Under the price control, the maximum retail price for white sugar was set at Rs. 87, 400g of milk powder Rs. 325 and 1kg Rs. 810, 400g of Sustagen Rs. 1,500,1kg of wheat flour Rs. 87, 1kg of green gram Rs. 265, 1kg of imported dried sprats Rs. 385, 425g of canned fish Rs. 140, 1kg of coriander Rs. 350, 1kg of Maldives fish Rs. 1,740, 1kg of turmeric Rs. 800 and 1kg dried chili powder Rs. 400.This order was to take effect from February 20, 2015. Further, in November 2015, six more commodities were added to the controlled price list. Under this, dried sprats were set at Rs. 410, 1kg of dhal Rs. 169, 1kg of dried fish Rs.1,100 and1,400g of local milk powder Rs. 295 were fixed for prices. According to the Consumer Affairs Authority’s (CAA) directive, these prices were imposed on November 24.
However, these prices were not properly executed in the market and when we asked traders for the reason, they justified increased prices saying that due to high transport costs, labour charges and other expenses the goods cannot be sold at a controlled price. On the other hand these control prices were not seen to be executed even by government-owned outlets, the best example being Sathosa.
The Co-operative Wholesale Establishment (CWE) or Sathosa is the key governmental trade institute that provides essential commodities to the public at a concessionary rate for both rich and poor alike in both rural and urban areas. Sathosa’s controlled prices have set an example to other traders in the market who are not able to increase their prices arbitrarily. Unfortunately however, this time the forerunner in fair trading has also failed to sustain the control prices.
To have a closer look at their prices, we visited several Sathosa outlets. As expected, most of the shelves were empty and the lack of quality was very evident.
Expressing his views about Sathosa, Upali Samarakoon, a trishaw driver from Kiribathgoda who we met near one of the Sathosa outlets said, “There is nothing good to be found at Sathosa. It is better to go to a Food City outlet where at least there are promotions for some food items. Earlier, Sathosa had a good business running and we too had good hires. But everything has changed now. Sathosa must at least reduce its vegetable or fish prices. This government has increased prices of all products. We have no solace anywhere.”
Deepani, who had been a regular customer at Sathosa for many years, said, “There is no point in going to Sathosa now. I just come here merely out of habit. Most of the vegetables here are of low quality.”
These were the common complaints of many customers. They also affirmed that there were no commodities of control prices.
In one of our investigations we saw a billboard in one of the Sathosa outlets that claimed that 1kg of sugar could be bought for purchases above Rs. 500.Accordingly relative to the bill value, 1 kg of sugar could be purchased at Rs. 87. In some areas this bill value had been increased to Rs. 2,000. Accordingly, in order to buy 1 kg of sugar at Rs. 87, the poor customer must spend a further Rs. 500 at Sathosa. Most of the customers told us that they would not come to Sathosa to buy sugar at Rs. 87 if they had Rs. 500 to spend. However, there are some products available at Sathosa at a control price. For example Sustagen and milk powder are being sold at a fair price. But other products such as dhal, sugar and dried fish are not subjected to such controls and can only be purchased under the above conditions. “The government is not thinking about the people. As we are unable to buy more, we have been compelled to eat less. Soon our society will be consumed by malnutrition. It seems as if the government is once again trying to sell Sathosa to a private entity. The government must be able to provide relief to the people through a ration system.” This was the opinion of Sumith Galhena.
This kind of imposing of conditions to buy sugar is a clear violation of Article 16(b) of the Consumer Affairs Authority Act no 9 of 2003. Ranjith Vithanage, Chairman of the National Movement for Consumer Rights Protection pointed out that complaints have already been made regarding the matter. Vithanage said the inefficiency of Sathosa has become profitable for other supermarkets.
Article 16(b) of the 2003 Act says that no other condition except the one that the customer has to pay up-front can be imposed upon a sale of a product.
Presenting their side of the story, many traders have said that they cannot adhere to the control price for many commodities as the initial purchase prices have gone up due to the variation of the dollar rate. Most of these relief measures that were imposed during the 100-day programme of the government have now been changed. When we questioned a Sathosa branch manager about these unlawful conditions, he said this has been done as a precautionary measure to prevent people from purchasing goods from Sathosa at a low price and later re-selling them in the retail market. Expressing his views regarding the matter, Chairman, All-Island Traders Union Collective, Indika Liyanage said, “The control prices have ruined us.
When we are unable to stick to these prices the price control authorities take legal action against us. The international markets have changed now. When the control prices were imposed the dollar rate was only Rs. 108. Now it is Rs. 148. We have discussed this matter recently with the President. He promised us another gazette notification. These control prices must be changed. Otherwise there is no point in doing business. The government must introduce alternate means of relief to the people.” Speaking of control prices, Director General of the Consumer Affairs Authority, D. D. Arandara said that under control prices the traders may try to sell low quality products or even try to create a shortage. However, the raids have now been stopped.
Authorities have pointed out that it is up to the government to take a decision on the prices. The CAA has already notified the Cost of Living Committee regarding the matter. They too have recommended a change in the control prices. Commenting on the matter, JVP parliamentarian Vijitha Herath said officials were more concerned about earning profit from Sathosa rather than finding ways to provide goods at lower prices. He also accused officials of dragging Sathosa towards certain bankruptcy.
- Ashanthi Warnasuriya