Friday 23 August 2019

Charlie Weston: 'We're 'Treasure Island' to big foreign retailers but locals left with bad taste'

Farmers also argue the likes of Tesco will not reveal the profit margins it makes here, unlike in the UK. Stock photo: REUTERS
Farmers also argue the likes of Tesco will not reveal the profit margins it makes here, unlike in the UK. Stock photo: REUTERS
Charlie Weston

Charlie Weston

When it comes to the cost of living, this country is a world-beater.

That has been confirmed by a new survey from the European Union's statistical agency, Eurostat.

We are the fourth most expensive for a basket of food and soft drinks, coming in at a cost a fifth higher than the average across the EU.

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That prices for everyday staples should be so high in a food-producing nation will strike many as odd.

There are a number reasons. Prices are high despite often cut-throat retail competition - the entry of the Germany discounters has helped suppress prices.

But Ireland is still Treasure Island for German and British retailers. Ironically, prices of food are lower in Germany and Britain than they are here.

We could do with more retail competition, but consumers also lose out due to the conflict between protecting the interests of food producers and those of the shopper.

Farmers, with their EU subsidies, would be quick to protest at any retailer they perceive to be selling their produce too cheaply.

This means that even though we produce enough food and drink to be able to export €12bn worth a year, it can be cheaper to buy a bag of spuds in Bolton than Balbriggan.

It is not quite the case that protecting the income of 138,000 farms is the sole reason consumers get gouged when they do their shopping.

But the operation of the Common Agricultural Policy, and its subsidies, does mean we pay more for food than might otherwise be the case.

And to be fair to farmers, this is an expensive country in general. The diesel they use has to be imported and wages are high as the farmhand is likely to see half his or her gross wages go to Revenue.

Farmers also argue the likes of Tesco will not reveal the profit margins it makes here, unlike in the UK.

This leads to suspicions this country is a goldmine for retailers.

Wins for retailers and farmers mean that the poor consumer ends up getting poor value.

Irish Independent

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