BASED ON investigations by the Consumer Affairs Commission, the Ministry of Industry and Commerce has accused a number of supermarkets and retailers of gouging consumers in their pricing of imported vegetables in the aftermath of Hurricane Ivan. The names of these outlets have been made public, among them some of Jamaica's leading supermarkets all of whom have denied the charges.Wayne Chen of the SuperPlus chain has been particularly vigorous in rejecting the basis for the accusation of the Commission whose public spokesman is Raymond Pryce. Mr. Chen is adamant that his markup on vegetables has not changed between pre- and post-Ivan pricing and points out that in fact, after Ivan, his outlets reduced the prices of certain basic items like bottled water and mackerel. He has also deplored the fact that no one from the Commission contacted him to discuss its findings before their publication.
Mr. Pryce, in aggressively defending his organisation, takes a rather narrow view of the total food chain, insisting that from import costs to selling prices there is a markup of some 240 per cent to be accounted for, an alarming percentage given that after Ivan government reduced the duties on imported vegetables from 260 per cent to 40 per cent. In public discussion of the issue, Mr. Pryce admits that a link in the food chain, other than supermarkets, may be the cause of the problem in which case it would be premature and inappropriate to accuse the supermarkets of price gouging. Price gouging, it must be noted, defines a moral and perhaps criminal activity in which a merchant knowingly adjusts his gross margin upwards to take unfair advantage of a crisis which has lessened the forces of competition. This is the charge that has been made and the one that Mr. Chen is deploring.
It has also come to light that vendors in the public markets, including Coronation, jacked up their prices of imported vegetables so sharply after Ivan that some restaurateurs were forced to run to the supermarkets for 'rescue', as one of them put it.
Yet another aspect of the matter has come from Mike Surridge, head of the Financial Investigation Division, charging that some retailers were receiving agricultural produce at cheaper prices because they were buying from illegal importers.
We think that the Consumer Affairs Commission needs to widen its investigation of the entire food chain to pinpoint where the problem lies rather than using a scatter shot approach. The public needs to be protected against unfair price increases but such protection must be balanced and substantiated, not a witch-hunt.
