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The Consumer Council of Fiji has pleaded with the government to reform consumer protection laws and redress mechanism to address anti-competitive behaviour before phasing out price control.
Commenting on the announcement in the 2010 Budget to phase out price control to promote competition in the marketplace, council chief executive officer Premila Kumar said the council’s market surveillance indicated that price fixing, collusion and cartel type operation was rife in the marketplace.
“Unless this is addressed the consumers will not benefit and the good intention of the government will not materialise,” said Kumar.
She said past market trends indicated that whenever government reduced duty or removed Value Added Tax (VAT) to ease the financial burden on consumers, the benefits did not reach the public.
“The council is concerned that the removal of price control might also be abused by some unscrupulous traders who will see this as an opportunity to increase their profits instead of creating healthy competition and lower prices for consumers. For example in 2008, the government removed VAT from locally produced eggs and the council through its price survey found that despite VAT removal the prices of eggs continued to increase. Hence the consumers did not benefit but the trader gained through increased profits.”
Overall, Kumar said the 2010 Budget was unconventional yet refreshing and practical and was prepared with the view to take the country forward.
“Instead of alleviating poverty through blanket remedies the government has provided a more targeted approach such as the introduction of a $10000 home grant for new home owners and a $30 additional food allowance for those receiving Social Welfare benefits, to name a few. Now the onus is on respective institutions to ensure the disadvantaged consumers receive these benefits without red tape and mismanagement.”
