Ireland’s consumer watchdog has received more than 1,000 complaints about the high price of home heating oil, petrol and diesel since the start of March but has found no evidence of price gouging on the part of fuel retailers, an Oireachtas committee has been told.
The Competition and Consumer Protection Commission (CCPC) appeared before the enterprise committee on Wednesday morning to discuss a range of issues, but with the focus largely on the high cost of fuel.
Its chairman, Brian McHugh, was repeatedly asked if there was any evidence retailers in Ireland had been making excessive profits as a result of the conflict and he said there was none.
“We’re satisfied that the real pain that consumers are facing isn’t driven by high profits outside of what [we] would normally expect and the margins that we see and we saw them previously are around 2 to 4 per cent,” McHugh said.
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He said the CCPC had been hearing concerns from consumers about the high cost of motor fuel and home heating oil on a daily basis.
“The pain is huge and the cost of living crisis is absolutely real. We don’t underestimate that pain,” he told the committee. “What we’ve done in our report is provide hard evidence on what is happening. Unfortunately it does not solve the pain that we see every day. We all have heard this idea that part of the pain is caused by profiteering, by some dodgy practices [but] the hard evidence says that the pain ... is driven by the wholesale prices and again generally prices do go up and down in line with the wholesale price.”
Asked about the increase in wholesale prices, he said that while it was not the basis of the CCPC’s recent report, there had been “a very large supply shock in the industry and while there is supply it is significantly reduced and also the risk has significantly increased”.
“You will see bids on shipments even while they’re at sea and ships will turn around and go to some place that has bid higher so you are seeing people reacting to that supply shock and reacting to that risk and the price of oil has significantly increased for that reason.”
He stressed it was a crisis on a global scale. “It is a global phenomenon We engage regularly with colleagues in every country. [Everyone] is trying to figure out how to manage the situation as best they can but in all of those countries [price increases] are driven by the wholesale prices.”
Elsewhere, McHugh pointed to some of the actions taken by the CCPC in recent months.
He described as “a major win” a schoolbus transport cartel case, with a unanimous Central Criminal Court guilty verdict for engaging in an anticompetitive practice known as bid-rigging.
He hailed the prosecution of a Kildare-based car dealer for misleading a consumer about the history of a second-hand car.
He referenced the CCPC prosecution against Brown Thomas Arnotts, which subsequently pleaded guilty to breaking sales pricing laws. The outcome in this case was a €1,000 contribution to charity. He said the financial penalty was the same result as in prosecutions against Tesco, Boots and Lifestyle Sports.
“While this was an important outcome, we have long advocated for stronger powers to tackle consumer protection law. We believe the potential for consumer detriment is extremely high, and we want financial penalties that match the crime.”
He was asked about the CCPC’s inability to advocate on behalf of individual consumers and noted it gets over 40,000 contacts and complaints from consumers every year.
“Turning the CCPC into an ombudsman to deal with individual complaints would be a very significant change to what we do and what we can do and it’s not something that we’re seeking,’ he said.
