Irish Tesco Costs More

A basket of common groceries in Tesco costs on average 18% more in the retailer's stores in the Irish Republic compared to its outlets across the border, according to the survey by Consumer Choice magazine.

The price differential for some items was as high as 37%, and 24 of the 25 items surveyed were cheaper in Northern Ireland.

Tesco has accepted that prices were higher in stores in the Republic, but said the average gap across thousands of goods was 12%.

This difference was explained by the higher cost of doing business in the South, as well as a difference in tax rates, a spokesman said.

Shoppers from the Republic spent over €550m in Northern Ireland last year, sending Irish retailers into a near crisis as the grocery market shrank by over 5%.

Since May, however, when Tesco introduced its change for good price cutting strategy and rivals followed suit, the cross-border exodus has diminished.

Before the price war, surveys showed a price gap of 30% between North and South. The revelation that much of this differential is still in place could give renewed impetus to cross-border shopping and cause problems for retailers in the Republic in the run-up to Christmas.

RGdata, which represents smaller grocery businesses in the Irish Republic, said it agreed that customers were being misled.

Chief executive Tara Buckley said it had complained to the National Consumer Agency and the Advertising Standards Authority of Ireland about Tesco's advertising claims, but had yet to receive a response from either.

This report underpins the need for an independent consumer advocacy body, which is not tied to the State and which is not afraid to criticise big business, she said.

See: Cross Border Shopping Fears Hit Southern Exchequer

(BMcC/GK)