Friday 16 November 2018

Grinch minister shrugs off retail pleas

NIAMH HORAN

Tanaiste Mary Coughlan has shrugged off claims from Christmas shoppers flocking to the North that it is the Government's responsibility to entice them back to their local shops.

Minister for Enterprise, Trade and Employment Mary Coughlan gave a curt response to Irish shoppers who believe the onus is on the Government to put a stop to the mass exodus of bargain hunters travelling across the Border.

When informed that shoppers on the ground are looking to the Government to take responsibility for the retail crisis, the Tanaiste laughed, saying: "I don't own a shop. The Government doesn't own a shop. It's up to Tesco, it's up to Superquinn, it's up to Aldi, it's up to Lidl; it's up to them to cut their prices. They need to ensure that that happens; they have to do something about it."

The response comes as the deluge of shoppers crossing the Border for cheap food and Christmas gifts has become so intense that experts are predicting over £500m will be spent by Irish shoppers in the North this Christmas.

Although Ms Coughlan said she "appreciates" that retailers in the Republic have different costs to their northern counterparts, she emphasised that the obligation is on retailers to ensure the future of the Irish retail industry.

"I have been putting pressure on the grocery sector particularly, where there is no VAT North or South, that (they) have to provide value for money. And it's incumbent on those retailers to make sure we have and we continue to have a retail sector here."

The Tanaiste made the comments as calls continued for the Government to tackle the 6.5 percentage point difference between the rate of VAT in the Republic compared to Northern Ireland.

However, Ms Coughlan stressed that VAT is not the sole issue affecting products and insisted that retailers must provide value for money.

"There is no VAT on staple products," she said. "There is a price differential North and South and I have said to (retailers) that I cannot understand how you can have between 37.5 per cent and 47.5 per cent difference in a product North and south and that's why we're meeting the suppliers now as well as Retail Ireland to make sure that they provide value for money for their consumers and they're going to lose out if we don't do that."

She continued: "I think there is a realisation in the retail sector if they don't do something for themselves they won't be here and that's why you can now see 25 per cent off, 20 per cent off, in some of the shops."

The Tanaiste also urged "the media, consumers and the people of Ireland" to play their part in restoring the economy to its former glory.

When asked if she is worried when confronted with figures, such as the fact that one job is now lost in Ireland every three minutes, the minister responded by saying: "Yeah, but people like you will have to do something about it yourselves. You'll have to turn it around. The media, the consumers, the people of Ireland, we either let it go or we do something about it."

Meanwhile, Fine Gael spokesman for North/South co-operation, Deputy Joe McHugh, hit out at the response by the Minister that "the Government doesn't own a shop", saying it was "completely disingenuous".

"Customers will always look at price and the perception of the 6.5 per cent differential in VAT is too strong for people not to be sucked in that prices are cheaper in the North. So neither the Minister nor the Government can wash their hands.

From doom and gloom to jingle tills Analysis Pages 16,30,31,38

"They create the environment in relation to competition, in relation to costs, which have driven up the price for the last 15 years in the South."

Retail Ireland and Tesco Ireland responded to the Minister's comments by saying there is a "shared responsibility" between the Government and Irish retailers to entice Christmas shoppers back to the south.

Dermot Breen, director of corporate affairs at Tesco Ireland, said: "We have a shared interest in this -- in seeking to ensure that we have a viable retail industry and that we protect jobs and ensure that it supports the employment that it does.

"The retail industry employs about 250,000 people in Ireland, so it is in all our interests to support that. Every retailer competes very aggressively and seeks to provide the best value possible in the circumstances in which they have to operate. And that includes the cost environment, the cost of pay, the cost of services, the cost of utilities and so on."

Torlach Denihan, director of Retail Ireland, responded to the Minister's comments, saying: "We have a shared interest in addressing the current situation. The retail sector is a key part of the economy and it is under unprecedented pressure.

"We had a very good meeting with the Tanaiste. We wanted to share with her some of the experiences at the coal face in terms of how tough things are."

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