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Home / New Zealand

Covid 19 coronavirus: Consumers accuse retailers of price gouging face masks

Luke Kirkness
By Luke Kirkness
Sport Planning Editor·NZ Herald·
20 Aug, 2020 03:40 AM4 mins to read

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There are five more cases of Covid-19 today. Four are in Auckland and the one remaining is related to the Tokoroa case. Video / Pool

New Zealanders have overwhelmingly taken offence at the price of face masks more than anything else in the past nine days, according to the Price Watch website.

Consumer NZ has received complaints about high prices for face masks daily also.

In March, Prime Minister Jacinda Ardern urged people to raise concerns they had around businesses hiking prices during the lockdown.

Supermarket products like fresh fruit and vegetables were the subject of complaints in the previous lockdown but that's not the case any more.

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Mark Hollingsworth, the Ministry for Business, Innovation and Employment's general manager of consumer protection, says most complaints have been about masks.

A total of 268 complaints about price gouging have been lodged with Consumer Protection since August 11, 205 of them about face masks.

"Face masks are the most common complaint topic, and are related to the cost charged at pharmacies and some other retailers," Hollingsworth said.

"We have seen a limited number of complaints about supermarket goods at this time with no specific themes."

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Puna Tuia waits outside a Henderson pharmacy on the first full day of Auckland's second lockdown. Photo / Sylvie Whinray
Puna Tuia waits outside a Henderson pharmacy on the first full day of Auckland's second lockdown. Photo / Sylvie Whinray

Prior to the latest lockdown in the Auckland region, a pack of 50 facemasks could be purchased for between $30-$36 dollars at some retail stores and online sites.

But over the past week some charges have risen to more than $60.

Pharmacies selling face masks might be forced to increase prices because of additional costs for urgent orders and freight.

Some had found their regular suppliers of goods such as face masks were running out of stock, hence the increase, Hollingsworth said.

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Pharmacy sector representatives were reminded about their obligations under the Fair Trading Act by being transparent about the prices and increases.

Another obligation was working flexibly with consumers and their needs, Hollingsworth said.

"While businesses are free to set their own prices, MBIE recommends businesses be transparent about their prices and any increases during this time," he said.

"MBIE refers complaints to Commerce Commission where we believe retailers may be misleading consumers about the reasons for price increases.

"We have not yet referred any cases to the Commerce Commission since 11 August."

Consumer NZ's head of research Jessica Wilson told the Herald, like the ministry, many of their complaints were about prices charged by pharmacies.

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Increases in costs were partly to blame for the hike, Wilson said, but markups by both wholesalers and retailers were forcing prices up.

"Retail markups we've found on face masks have been as much as 70 per cent," she said.

"High markups aren't uncommon in the retail trade. But we don't think retailers should be applying their standard markups on essential items that are selling fast.

"Business would still be able to cover their costs and make a profit if they reduced their markups on these items."

In June, MBIE referred about 100 complaints to the Commission which it thought had raised issues under the act.

FACEMASK
FACEMASK

It comes after five new cases of Covid-19 were announced today, all linked to the community cluster in Auckland.

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Four are in Auckland and the other is linked to the Tokoroa case.

There are six people in hospital, including one in intensive care in a stable condition.

There is another case under investigation which was originally classed as being connected to the Auckland cluster.

They visited St Lukes Mall on Wednesday, August 12, which has been shut since alert level 3.

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