Tuesday, 3 October 2023

Sunak Demands an Investigation of Unreported Payments

Rishi Sunak has requested a review of “drip pricing,” a practice where businesses charge extra fees to customers to conceal the full cost of goods and services. In response to a broader cost of living issue, the UK prime minister declared that the government will look into the practice’s prevalence and, if required, establish steps to address it.

Drip pricing refers to the practice of businesses adding additional booking, joining, or other fees to the price of goods and services including concert tickets, gym memberships, and airfare.

Rishi Sunak’s Request

Before adding on additional fees for baggage, priority boarding, in-flight meals, or seat reservations, some airlines offer consumers headline pricing. Although the tactic is lawful, consumer rights organizations are concerned about it because they believe it is a sneaky approach to extract more money from customers.

To learn more about drip pricing’s prevalence and potential harm, Sunak requested that the business department conduct an investigation. If more action is required to address the problem of rising living expenses, the government plans to do so.

  • Drip pricing involves businesses adding fees to goods and services prices.
  • CMA may expand authority to address drip pricing, strengthening post-Brexit consumer rights evaluation.
  • Drip pricing in industries boosts customer acceptance.

According to authorities, the Competition and Markets Authority (CMA) may receive expanded authority to address drip pricing. The government’s evaluation of post-Brexit consumer rights and protections is strengthened by Sunak’s initiative.

Many industries use drip pricing, including train reservations, food delivery services, and concert tickets. According to Rocio Concha, director of policy and advocacy for the consumer group Which? fees can be imposed later in the purchasing process, increasing the likelihood that customers will accept them.

It is encouraging that the government is looking into these dishonest practices, but to put a stop to this behavior, the government needs to take additional steps by clearly banning drip pricing in its digital marketplaces, competition, and consumer bills.

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