Consumers' Association chief praises new price cuts by supermarket groups

The chief executive of the Consumers' Association of Ireland (CAI) yesterday welcomed the price cuts announced by major supermarkets…

The chief executive of the Consumers' Association of Ireland (CAI) yesterday welcomed the price cuts announced by major supermarkets.

Tesco reduced prices by an average of 12 per cent on 120 food and grocery items in its 76 stores. Reductions included branded goods such as Pampers, Huggies, Flahavan's and McVitie's as well as Tesco own brand items.

This is the fourth in a series of price cuts announced by Tesco since September. A spokesman said the company intended to introduce further price cuts over the coming year.

As with the previous reductions, Superquinn immediately matched the cuts in its 19 stores. Marketing director Mr Eamonn Quinn said the company's policy was "to constantly monitor our competitors' prices, and changes are implemented where gaps appear". Superquinn announced additional price cuts on a range of fresh food items, including round steak and pork chops.

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A spokesman for Supervalu said their stores would not be reacting to the cuts. It was a skirmish on a small number of fronts rather than a price war.

He said that on any one day Supervalu would have up to 200 items on promotion. Of the 120 reductions announced by Tesco, 18 were petfoods and a large number were UK-branded items, he pointed out. Dunnes Stores did not comment.

Mr Dermott Jewell, the chief executive of the CAI, said price surveys carried out by the CAI on behalf of the Office of the Director of Consumer Affairs (ODCA), between September and December last, had found little variation in the price of branded goods, so a shake-up of the market was badly needed.

The ODCA has referred the results of the surveys to the Competition Authority.

The average shopping basket has been getting dearer rather than cheaper despite the recent announcements. Consumers have been paying higher prices for lamb and pork since the foot-and-mouth crisis.

The Consumer Price Index for March showed food prices had increased with higher prices for lamb, pork and bacon, poultry, fresh vegetables, fresh fruit and soft drinks. The price of potatoes and breakfast cereals fell. Food rose by 6.5 per cent over the preceding 12 months while the price of drink rose by 4.9 per cent.

A survey by Checkout Magazine after the last wave of price cuts in January found that 59 per cent of 100 shoppers interviewed outside Tesco Ireland's Phibsboro Store were "blissfully unaware of the most recent price cuts, despite extensive media coverage and in-store publicity".

A recent report by the Oireachtas Committee on Enterprise and Small Business, "Supermarkets - giving consumers a fair deal", recommended an investigation into the possibility of strengthening the Grocery Price Order, which prohibits below-cost selling on certain items, as well as an investigation into whether multiple retailers in Ireland are practising regional pricing.