Entities responsible for protecting South African consumers from unscrupulous practices are sorting through an unprecedented number of public complaints related to alleged excessive pricing of food products by retailers during the national lockdown to contain the coronavirus disease (COVID-19) pandemic.
Competition Commission (CompCom) spokesperson, Sipho Ngwema, told Farmer’s Weekly that the CompCom had so far received over 1 500 complaints about sellers of foodstuffs across the spectrum allegedly unjustifiably inflating prices.
“There has definitely been an escalation since people have been unable to shop around for better prices. Some foodstuff sellers have been abusing their market power in this situation,” he said.
National Consumer Commission (NCC) spokesperson, Phetho Ntaba, said the NCC had received 39 complaints of alleged price gouging by food retailers.
She added that affected food products included canned food, maize meal, cooking oil, chicken, red meat, fish, fresh milk, and baking flour.
The NCC’s acting commissioner, Thezi Mabuza, told Farmer’s Weekly that the organisation was concerned about the “rising number” of complaints related to alleged price gouging on food products.
“I want to remind businesses that COVID-19 [has been] declared a [national] disaster. Therefore, the commission will not tolerate the behaviour of unscrupulous suppliers who want to exploit the situation by unfairly increasing their prices. We take these complaints very seriously.”
Ngwema stressed that it was important to differentiate between price gouging and situations where sellers of food products had legitimate cause to increase their prices.
Reasons for legitimate price increases included increased inputs costs along the food value chain, and incidences where some foodstuffs may have been offered as low-price specials immediately prior to lockdown, with these specials then ending during lockdown.
“We’ve had complaints against some informal traders and spaza shops all the way up to some big-name retailers. We investigate each of these cases to determine whether or not the complaints are legitimate. Where foodstuffs sellers cannot give reasonable explanations for their high pricing, we then prosecute these particular sellers,” he said.
He added that, unless there was a confidentiality agreement between the CompCom and food retailers that had been prosecuted and found guilty of price gouging, the details of the prosecutions would be made public once each case had been concluded.