Another reason not to get involved with gift vouchers – I’m losing count now

One of the more popular pages on this site is my constantly updated feature on reasons not to get involved in using gift vouchers – you can see the latest update here.

An oldish story in the Irish Times further highlights that recommendation – Consumers warned to redeem gift vouchers without delay.

The story refers to the policy of the then “about to close down” Hughes & Hughes to not honour any outstanding gift vouchers in the run up to their closing.

All you can say really is what complete and utter scumbags they are – seeing actions like this you’d have to say “no loss” to their closing down if that’s the way they’re going to do business.

Yes, yes, I know that circumstances were different then with their running out of money and shutting down, but in fairness, if that kind of stunt is symptomatic of how they normally ran their business, then we’re better off without them.

Still though, despite the bleating from the Consumers Association of Ireland (we haven’t heard from them in a while) and the National Consumer Agency, Hughes & Hughes were completely within their rights to do this as they had probably catered for it in the terms and conditions of using (or not using) their vouchers.

According to the article, the CAI had the following potentially misleading, and ultimately pointless comment to make:

Consumer Association of Ireland (CAI) chief executive Dermott Jewell said it was “not acceptable” for Hughes Hughes not to redeem the book token while branches were still open. “The consumer holding the voucher would have a contract with that company as long as it is still trading.”

A contract, yes, where there are terms and conditions in place which the consumer would have signed up to by getting involved in the vouchers in the first place.

Maria Hurley from the NCA, apparently echoing someone from the receivers, Deloitte, at least had the factual – if not altogether helpful for the consumer – comments to make:

A company which goes into receivership does not have to honour gift vouchers, even if stores are still open. After a receiver is appointed, he or she is responsible for all subsequent decisions affecting the business, including whether gift vouchers are honoured, she explained.

I’ve said it before. I’ll say it again. In this current environment where you don’t know which businesses are ultimately going to survive, stay away from vouchers, credit notes, lay aways and even deposits – basically any situation where you give money up front to a business in expectation of a future delivery of a product or service.

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11850 moving Irish jobs to the Philippines – boycott anyone?

Twitter was abuzz last week of news that the company behind the 11850 directory enquiries service 11850 was closing down its Irish base with the loss of 78 jobs and moving them to the Philippines.

The story was covered last Thursday in the Irish Independent – Directory firm 11850 outsources 78 jobs to Asia. According to Twitter sources, the company behind 11850 is actually American, and it seems they’re turning to their global network for cheaper resources:

“Inevitably, the economic downturn has taken its toll on consumer and business spending, resulting in a decline in call volumes as a whole to all the 118 services.

“As a result, action is required to ensure the future delivery of services, and 11850 is fortunate to be able to draw on its global resources to meet that important objective and licence commitment.

The move to the Philippines did prompt some questioning as to how the new 11850 operators might be able to handle uniquely Irish names and place names. I wonder will they do as some British companies did when outsourcing jobs to India and bring the employees to the UK for some “immersion” training, and then make them watch Emmerdale, Coronation Street and Eastenders when they went back home.

Some people on Twitter also suggested that they would begin boycotting the 11850 service because of this move costing Irish jobs.

Boycotting is good! To be honest, we’re not good in Ireland at boycotting those companies that screw consumer around – how many people are still customers of the big banks despite everything they’ve done.

But would you be out of pocket if you stopped using 11850 and used another of the 118* services?

Back in 2008 I did some research (available here – Directory Enquiries Options and Costs) on the cost of calling directory enquiry services. At that time, the 11888 option was the cheapest, while the 11890 service was the fastest and best value for money option.

The crew have recently provided an updated analysis on the costs of calling directory enquiries here – Directory Enquiries – Are you paying too much?. It seems that things haven’t change much in two years with this recent research also finding that 11888 was the cheapest option.

The sting in the tail though, is that 11888 is operated by the same people who run the 11850 number. So, if you’re boycotting 11850, you should also boycott 11888.

But then using the 11890 or Eircom 11811 alternatives is going to cost you more money.

