Price Hikes on Back of Euro "Not On" - Kitt Warns

Codes of Practice on Dual Pricing are an important element in the provision of information to consumers about the euro. While euro notes and coins will not be introduced for another two and a half years from 1 January 2002, it is important that consumers become familiar during the transitional phase with the new currency.

The purpose of the new Code I am launching today (Wednesday 9th June, 1999) is to inform consumers by providing for transparency in the pricing of goods and services during the changeover from the pound to the euro and to assist consumers, in a practical way, to become familiar with pricing in the new currency. The Code is designed for retailers and other suppliers of goods of services.

The key features of the Code are

- its acknowledgement of the role of codes drawn up by business organisations

- the strict rules on conversion from Irish pound prices to euros (the six digit conversion rate - 1 euro = £0.787564 - must always be used),

- the period of application of the Code,

- compliance with the Code, and - the logo.

The Code adopts a voluntary approach and is designed to complement codes devised by business organisations, such as IBEC. I very much appreciate the energetic and pro-active approach which IBEC and other organisations have been taking on dual pricing, not just in relation to codes but also in relation to information and education initiatives.

Many retailers and other suppliers of goods and services may wish to subscribe to codes drawn up by organisations, such as IBEC. I would strongly encourage this development. In fact, it is specifically provided for under the Code being launched to-day, in that subscribers to other codes on dual pricing will be considered to have met the terms of the national Code on approval of such codes by the Director of Consumer Affairs.

n important feature of the Code is the conversion rate from Irish pound prices to euro. The correct conversion rate (1 euro = £0.787564) must be used in all price conversions. An Irish pound amount is converted to a euro amount by dividing the Irish pound amount by 0.787564. The resulting euro amount should be rounded to two decimal places, i.e. to cent. Equally important is the commitment by subscribers that they will carry out the changeover to the euro fairly and will seek no advantage from the conversion.

The minimum period during which the national Code will apply will be from 1 October 2001 until one month after Irish notes and coins have been withdrawn in 2002. I am confident, however, that dual pricing will begin much earlier than that - indeed we are already seeing examples of dual pricing in the retail trade. Where subscribers to this Code undertake dual pricing before October 2001 the provisions of the Code will apply.

The other reason for bringing forward the Code in 1999 is to allow for other codes, which have not yet been finalised, to be prepared by particular sectors, approved by the Director of Consumer Affairs and "slotted in" to the "family" of codes, which will be a feature of the changeover period. I am aware that the Director of Consumer Affairs is currently examining three draft codes. The publication of the national Code will set the framework against which future codes can be measured.

Compliance with the Code will be the responsibility of the subscribers and complaints should, in the first instance, be directed to the subscribers or associations, where the latter subscribe on behalf of their members. While the Director of Consumer Affairs, Carmel Foley, will be prepared to deal with any unresolved complaints, it is hoped that such complaints will be few. It is a voluntary code and I expect that businesses and associations which subscribe to the Code will be serious about meeting their commitments.

The logo for the Code will consist of the logo used by the Director of Consumer Affairs and the logo of the European Commission. The former will be instantly recognisable to Irish consumers whereas the EU logo will be familiar to European visitors. The logo will include a contact point for use by consumers where they feel that the terms of the Code have not been complied with.

The Code was launched in draft form for consultations in January 1999. I would like to thank those who provided comments on the draft Code, in particular, the Office of the Director of Consumer Affairs, the Euro Changeover Board of Ireland, IBEC, the Forfas Retail Working Group and the Consumers' Association of Ireland.

The launch of the Code is an indication of my determination that consumers will not be exploited by the changeover process. I have said it before and will say it again - price hikes on the back of the euro are not on. I am determined that consumers will be adequately informed and informed in advance about the changeover. To-day's launch is part of the Government's strategy to ensure that there will be no information deficit for consumers.