asked the Secretary of State for Prices and Consumer Protection whether she has received the report of the Monopolies and Mergers Commission on the supply within the United Kingdom of contraceptive sheaths; and if she will make a statement.
The report is being published today. The commission has found that monopoly conditions, as defined in the legislation in force when the reference was made, prevail with respect to the supply of contraceptive sheaths within the United Kingdom because one manufacturer, L. R. Industries Limited (LRI), supplies at least one-third of the market. As a result of its investigation the commission has concluded that the "conditions" prevailing by reason of LRI's monopoly position operate and may be expected to operate against the public interest. In addition the commission has found that:
As regards retail prices the commission states the view that it may be worth considering whether it could be arranged that LRI should recommend the appropriate retail selling prices and print its recommendations upon the packages.
The commission makes it clear that the scope of its recommendations is limited to remedying the "mischief" attributable to LRI's pricing policy. However, it also states the view that the level of distributive margins, considered as percentage mark-ups on buying prices, is unreasonably high and that, although this cannot be regarded as being a "mischief" arising from LRI's pricing policy, it is a matter for public concern.
I am requesting the Director General of Fair Trading to consult LRI with a view to obtaining undertakings from it to take action requisite for the purpose of remedying or preventing the adverse effects specified in the report.
In so doing I shall indicate that I accept the recommendations which the commission has made as being requisite in the special circumstances of this market.
I am particularly concerned that there should be a substantial reduction in retail prices. To this end I am also asking the DGFT to consider whether it would not be appropriate, as an exceptional measure, for maximum recommended prices to be specified on the packets in which the goods are sold to consumers.