Dual pricing system likely during transition to euro

 

MANDATORY dual pricing of goods and services in both pounds and the new euro currency is likely during a four year period spanning the introduction of the single currency, the Minister for Finance, Mr Quinn, said yesterday.

Speaking at the inception of the National Information Programme on EMU, Mr Quinn said the European Commission was investigating imposing mandatory dual pricing in order to protect consumers.

There was some implicit inflationary pressure in the transition to the new currency. Dual pricing would help expose efforts to increase prices during the changeover.

Mr Quinn said it was his opinion that dual pricing would be imposed for a period of around four years.

The euro is scheduled to come into being on January 1st, 1999. Euro notes and coins are due by January 2002, after which for six months both national currencies and the euro will be in use.

A small margin at each end of this 3.5 year period would account for the four years. £300,000 will be spent on the euro information campaign over the next year.

The programme is to concentrate initially on business and the EMU Business Awareness Campaign is to be run by Forfas.

The Minister for Enterprise and Employment, Mr Bruton, also speaking at the launch, urged companies to"act now" by putting someone in charge of investigating each company's needs in relation to the euro.

Companies would find that, through Forfas, there was an extensive network which would give advice and assistance.

Mr Bruton expressed concern about a recent finding by IBEC that only one in 20 Irish companies had begun to assess the impact EMU would have on their business.

Mr Bruton rejected reports that the transition would involve significant net costs for non banking businesses. "If you want to minimise the costs, appoint someone to oversee the transition now," he added.

Mr Quinn said he had "no doubt" that EMU would occur on January 1st, 1999, and that Ireland would be among the EU member states taking part.

However, IBEC, in presenting its euro information and awareness campaign, said a "degree of uncertainty remains".

Nevertheless the organisation was still advising companies to begin planning now on the basis that EMU will happen at the beginning of 1999, that Ireland will be in at the beginning, and that Britain most likely will not.

On dual pricing IBEC believes a "happy balance" should be found between ensuring customer confidence and "onerous and possibly confusing dual pricing requirements".