers want.

There was something about that suggestion that struck me as odd, displaying as it did a detachment from the realities of the marketplace, and it prompted me to speak out.

I put it to the workshop that there was no need to commission surveys to discover what consumers want, because millions of businesses of every size and description across Europe are already doing that job, spending all day every day anticipating and meeting consumers' needs.

Too often, governments neglect this simple fact of business. As a retailer, I have spent all of my adult life obsessed with customer opinion. I have sweated and worried about decisions such as where best to place a new store and how to design it, what product lines should be introduced and how the shopping experience can be made more appealing.

Just as importantly, I have often had to be ruthless in discontinuing ideas that did not work. If the customer does not like an innovation or a new service, there is no place for it in the store.

Like anyone in business, retailers must be risk-takers in proposing new ideas, but they must also be entirely unsentimental if those ideas do not work out. The business community, and retailers in particular, have a massive incentive to know consumers' opinions, because our livelihoods depend on it.

Whenever I talk to consumer advocates, at national or European level, I am always struck by their enthusiasm and sincerity.

However, I am usually less impressed by their understanding of what drives a competitive business, and of the tireless focus on consumer needs that businesses bring to the market.

One example of political detachment from the realities of the marketplace is already in evidence in a proposed piece of European consumer legislation that will require all products sold in supermarkets to display the list of nutritional information half as large again as the typeface in a newspaper.

I encourage you to try to find enough space on the small jar of mustard in your cupboard for a complete list of nutritional information in letters that are 50 per cent larger than the newsprint you are reading now. There simply isn't room.

But this is just one example of the ill-thought out policies that often emerge from governments seeking to protect consumers.

Yes, abuses occasionally crop up in the market, and public policy - in particular competition and safety policy - must always act firmly against such abuses where they occur. But in competitive markets, inferior products or services fail because customers will desert the providers. Consumer advocates do not need to canvass opinion: European shoppers already mark their ballots on goods and services a billion times a day.

So is there a place for consumer policy at national or European level at all? I think there is, but this policy should be directed towards education and information to a far greater extent than it is at present. An example from the retail world is helpful in illustrating the importance of this public information aspect. A number of years ago, a supermarket chain in Britain experimented with reducing the salt levels in its bread. The experiment was a success and the low-sodium bread sold well.

However, a similar initiative in the Czech Republic was less successful. Consumers there disliked the new low-salt bread. There was even anecdotal evidence of people adding salt to the bread themselves, resulting in higher overall salt consumption than would have been the case if they had been eating bread made with the old recipe.

I think this shows that consumer protection initiatives, whether they come from business or government, will not work unless they are supported by an education and public information campaign. Ireland's smoking ban and plastic-bag tax have been largely successful because the groundwork had been laid by successful health and environmental campaigns.

In the vast majority of cases, the State's intervention on behalf of consumers is at its most useful when it acts indirectly, by first informing and presenting a case to the public, whose choices will then be expressed within the market. A Czech consumer, who was already convinced of the benefit of reducing their salt intake, would never have added salt to his or her bread.

Poor service or shoddy goods will perish of their own accord through consumer dissatisfaction. It is in the field of educating and informing that the Government's involvement with consumers is most useful, and it is to this end that all consumer policy - both inside and outside of government - must focus. In the absence of that educational work, consumer advocacy will achieve little.

Feargal Quinn is an independent member of Seanad Éireann and chairman of EuroCommerce