NECC forces eatery to reverse price increase

A major catering establishment in Valletta has cut its prices following the intervention of the National Euro Changeover Committee, which acted on complaints that the outlet had substantially increased the cost of the items on its menu from July.

NECC executive director Alan Camilleri insisted that the euro should not bring about an increase in prices.

Any price movement that is three times more than the inflation rate is immediately queried, Mr Camilleri said. In the case of the Valletta outlet, the price rise was way above that and needed to be justified.

The establishment was asked whether it had really increased the prices and, if so, to provide documented evidence on the reasons why. Since these were not acceptable, the establishment risked being fined Lm750 and Lm75 a day. It decided to revert back to its pre-July prices with immediate effect, Mr Camilleri said.

Every complaint on price increases is investigated by the euro observatory of the NECC, he said, adding that there have not been cases of huge rises or too much abuse across the board.

Out of 75 cases it investigated, the NECC only felt the need to further investigate five establishments - mostly bars, restaurants and cafeterias, not retail outlets.

It was clear that the public's preoccupation had shifted, as expected, from dual pricing to price movement, and the NECC would be responding to that need with more information on the matter, identifying what increases were justified and which were not, Mr Camilleri explained.

The NECC has been monitoring the movement of prices since March and will be launching a price watch website in September, listing the average costs of 400 products and services so that the consumer could make comparisons.

From research carried out by the NECC on the Retail Price Index and Household Index Consumer Prices, it was apparent that, over the past five years, catering establishments changed their prices in June and January, which had nothing to do with the euro, Mr Camilleri said, explaining that seasonal adjustments had to be taken into account.

Some establishments first set the euro price to be sure it was a round figure and then converted it to liri but in so doing they were often actually decreasing the price, or converting backwards at the right rate, Mr Camilleri pointed out. They would also be factoring in the price increase due to seasonal adjustments.

The NECC has carried out 23,000 visits to 7,000 establishments in Malta and Gozo since January and has now stepped up enforcement in the tourist areas.

Its campaign is being intensified as the date for the adoption of the euro approaches, Mr Camilleri said. While information was abundant, feedback was also being received to up the dosage and action was being taken.