Monday, June 14, 2010

Shops’ opening times

The controversy around controlling the time when shops should be allowed to open is rolling again. Paradoxically, it was started by the GRTU which up to some years ago opposed the public demand that shops should be allowed to open on Sundays. This year the GRTU proposed that shops should be allowed to open on the 31st March which is a public holiday. On that day, there seems to have been a consensus between the constituted bodies. The government agreed. There was another request by the GRTU for shops to be allowed to open on May 1st, another public holiday. The Ghaqda tal-Konsumaturi supported this position.

This time round ranks split. The Chamber of Commerce objected regarding shops opening on 1st May and the Government did not grant this request. The issue took a turn as the Ghaqda in its statement raised the issue of shops’ opening hours. It was stated that the legislation should be changed in order to allow shops to open at all times.

There are several reasons for this position both commercial and social. It should be realised that today, the official policy is that of a liberalised market. If we look at the commercial side and recognise the amount of capital involved in setting up a shop, one would easily understand the reason. A small calculation will help here. Assuming that the shop owner opens between 09.00 – 13.00 and 16.00 – 19.00 on week days, opens half day on Saturday and remains closed on Sunday one finds that the shop owner can only utilise less than a 25% of the time available to cover his capital and make a living.

The situation is further complicated if we look at the time a working couple can work within these opening hours. A couple who work from 8.00 a.m. till 19.00 will find that it has only about 3 hours to do shopping from such shops during a weekday. It is because of this situation that Saturday morning is usually devoted to shopping as it has four hours of shopping time available at a stretch though Saturday does not provide the solution to all consumers as parents with young children know. This time restriction is increasing the cost of business which cost is then shared between the commercial outlet and the consumer. This, apart from the fact that we are depriving ourselves of a higher rate of wealth generation.

The above generalisation already shows how illogical the present system is. It may have been logical when it was introduced but surely it doesn’t fit with the changes undergone by society. However, there is another aspect. Business should be left to operate as freely as possible. This should not be interpreted that such structures as regulators or consumer protection or the setting up of standards should be abolished. The need for these is still required because the market cannot handle these aspects.

When this controversy was at its best some years ago, the workers’ argument was used to block change. It was said that both traders and workers need a day of rest. We are sure that every trader who knows his business can still get this day of rest. Many restaurants already use this system by not opening on Monday as they know that trade on that day is at its lowest.

Regarding the workers, everybody accepts that in today’s world, many activities need to go on. Previously it was only accepted that only certain categories of workers need to work on Sunday. As society changed, other categories were included. In the twenty first century, changes in lifestyles are indicating that this should now be extended also to these workers. With regard to their rights such as adequate compensation for the unsocial hours they have to work, I am sure that trade unions are able and willing to negotiate acceptable agreements and safeguard such rights, only if the workers themselves make the effort to join a trade union.

There is one final aspect. Whether we like it or not, we’re living in a market economy where competition, despite the efforts of those controlling markets, will exist because of new alternatives being developed. One such alternative which is having an increasing effect on local trade is internet shopping.

Looking at the local market, one finds that local consumers are aware that the prices found in local shops are higher than one finds them in other areas of the Single Market and which are accessible through internet. Moreover, from the statistics published, more Maltese are turning to shop through the internet. The local traders through their close contact with the political class can try to protect themselves against competition but they cannot completely control internet shopping.

Thus the local traders must be given the chance to operate at the best time that matches their own with those of consumers. The only way to do this is to liberalize the shopping hours for the benefit of both consumers and traders.

We realise that this change, like all others, may present some problems to shopkeepers and other retailers who employ staff, but we are sure that each can develop a system where the adverse effects are minimized and the benefits to both are maximised. We hope that eventually, the change of heart adopted by the GRTU will also filter to the Chamber of Commerce.

The only hitch there seems to be is that the government through restricting shops’ opening hours has found another convenient way of sucking up more finance from the economy to the detriment of both consumers and traders.

The charge of €700 for a one-day licence to open a retail outlet on a public holiday is both unjust and irrational and will put both the local trader and consumers at a disadvantage, because it makes trade more expensive for both.

Published on Maltastar.com 03rd June 2010