The perennial dilemma for Irish consumers – pay dearly for your principles, or sell out for the cheaper cost!

Then again, you really shouldn’t be using directory enquiries services at all these days. Have internet on your phone? Is it free? A Google search for most businesses these days provides the contact numbers in the search results before you even have to click into the website.

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Mapping the Golden Circle – excellent research from TASC

TASC, according to their website here is:

an independent think-tank dedicated to combating Ireland’s high level of economic inequality and ensuring that public policy has equality at its core.
Economic inequality is not confined to income inequality, but exists across many areas of the economy – for example, asset ownership, wealth, taxation, health, housing and education.

TASC also has a blog, progressive-economy@TASC, that’s worthwhile subscribing to, for, as they describe it themselves, “an alternative take on the Irish economy”.

Why I’m writing about this now is because TASC yesterday launched what I think is some stunning research on the multitude of cross-directorships that has existed in Ireland over the years. This research proves without doubt that there is in Ireland an exclusive “golden circle” supported by some of Irelands biggest companies, supported also by the state.

Details of the report, Mapping the Golden Circle, can be found here, while the report itself can be downloaded in PDF format from this link.

I think this report is a “must read” to see how rotten corporate governance was allowed become in Ireland over the years – and in many cases is still rotten.

The headline numbers in the report, from the summary linked above is as follows:

In the period 2005-2007, a network of 39 people held positions in 33 of the 40 top private companies and state-owned bodies. Between them, these 39 – referred to as the Director Network in TASC’s report – held a total of 93 directorships.

The 40 companies studied in this report are household names and include Bord Gáis, the Central Bank, AIB, Smurfit, Anglo Irish Bank, Ryanair and Aer Lingus. The total number of directors involved in managing these companies was 572.

Together, these companies employed 310,000 people and had a combined turnover (or equivalent) of nearly €80 billion. They included both private companies and state-owned bodies.

From my perspective, a very interesting insight is provided in the report in section 3.41, dealing with connections between directors on remuneration committees of boards. As highlighted in the report, members of a remuneration committee do not normally set the levels of their own remuneration.

However, wouldn’t it be brilliant if we were buddies and we were both on the boards of two companies. Then say, I was on the remuneration committee for one company, and then you were on the remuneration committee of the other company. You set my pay, and I’ll set yours. Perfect – and not a law of the land broken! From the report:

  • Sean FitzPatrick, Ann Heraty and Gary McCann were members of the remuneration committee of Anglo Irish Bank that set the payment for the chairperson, who was Sean FitzPatrick;
  • Sean FitzPatrick as chair of Anglo Irish Bank, was involved in setting the remuneration of non-executive directors, who included Ann Heraty and Gary McCann;
  • Sean FitzPatrick was chair of Smurfit and was a member of the remuneration committee of Smurfit, hence involved in setting the remuneration of Gary McCann, who was CEO of Smurfit;
  • Sean FitzPatrick was a member of the remuneration committee of Greencore, which set the remuneration of Ned Sullivan, chair of Greencore. Ned Sullivan was also a member of the remuneration committee of Greencore;
  • Ned Sullivan was a member of the remuneration committee of McInerney Holdings;
Check out the report – definitely worth a read.
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Buy Irish? Make sure you check the small print

I wrote recently about some comments in the Seanad and elsewhere from people concerned that Irish consumers were sometimes being conned into buying products that they think are Ireland, but are in fact not.

Here’s a great example from Tesco towards the end of 2009. Firstly, check out this picture of a display of toilet paper – you’d be forgiven for thinking that this stuff was made in Ireland.

And you’d be wrong – check out the small print from the back of one of the products:

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Can someone tell Dan White at the Herald that the NCA is going away?

Dan White of the Evening Herald wrote yesterday evening about the fact that Ann Fitzgerald has declined to accept her bonus, thought to be €37,000 – 20% of her €186,000 salary. In his article, I can’t for life of me understand why this woman on the left was being given a bonus of €37,000, Mr. White channels ValueIreland in his commentary on the usefulness of the National Consumer Agency, headed by Ms. Fitzgerald.

