Supermarkets raise prices after receiving wage subsidies

Top News | Maisy Mok 30 Nov 2020

Supermarkets have jacked up prices of products after receiving subsidies from the government's second tranche of the Employment Support Scheme.

The Democratic Alliance for the Betterment and Progress of Hong Kong found that among 21 items from the two major chains they have been monitoring, prices of seven products from ParknShop and five from Wellcome were higher this month than in September.

Cleaning products such as Attack's 2.5-kilogram Conc Powder Laundry Detergent costs HK$45.40 at ParknShop and HK$45.10 at Wellcome in September but rose to HK$46.90 at both supermarkets this month, the DAB's Supermarket Price Concern Group found.

"It is not beneficial to the public when prices still increase during the epidemic," the DAB's Leo Ho Kwan-chau said.

The government said on September that Wellcome and ParknShop received wage subsidies of HK$184.5 million and HK$161.96 million respectively and required its rebates to be no less than 50 percent of the wage subsidies.

Both supermarkets are giving back through the distribution of cash coupons and other ways. Ho said he has been receiving inquiries from many Sham Shui Po residents on how to apply for the coupons.

The public cannot directly benefit from the rebate scheme, he said, adding "past discounts that supermarkets provided might be even more attractive."

The group has been monitoring price changes since August 28.

Although Wellcome's price index fell from August to October, the price index for its products increased from 620.8 on October 30 to 637.5 on November 20, it said. The rise came after Wellcome announced giving cash coupons and meal coupons to specific people, including the needy.

The DAB's Szeto Chun-hin said: "Take rice for example. The frozen price that Wellcome offers for Golden Elephant's 5kg Premium Jasmine Rice is HK$75 [and] competitor ParknShop has reduced its price to the same level," he said.

"However the price for Golden Phoenix's Thai Hom Mali 5kg Fragrant Rice did not decrease but increased, meaning people are forced to buy expensive rice during the pandemic."

Convener Frankie Ngan Man-yu said those that usually buy Golden Phoenix rice will not switch to Golden Elephant rice, adding the frozen price scheme is not part of the rebate. Ngan said supermarkets should cut prices by 30 percent to benefit all Hongkongers after the employment subsidy scheme ends this month.

The government should also provide clear definitions of "original price" and "reduced price."

He called on the Competition Commission to monitor the price changes and probe whether there is price-fixing between the two chains. He also advised consumers to monitor the prices regularly, read the price tag clearly and check their receipts.

maisy.mok@singtaonewscorp.com



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