The Prime Minister's cause for alarm over higher prices charged by restaurants and hotels was not justified, according to the Malta Hotels and Restaurants Association.
MHRA chief executive officer George Schembri said it was normal for restaurants and hotels to up their prices in April because it marked the start of the summer season. He pointed out that prices in the sector then dropped drastically in November, at the start of the winter season.
However, a spokesman for Prime Minister Lawrence Gonzi insisted yesterday that "at face value" the situation looked "illogical" and that was why Dr Gonzi had asked for an "analysis" of the price movements.
"In times of decreased demand, prices should drop not rise. National Statistics Office figures issued last week show a steep increase in hotel and catering prices when demand for these services is this year lower than that of last year. The Prime Minister is seeking clarification as to what is causing this apparent anomaly," the spokesman said.
Hotels and restaurants came under fire last week when Dr Gonzi said he would be investigating the sector's price increases, which jumped by 11 per cent in April over the previous month.
NSO statistics extracted from the harmonised index of consumer prices confirm that over the past three years price changes over the previous month have gone up in April and down in November. Last November, the restaurants and hotels index registered a drop of almost 14 per cent. "We cannot understand why all the fuss when restaurant and hotel prices have always gone up in April to reflect the peak summer months. What the Prime Minister did not say was that in November prices have always dropped in line with the weaker demand in winter," Mr Schembri said.
He also pointed out that operators have had to shoulder higher utility costs, steeper gas prices and new swimming pool rates, which had to be recouped in one way or another.
Mr Schembri insisted that Dr Gonzi's cause for alarm was not justified and it made more sense if he investigated the NSO's methodology of collecting data rather than investigating restaurants.
The MHRA yesterday said NSO only surveyed seven restaurants from a total of over 1,500 and used hotel room rates taken from websites to establish the price index for the sector.
Contacted by The Times, the NSO said the MHRA's claim that the survey to determine restaurant prices was based on seven restaurants was "inaccurate".
It did not elaborate on its methodology but insisted it was the same one used for "several years".
"Malta's HICP is periodically reviewed by Eurostat. In its last compliance monitoring report submitted in 2007, Eurostat said it considered that 'in general the methods used for producing the Maltese HICP are satisfactory'," the NSO said.
The office also offered to give the MHRA an explanation on the method applied for the compilation of data.