The order freezing the prices of a range of alcoholic drinks sold in pubs and hotels should be lifted as it has failed to halt inflation, the chief executive of the Licensed Vintners' Association has said.
Mr Frank Fell was reacting to figures, published on Tuesday, which show inflation to be running at 6.2 per cent for the 12 months to the end of July. This inflation rate is at the top end of economists' estimates.
Although Mr Tadg O'Sullivan, chief executive of the Vintners' Federation of Ireland, was unavailable for comment yesterday, he reacted critically to the order when it was signed by the Minister of State for Public Enterprise, Mr Tom Kitt, last month.
The order covers 16 items, the price of which publicans or hoteliers must display outside their premises. It was backdated to May 15th and is due to be lifted in October.
Mr Kitt said when signing the order it would be temporary and used to counter inflation. It is enforced by the Director of Consumer Affairs, Ms Carmel Foley.
"This price freeze was always a political move rather than a fiscal one," said Mr Fell yesterday. "It does not have any validity and was always going to be ineffective in tackling inflation. Of course, I am calling for it to be lifted."
Tuesday's figures showed that alcohol went up by 5.1 per cent in the 12 months to July this year, compared with 17.4 per cent for tobacco, 10.6 per cent for housing and 9 per cent for transport.
Since the price freeze, alcohol was found to have risen in price by 0.3 per cent. Mr Fell could offer no definitive explanation for the increase during a price freeze but suggested inflationary pressures might be coming from the "off-trade" or off-licences which were not subject to the order. Alternatively, the price of drinks such as brandy, which were exempted from the order, could be going up.
He said the LVA's economist would be studying figures at the Central Statistics Office to work out the cause of the alcohol inflation.
