GOVERNMENT will soon announce an array of price reviews, giving in to manufacturers and suppliers’ demands for realistic prices before they can av
ail goods and services on the market.
Sources privy to the policy shift said the National Incomes and Pricing Commission (NIPC) had been mandated to re-look into prices of virtually all goods as the government responds to pressure to ensure that goods return to the formal market. The sources said most of the prices would be double the July 1 prices which government slashed by half.
The NIPC this week reviewed prices of maize-meal, salt, milk, cooking oil, beef as well as beer and soft drinks in response to submissions from stakeholders in these sectors.
The commission has received hundreds of representations from businesses seeking reviews of pricing structures in relation to production costs.
“Businesses are clamouring for a credible pricing mechanism that ensures both business viability and affordability to consumers,” the sources said. “The commission is now in the process of going through the various representations and recommending the appropriate adjustments, which are a complete departure from the 20% profit margin set by government.”
This week saw a major shift in prices, with government again revising unrealistic prices set during the price reduction crackdown that resulted in serious shortages of commodities. The reviewed goods now cost more than double the July 1 prices which government slashed.
Earlier this month, government approved the increase in telecommunications tariffs, freight charges, train and airfares.
Previously, it had allowed suppliers of foodstuffs, soap, farming inputs and tyres to hike their prices.
Foodstuffs whose prices were increased include sugar, tea leaves, chicken and soda. Prices of motor vehicle tyres, Bata shoes, the whole soap range and maize seed were also increased. It relicensed 42 private abattoirs to reverse worsening meat shortages, which had forced butcheries to close.
Government on July 1 ordered all retailers to slash prices to June 18 levels, rendering useless the then newly established National Incomes and Pricing Commission which was mandated to monitor price movements across all sectors of the economy, as part of an all-stakeholder social contract which government, business and labour had signed on June 1.
The social contract suggested an agreed way forward, including measured and agreed adjustments in prices and wages.
The directive to slash prices triggered panic buying and excessive hoarding, resulting in retail shops being cleared of goods which they are now struggling to restock.
Most basic commodities resurfaced on the parallel market at exorbitant prices compared to those that were prevailing in shops.
Retailers suffered the most as those that had purchased goods at high prices made huge losses.