IT’S NOT OUR FAULT, MR WATSON: Food retailers hit back after press secretary blames them for prices

• Sector says it’s an ‘easy blame target’ for high prices

• PM spokesman hints some not passing tax cuts on

• Super Value chief: ‘We passed on every single one’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Food retailers yesterday hit back over assertions that some merchants have not passed the Budget’s tariff cuts on to consumers via reduced prices, adding: “You can’t point the finger of blame at us.”

Philip Beneby, the Retail Grocers Association’s president, told Tribune Business the industry was an easy target and scapegoat after Clint Watson, the Prime Minister’s press secretary, made a thinly-veiled suggestion that not all stores have passed the anticipated savings on to food shoppers.

While providing no names or evidence, Mr Watson said the sector has “a responsibility to pass that relief on” to Bahamians and called on the public to hold the food retail and wholesale industry “accountable” for the prices they are charging now the tax cuts have been effect for some two months.

Asked about the Government’s plans to ease the cost of living crisis faced by many Bahamian families, amid surging inflation and widespread price increases, the Prime Minister’s chief spokesperson referred to the multiple food, construction material and other tariff cuts enacted in the 2022-2023 Budget.

“Now we know there are certain food stores who did bring reductions. We’ve heard about these and we’ve seen those, and I believe, rightfully, that’s the kind of question and pressures that (should) be put on retail operators and owners,” Mr Watson added. “The Government said that they put this relief in place so that Bahamians can feel the relief. . .That’s a good question for them to answer.

“Certainly we can’t answer that. They ought to be able to tell you that, yes, we’ve reduced eggs or we have reduced milk. That is the kind of question we want to see people put to these wholesalers and retailers so that they can be accountable to their consumers who are spending money with them because the relief is being put there by the Government.”

Mr Beneby, though, told Tribune Business yesterday that “there’s no question” that the Budget’s food-related tariff cuts have been passed on by the Association’s members via lower prices for the impacted foods. And Rupert Roberts, Super Value’s principal, said the 13-store supermarket chain’s computer systems “automatically” passed those savings on in the final prices.

Promising that Super Value is seeking to “keep food on the Bahamian table at the best possible price”, he reiterated that as a nation that imports virtually all it consumes this nation is at the mercy of global market factors beyond its control such as the post-COVID supply chain shock, the fall-out from Russia’s invasion of Ukraine, and high oil/fuel prices that have driven up the cost of both sea and land transportation.

“There’s no question about it as far as I’m concerned. Whatever costs are provided they are passed on. Whatever costs the wholesalers present to us are reflected in the price,” Mr Beneby said. “The blame is always passed on to the retailers; that’s the easiest way.

“Some of the savings [from the tariff cuts], they are so minor or miniscule that, by the time the wholesalers get it to us, the change in the cost is only pennies sometimes. There’s no big reduction in the price. As a matter of fact, there’s going to be price increases in items moving forward probably for the rest of the year moving into 2023. You cannot buck the global markets. We are importers, not producers, of food.”

Mr Beneby declined to specify which food items will likely see further price increases, or by how much, although this will further fuel the cost of living pressures being experienced by many Bahamian middle and lower income families. “We just have to watch the trends and, like they say, go with the flow. Just buy what you need. That’s all we can do,” he added.

Competition between rival food stores should keep prices keen as consumers can switch from higher-cost merchants that fail to pass on the Budget’s tariff cuts. And, when it comes to price-controlled foods, the Government has the necessary tools and authority to initiate action by the Price Control Commission.

The pricing regulator is presented with wholesalers’ invoices and import bills of lading, and can cross-check these with their foreign suppliers. “The price-controlled prices come to us from the wholesalers,” Mr Beneby added. “They cannot sell above the wholesale prices and margins that Price Control dictates and which are passed down. They cannot sell to us above that, and we put our price-controlled mark-up on it.”

Mr Roberts, meanwhile, said he was unsure who Mr Watson was referring to but added: “It’s certainly not us. They can’t point the finger at us. We’re trying to keep food on the Bahamian table at the best possible price. We don’t control the world. There are certain things beyond our control, but when we find out about them we take certain steps to mitigate them.

“Our system automatically passes that [tax cuts] on. It goes through the computer, the cost of freight and duty, and if it goes up we check it and if the prices decrease we let it go through. We’ve passed on every single one.”

The Super Value chief earlier this year told Tribune Business the Budget’s tariff cuts would not be a one-shot cure-all for soaring food prices but, rather, would help mitigate some of the worst increases. Citing eggs as an example, he added that while the Budget had reduced the relevant tariff from 30 percent to 10 percent, prices had still shot up because bird flu wiped out millions of egg-laying chickens in the US.

“There were some unfortunate things that happened at the time when they reduced the duty on eggs from 30 percent to 10 percent,” Mr Roberts explained. “Eggs went up in price by 50 percent in the US because of bird flu. They lost millions of chickens. Prices took a leap but they’re coming back down. We import eggs three times’ a week. We have 18 perishable containers a week and adjust the prices accordingly.

“We expect these price increases to go on. Inflation, I think, is going to continue through the first of the year and then start levelling off in the first quarter of 2023. We’ll see creams going up, we’ll see rice going up. I encourage consumers to buy what we offer because we’re offering the national brands but also putting in some private labels that cost considerably less.”

