Minister says it won’t reduce supermarket prices

By Jenique Belgrave

Consumers are being advised that the social compact signed by the Government and the private sector will not result in supermarket prices falling, only remaining at current levels for longer or increasing by less than they would without the markup controls.

Seeking to explain the protocol signed on Monday to limit markups on a select 47 items, Minister of State in the Ministry of Foreign Affairs and Foreign Trade Sandra Husbands said the agreement effectively slows down the rate at which the price of goods can increase.

“The anticipation of the average Barbadian is that the cost of all goods would go down. That is not true,” Husbands said in Parliament on Tuesday as she acknowledged the high prices of goods in the supermarket.

“Of the 47 items that we have prioritised as essential to a household, as critical for the health of a family, we have identified those and worked with our commercial businesses and said to them, ‘we ask you to limit your profit level’. Does that reduce the original cost of the item? No, Mr Speaker. That cost can still be rising, and the percentage of your VAT, of your import duty, the percentage of the markup, will further exacerbate that price as the cost of that item and the cost of its shipping rises,” she explained.

Speaking during the debate on a resolution on the Barbados Fiscal Framework 2023-2024 to 2025-2026, Husbands reiterated that the Government was doing all it could to ease the financial burden of vulnerable households from rising global prices due to inflation.

“It means that if I am purchasing a block of cheese and it would normally retail at $6, under these current conditions of increased prices and increased transport costs, when it hits the port and attracts a duty and then is impacted by the cost of the business and impacted by their profit unchecked, it is possible that that block of cheese can go to $15, $16 or $17! 

“But if the Government can limit how much duty they put on it, if they can zero-rate it, if the businesses can limit their profit level, instead of rising from $6 to $16 it might just go to $10. So, it will still be an expense that the household will have to cope with but it is not as huge an expense as if it was unchecked. This is what this Government has done in order to shield us to make sure that we provide for the most vulnerable – by ensuring that we try to take some control and slow down the pace of the pricing to give us breathing room,” Husbands added. 

jeniquebelgrave@barbadostoday.bb