Consumers protest at high prices

The Swiss are on the lookout for lower prices Keystone

Swiss consumers are becoming more price conscious and last year filed 33 per cent more complaints with the national price watchdog.

Delivering his annual report on Friday, price regulator Rudolf Strahm said Switzerland’s high prices were due mainly to over-expensive imports.

In 2004, 953 complaints were filed about high prices, with health costs the most frequent cause for dissatisfaction.

“We have noticed that the awareness of prices and price differences among the Swiss population is rising,” Strahm told swissinfo.

“Many people travel and they compare the prices between the rest of Europe and Switzerland. The introduction of the euro has allowed for a better comparison.”

Strahm said the rise in consumer dissatisfaction showed that the cost of living was too high in Switzerland, where prices are strictly regulated.

“Prices are high because Switzerland is not a member of the European Union,” the regulator explained. “We have too many specific regulations in Switzerland which prevent direct and parallel imports of goods into the country.”

Swiss businesses exported goods at European or world market prices, Strahm said, but paid 20 per cent more for imports. This price difference was having a negative impact on growth.

Unfavourable comparisons

The largest number of complaints – 142 – was related to the pharmaceutical sector, and included 63 about the price of drugs.

Next came the telecommunications branch, the post office and customs, followed by public transport, energy and water companies and cable television.

There were 50 complaints about the radio and television licence fee.

In many cases, the public compared prices for consumer goods in Switzerland with much lower prices in other countries.

The high purchasing power of the Swiss meant Switzerland had become “a high price island” in Europe, admitted Strahm.

The price regulator has set out two strategies for the future: combating price abuses in the country and analysing market rules governing high import prices.

“We need increased awareness of price differences and a harmonisation of Swiss norms with the European Union,” Strahm said, adding that he believed the government was ready to act against high prices in Switzerland.

“I think the political will is rising,” the regulator told swissinfo.

Strahm, a member of the centre-left Social Democrats, took over as price watchdog on August 1 last year.

The price watchdog is responsible for those sectors of the economy with limited or no competition.

But the regulator’s office has been criticised in the past for failing to tackle the problem of high prices in Switzerland.

The Swiss Business Federation, economiesuisse, has even called for the post to be scrapped altogether, saying only a liberalised market could lead to competition and consequently to lower prices.

However, the regulator has scored a number of victories, such as blocking an increase in the price of fixed-line telephone connections and reversing a hike in charges for cable access.

swissinfo

Key facts

142 complaints related to the health sector.
There were 90 complaints about telecommunications prices, and another 90 relating to the postal and customs authorities.
More than 80 complaints related to public transport, electricity and water prices.
50 complaints concerned the radio and television fee.
A further 100 complaints related to the prices of specific products.

In brief

The price watchdog is responsible for those sectors of the economy with limited or no competition.

It has been criticised for failing to tackle the problem of high prices.

But the regulator has scored a number of victories, such as blocking an increase in the price of fixed-line telephone connections and reversing a hike in charges for cable access.