The Government’s view is likely to be that it did as much as it could in the 2022-2023 Budget to ease cost of living and inflationary pressures given that fiscal squeeze it faces itself. In its food tariff reduction measures, it appeared to target cuts that will have the greatest impact in mitigating the cost of living crisis.

Besides chicken and eggs, the rate on pork was slashed from 25 percent to 10 percent, while mashed potato became tariff-free from July 1 as opposed to the previous 35 percent rate. Protein powder was cut from 40 percent to zero, while flours of vegetable base saw its 35 percent duty rate completely eliminated.

Prepared beef, pork and turkey were dropped from 20 percent to zero, while raw ground nuts (peanuts) exceeding 10 percent also become tariff free. Prepared salmon, herring and caviar were cut from a 40 percent import tariff to 20 percent - a drop in rate of some 50 percent.

Comments

Dawes says...

Food retailers should put the amount that Government gets from each product on it too. Same with the gas stations. That way people will understand quite how much Government takes.

Posted 26 August 2022, 9:25 a.m. Suggest removal

KapunkleUp says...

Damn right. VAT, duty, VAT on duty, inspection fees, VAT on transport fees, etc... A $3 item might have an actual purchase cost of $1.

Posted 26 August 2022, 1:39 p.m. Suggest removal

birdiestrachan says...

The merchants
will never pass on any saving , they will add the reductions to their profit

Posted 26 August 2022, 10:05 a.m. Suggest removal

Sickened says...

You have PLP cronies in the food sector huh? You speak with such authority.

Posted 26 August 2022, 10:35 a.m. Suggest removal

ohdrap4 says...

> mashed potato became tariff-free from July 1

WTF eats boxed mashed potatoes? not in the Bahamas, no, so the stock in the food stores, right now is still old prices.

> Protein powder was cut from 40 percent to zero, while flours of vegetable base saw its 35 percent duty rate completely eliminated.

makes no difference to th e average person. One or two woke tree huggers in the GOVT
wanted to go duty free. OK, alright, the price of one pound of arrowroot was reduced from 15.35 to to 9.95. I could not afford it before, cannot afford it now.even Clint Watson does not eat vegan, one can see.

I wil say tho, that Super Value, Solomons and Restaurant Supply have offered some good deals in the past 6 months, where they order their on containers. I say this because their prices often beat those of certain wholesalers, which shall remain nameless.

Shame on the govt for keeping 35% on the whole chicken and chicken breast.

Posted 26 August 2022, 11:10 a.m. Suggest removal

TalRussell says...

By the way notin' thinly-veiled about why.. **''Eight out Ten'** shoppers' experiences were surveyed ... Sayin' ...Whatever the profitability trajectory...  Culturally, the colony's 'Grocer Retailers and Suppliers' belly buttons **'are lookin' more alike than unalike.'** ... Show good faith by statin' goin' do away with subjectin'  to Her Majesty arrest, fine and imprisonment calls out **'uppin' the grace value tolerance extended shoplifters'** .... Along clearly **'posting of such changes throughout premises'** ― Yes?

Posted 26 August 2022, 11:58 a.m. Suggest removal

BMW says...

how about Bahamian people start holding the politicians and their cronies accountable!

Posted 26 August 2022, 12:28 p.m. Suggest removal

TalRussell says...

@ComradeBMW, have you not experienced/witnessed lingering July 9, 1973 symptoms? ... Was there such a thing as 'Bahamian People?' ...  Many might be inclined to say 49 years on the other side of Independence .... We still are governed everyday like a populaces who is **'three-fifths of a Bahamian'?** Is the **3/5 clause** not still written into the colony's Constitution ― Yes?

Posted 26 August 2022, 2:03 p.m. Suggest removal

BMW says...

you not taking your meds today tal?

Posted 26 August 2022, 2:17 p.m. Suggest removal

bahamianson says...

Super value, you are not telling the truth. A roll of hand towel on sale before duty was.dropped on it by the government was .99 cents. When the government dropped duty on said item , it has never been .99 cents. What happened to the extra cost? Super Value , you did not pass it on. I buy hand towels every week, so I know what I am talking about.

Posted 26 August 2022, 1:58 p.m. Suggest removal

The_Oracle says...

Interesting that for the first time we have a Bahamian press secretary, simply spinning whatever he can out of whatever his boss tells him to say. Easy enough to see through him.
Costs have gone up on first cost of all manner of items, as has availability of all sorts of items being short.
It will get worse. This week y'all worried about price, next week or month it may be "taint none!" 90% of Bahamians looking to the government, which makes the most off all from retail on the myriad of taxes, to save them!
Hilarious if it were not so sad. Zero duty on an item not found is irrelevant.
Zero duty on an item with a first cost increase of 30% is also irrelevant.
In supply and demand Government is powerless.

Posted 26 August 2022, 6:24 p.m. Suggest removal

Porcupine says...

Too bad with all the brilliance abounding that the one solution to this is never even discussed.
What kind of society do we live in where people can work a full time job and yet still not be able to afford adequate groceries for their families?.
The lack of education has served our politicians, and press secretaries, well.
We don't even have to discuss the real issues.
Lovely.

Posted 30 August 2022, 6:24 a.m. Suggest removal

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