Some of Mr. Whites comments are as follows:

With public anger at Ireland’s sky-high prices at boiling point, the Government had to be seen to be “doing something”.

That something was the NCA, a worthy talking shop which, apart from occasionally producing useful cross-border price comparison surveys, did nothing to address the problems it was supposed to solve.

He does go on to say that Eddie Hobbs “quit the NCA board in frustration a while back”. Strictly speaking, this is incorrect as Mr. Hobbs left the board because of his frustrations with Celia Larkin rather than the NCA itself. It should be remembered that despite this posturing from Mr. Hobbs, he did offer to rejoin the board if the then minister, Ms. Coughlan, reappointed him.

Back to Dan White, and his article.

Last year, Ann Fitzgerald was supposed to get a bonus of €25,000, prompting me to post the question – Value for Money – Ann Fitzgerald of the National Consumer Agency?

And here we are, a year or so later, and a couple of more shopping surveys in the bag, and Ms. Fitzgerald is deemed to be worth an extra €12,000 compared to last year in bonus payments.

At a time when people left right and centre are taking pay cuts, cessation of bonus payments, pension levies and any other manner of payment cuts, Ms. Fitzgerald is somehow deemed to be worth an extra €12,000.

Because she’s worth it I suppose.

Well, she is heading up an organisation deemed so important that it’s going to be merged into the Competition Authority soon enough rather than be left as a standalone entity. This was announced as part of a recent budget cull on quangos – one of the few to be culled.

Probably not a problem for Ms. Fitzgerald as I’m guessing that she’s going to be appointed it’s new head honcho since Bill Prasifka, formerly of the TCA, has moved to become the Financial Services Ombudsman.

Maybe someone should have told Dan White that the NCA is going away though – maybe he wouldn’t have written this final paragraph in his article:

While the Government has so far shrunk from grasping the nettle, it is surely only a matter of time before this Government or its successor tackles the enormous number of quangos, most of which seem to serve no other purpose than to consume tens of millions of taxpayers’ euro.

In any such quango cull the NCA would be a prime target. Now that the market has achieved what it was supposed to do, what is the point of the NCA?

While Fitzgerald’s decision may have bought the NCA some time, the questions about its role and usefulness remain unanswered. Far better to scrap not just the NCA but also all of the other quangos and their automatic “performance bonuses” as well.

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More on Ireland’s Departure Tax

I wrote earlier this week about how, while I’m no fan of the governments departure tax, I don’t believe it can be blamed as much as it currently is for the woes in our tourism industry.

I questioned whether anyone actually knew which other countries charge a tourism tax as a way to illustrate how insignificant such a tax is when it comes to tourists deciding on where to visit.

I did some amount of web research trying to find a definitive listing of which countries charge a departure tax, but without much success. The waters are further muddied by the vast array of charges levied on air passengers (and again, probably unknowingly to most air passengers – just think DAA charges levied in Dublin as an example).

As an example, however, take the United Kingdom charges for example.

• For short-haul flights of less than 2,000 miles in economy-class – £11
• For journeys of between 2,001 miles and 4,000 miles – £45 for economy, £90 for business class and first class
• For journeys of 4,001 miles to 6,000 miles – £50 for economy and £100 for business and first class.
• For flights of more than 6,000 miles – £55 for economy and £110 for business and first class.

How do you feel now about our flat €10 tax?

If anyone can point me towards a listing of countries that charges an airport departure tax, drop me an e-mail via the Contact Page and I’ll publish the information here.

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Ireland’s Departure Tax – which came first, the tax or the drop in passengers

The topic of this blog post has been going around in my head for some time now, never quite making the light of day until now – so here goes. Actually, this will be the start of a bit of a tourism theme for the week.

It’s said that the €10 departure tax brought in by the government in one of their many recent budgetary attempts brings in something between €10m and €15m per month. It was expected to net €9m in 2009 and €150m in a full year.

