The government has brought in a new set of Maximum Retail Prices (MRPs) for several new essential consumer items but this benefit has not been passed onto consumers. The new maximum prices are introduced to safeguard consumers from sudden market hikes, a senior official of the Consumer Protection Authority said.

Stocks of sardines, onions and oil have all but disappeared from shops as wholesalers hold onto stocks rather than sell at the new lower prices announced by the government, creating a false shortage that keeps prices high.

Only at Sathosa outlets, items are sold at prices announced by the government even before the gazette to the effect was published.

While consumers are calling for the new prices to be gazetted so that traders and wholesalers would be forced to sell them at lower prices, a Consumer Affairs Authority (CAA) official explained that this could not happen yet.

Sathosa, the only outlets selling tinned fish, onions and sugar at the lower prices, has been forced to limit sales to customers to prevent merchants buying up stock to create shortages that would force people to buy at higher prices from them.

Lanka Sathosa Chairman Naushaad Perera said as a government-operated institute Sathosa was selling the three items according to the new government pricing, with a tin of sardines at Rs. 200, large onions at Rs. 100 a kilo and sugar at Rs. 85 a kilo.

The old prices are Rs. 280-315 for sardines (according to brand), large onions at Rs. 280-300 a kilo and sugar at Rs. 140 a kilo.

The consumer movement’s head, Ranjith Vithanage, said that the government should enshrine the price reductions on canned sardines, onions and sugar in a gazette.

“The President’s media unit does not determine the price changes. The changes must be gazetted, otherwise they cannot be implemented,” Mr. Vithanage said, pointing out that the old price for large onions at Rs. 300 a kilo had been gazetted.

Grocery shop owners and traders say they cannot sell these goods at the government’s lower prices because they had been bought wholesale at higher prices.

A Pettah trader who requested anonymity said he had lost Rs. 8 million having to sell onions at the lower price.

“The tax reduction does not apply to previously imported goods,” he said. “I paid the old tax to clear my consignment of onions, and now I am being forced to sell it at government-controlled prices,” he said.

Grocery shop owners claim they cannot get sardines, onions and sugar to sell to customers at the new, lowered prices because although wholesalers have – grocers assert – piles of the goods in their store rooms they claim to have run out of supplies.