The old saying that “light is the best disinfectant” is useful in many areas, not least when it comes to safeguarding consumers. Ireland is one of the most expensive countries in the euro zone and while this reflects in part the strength of the economy and a relatively small and dispersed population, there are many areas where questions remain.
One is electricity where even experts in the Economic and Social Research Institute (ESRI) say it is difficult to understand why prices here have not fallen as fast as elsewhere in the EU and why the gap between wholesale and retail prices seems abnormally high. Ireland has been consistently among the highest cost countries for electricity for consumers in recent years and the most expensive for businesses, according to Eurostat figures.
There are reasons why prices here are relatively high, including our reliance on imported gas to produce electricity and the mechanism through which prices are set. But as consumers are told that prices are going to increase again to fund major – and essential – investment in the network, they need clarity on what is contributing to high prices and, crucially, on the outlook for the years ahead and the promise that renewable energy will reduce prices .
While the Commission for the Regulation of Utilities may not see this as a central part of its role, it would seem the appropriate body to provide this kind of information, perhaps alongside the Department of Energy where Minister Darragh O’Brien has asked civil servants to look at the issue.
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The same principles apply in other areas, too. The Government has decided to give more powers to the agri-food regulator to oblige firms across the supply chain to give it information to inform its work. Previous attempts to study the supply chain for eggs and horticultural products fell apart as some companies would not provide the relevant data. This is important not only to protect consumers but also to ensure that big retailers or distributors are not using market power to unfairly squeeze primary producers.
Meanwhile, in the insurance sector the latest Central Bank report on liability claims contains information which allows an informed debate on claims, costs and premiums and provides clear guidance to consumers that they are generally better to seek redress for a claim through the Injuries Redress Board (IRB) rather than going to court. While the latter leads on average to a higher award, the impact of legal costs means that the IRB route generally leaves the claimants better off.
This kind of information is powerful for consumers , whose interests all too often take second place in policymaking. The Government would do well to look at other areas of notably high prices which ensure that Ireland is such a high cost economy. Transparency can achieve a lot.
