Consumer rights body defends its own value

CONSUMER RIGHTS:IT'S A COLD AND unseasonably snowy morning in late March and the woman at the head of the body charged with protecting Irish consumers is talking cash. Specifically, she is insisting that the National Consumer Agency (NCA) offers excellent value for money to Irish taxpayers despite countless media reports over the last three years which have written it off as an ineffective quango which has achieved little more than provide jobs for the boys. And girls.

Ann Fitzgerald bristles at any suggestion that the agency, which was formed in 2007, has been a waste of money. “I know that certain sections of the media give out about us but we do try and provide the best value for money that we can,” she says.

She claims that the journalists who criticise the NCA need to reflect on the fact that it has a staff of 40 people, just half the number it was supposed to have when it was established. “People work really hard here and we have achieved a lot with very little,” she says. In particular she cites the NCA’s grocery price surveys which, she claims, have created a much higher awareness of the value of products.

Controversy never been far from the agency’s door however. It has been accused of weakness in addressing issues of real importance to consumers, such as over-pricing, the ongoing problems associated with euro-sterling price differentials and poor customer service and it rarely intervenes in disputes, much to the chagrin of consumers.

Then there’s Celia Larkin, a name which has dogged the NCA since she was appointed to its board in 2007 by her former partnerand now former taoiseach Bertie Ahern.

Last year Eddie Hobbs called on Larkin to resign from the board or work for nothing following reports that the then Irish Nationwide chief executive Michael Fingleton had personally authorised a fast-track loan of €40,000 from the building society to her. She stood her ground and hung on to her annual fee of €14,000.

While Fitzgerald is reluctant to criticise Larkin or any board members past or present, she does convey the distinct impression she really could do without the negative publicity such sideshows attract, particularly as the agency prepares to be amalgamated with the Competition Authority as part of a cost cutting programme announced in the 2009 Budget. “People should not look at the personalities on the board but the work we are doing, collectively,” she says.

Fitzgerald is more anxious to talk up the past successes of the NCA and its future plans. First up is the Economiser, an online tool designed to save money. It may sound like some class of vigilante consumer champion – Eddie Hobbs with guns, maybe? – but is just a website. It went live last week and is designed to help consumers make cost comparisons with people in a similar financial position to themselves. So, if you want to know how much more or less you’re spending on groceries, energy, mobile phones or TV and telecoms, than your peers, the site will tell you.

The NCA surveyed 2,000 people to create 59 profiles which users can compare themselves to. People are asked their age, number of dependents, gender, salary and grocery spend. They are also asked about how they shop; what percentage of it is planned, as opposed to spontaneous; whether or not they check the unit price of the products they are buying or if they are open to own-brand as opposed to branded products.

One of the first Economiser users was surprised to find that her monthly energy bill was 300 per cent more than the average. Investigation revealed that her boiler was broken and so she was able to knock over a €1,000 off her annual heating bill in a heart beat.

While it is unlikely that many of the people who use the site in the coming weeks - over 4,000 people had used it in up to last Friday - will be able to make such significant savings, the NCA estimates that people will be able to cut between 5 and 20 per cent off their annual bills for groceries, energy, mobile phones, and TV and telecoms packages. All told these four make up a third of the average home’s annual spend, according to Central Statistics Office figures.

The NCA says the site will be tweaked in the coming months but it is confident it won’t need to be overhauled for at least two years. Fitzgerald says it cost €80,000 to set up, a sum which would appear to represent good value for money, particularly if it can deliver the savings promised to many consumers.

She says the site was developed in “direct response to the needs of consumers in the current climate”. Market research shows that most households are tightening their purse strings to make budgets stretch further. “What’s really valuable is that the Economiser does not take a ‘one size fits all’ approach. Your results compare you to those with similar characteristics, meaning that the analysis should offer you relevant information and suggestions to achieve real savings.”

But the site does not offer concrete advice to consumers on how they can save money. It does not, for instance, suggest people switch from the ESB to Bord Gais or Airtricity because they are cheaper nor does it tell users which company offers the best value for money on mobile phone or TV packages. The advice is more vague: buy own brand products, have showers instead of baths, shop around for better value – but Fitzgerald says that the agency cannot “spoon feed” people.

The next item on the NCA’s to-do list is the professions, specifically doctors and dentists. While prices have fallen significantly in other sectors since the downturn, professional fees don’t seem to have taken a financial hit. Fitzgerald believes the failure to cut prices is down to lack of transparency. “If you don’t have an awareness of prices, if they are not visible, then how can you drive competition?”

Previously, when attempts were made to introduce price lists, doctors and dentists intimated that if the changes were forced through, then they would start charging, not by visit but by diagnosis. So if a patient had both ear and leg pain they would be billed twice. The Government took fright and the plans were quietly shelved.

Fitzgerald says the world has moved on since then. “There is more recognition that it should happen and I think there will be less resistance from the professions but if there is resistance then we will meet it head on.”

Last week agents from the NCA visited practices and clinics ahead of the publication of a price survey in the coming weeks. If the NCA can bring down the doctor and dentist prices or make people aware of how much they should pay, the chances are that calls of disapproval from the media pack will become a lot quieter.