While this tax is undoubtedly a regressive measure, we’re being told that it is because of this tax that airlines are flying less passengers to Ireland – Aer Lingus and Ryanair shouting the loudest on this one.

Yet, back in 2008, Tourism Ireland revealed that the number of tourists visiting Ireland in that year had fallen 3.3%.

Had the rot already set in even before this departure tax was decided upon?

The number of tourists visiting Ireland for a holiday dropped 20% in 2009, but given the turmoil experienced around the world because of a world wide recession, is that not the primary reason for the fall rather than this new departure tax?

Look at this another way.

Let’s assume you’re planning a holiday later this year, 2010. You’re going to fly somewhere. What dictates where you go? When you search the internet researching destinations for your holiday, do you check out hotels, attractions, sights, entertainment and places to eat, or do you first check how much is the departure tax that you’re going to have to pay when you leave?

Do you even know which countries you might visit charge a departure tax? When the tax is included in your air fare (as it is here in Ireland) you’re most likely never even going to know you’re paying such a tax.

The overall price of your vacation will determine when and where you travel – and if you’re flying somewhere, staying in a hotel and eating out for a couple of nights over a weekend, then the €10 cost of the departure tax isn’t going to be the deciding factor.

Ireland was, and still is, a very expensive destination for tourists to visit – it was in the good times, and in general (despite the fall in hotel costs in many locations), it still is now.

When potential tourists are experiencing recession in their own country and counting the pennies, we can hardly expect that they’ll be arriving here by the plane load if they’re going to have to pay through the nose for the privilege of spending a few days in Ireland.

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Fianna Fail & Consumer Protection – “more image than reality”

In recent days, the chairman of the Consumers Association of Ireland, James Doorley, has been critical of the proposal by the Department of Finance to scrap the Consumer Consultative Panel at the Financial Regulator once it’s merged back into the Central Bank.

Mr. Doorley believes that scrapping this committee appointed by the Minister for Finance would have the effect of preventing “meaningful input into the system of financial regulation”. According to Mr. Doorley:

those who pay should have a say and that the consumer voice should be at the heart of our new system of financial regulation, as it is consumers who are largely bearing the brunt of the financial crisis.

Mr. Doorley is speaking about a talking shop that didn’t meet at all during some of the most devastating months of this financial crisis at the end of 2008. As first reported here on, the panel only met once between July 2008 and March 2009.

There was an interesting exchange in the Dail earlier this week in reference to the abolition of this talking shop. Thomas Byrne, Fianna Fail TD for Meath East (one of the local TDs for Mr. Doorley as it happens) made this appeal to the Minister for Finance:

Last night, the Minister for Finance stated that he is consulting the various representative associations and interest groups. I would be keen for him to consult the Consumers Association of Ireland on this legislation and, if possible, to retain the Central Bank’s consumer panel in some form. It is included in the legislation in a different form, but perhaps it should be retained in a bid to keep the public’s confidence. The public is confident that we are looking after the consumer and doing the right thing.

However, more telling of the attitude of Fianna Fail to regulation and consumer protection in general, in response to a retort to James Bannon TD, Deputy Byrne went on to say:

However, keeping the panel would be more image than reality, since the reality is evident in terms of the regulator’s actions.

And there we have it. It’s more important to be seen to do something rather than actually doing anything at all – as I’ve said many times here before, the modus operandi of the current Fianna Fail government.

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ConsumerValue from the National Consumer Agency

During 2009, the National Consumer Agency set up a new section on their website – ConsumerValue. According to the web page blurb:

ConsumerValue aims to act as a single signpost directing you to resources informing consumers about how to seek the best deals.

ConsumerValue is not about changing the way you live your life. It is about making informed consumer choices based on full information and an understanding of what cost versus benefit mix is right for you.

While the site does provide a lot of information (and is therefore probably worth bookmarking), it’s actually quite hard to navigate your way around the many pages of information.

It’s also quite strange to see the many links provided on this government agency website to the websites of private profit making enterprises – this essentially amounts to free advertising for a select few, and a ringing endorsement from the NCA for these businesses.

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