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MONEY

Danish minister vows to monitor prices to prevent ‘unfairness’

Denmark’s Business Minister Simon Kollerup says authorities will keep an eye on price increases to make sure companies aren’t taking unfair advantage of inflation.

Danish minister vows to monitor prices to prevent 'unfairness'
Danish authorities are set to intensify monitoring of food and electricity prices to ensure they are not raised above inflation. Photo: Liselotte Sabroe/Ritzau Scanpix

More stringent price monitoring will ensure that “potential unfairness” is exposed, Kollerup said in a press release.

The minister said he had no evidence for any such instances of companies taking advantage of inflation to raise prices unfairly. Nevertheless, authorities should be on alert for the issue, he said.

“I am sending to the authorities a question which many Danes ask themselves when they open the refrigerators in supermarkets,” Kollerup said.

“Can it really be true that prices are going up so much? Can it all be explained by the situation world markets are in or is there something else and more?”, he said.

READ ALSO: How people in Denmark are changing their energy use to keep bills down

Energy prices as well as those of food staples like butter and eggs will be kept under watch, he said.

On average, the cost of food and beverages (not including alcohol) was up 14.6 percent in July relative to last year, with the national inflation rate measured at 8.7 percent in the same month.

Price monitoring will fall under the auspices of the Business Ministry along with the Danish Competition and Consumer Authority (Konkurrence- og Forbrugerstyrelsen). Kollerup did not give details in the press statement of how prices will be monitored.

The Socialist People’s Party (Socialistisk Folkeparti, SF), an ally of the government in parliament, said it was in support of the measure.

SF last week call for authorities to look into whether business have artificially inflated prices.

“I think it makes complete sense to have this increased focus on energy and food prices because this is something every spends money on, and it has an uneven impact socially,” SF’s business spokesperson Lisbeth Bech-Nielsen said.

The spokesperson recognised that suspicion prices have been raised too much is “only anecdotal” and said “there can be good reasons” for this.

“It hits so hard for those who have the least, so it is crucial to make sure it’s only external factors that have caused (prices) to rise in this way,” she said.

Supermarket chain Coop does not see the initiative as demonstrating a lack of trust in the sector, its head of communications and analysis Lars Aarup told Ritzau.  

“It’s an excellent initiative. We support as much transparency as possible,” he said.

Business organisations have criticised Kollerup’s statement, however.

SMV Danmark, which represents small and medium-sized businesses, accused the minister of electioneering, while the Confederation of Danish Industry (Dansk Industri, DI) said that the necessary means for monitoring businesses were already in place.

Kollerup does not have “a hint of evidence” that businesses are using inflation to cover up prices hikes, SMV Danmark’s senior economist Martin Kyed said.

“On the contrary, data shows that producer prices have gone up more than consumer prices,” he said in a written comment.

DI’s political director Emil Fannikke Kiær said there was a “tone of suspecting all businesses for taking advantage of the situation”.

“We actually have a very good and tough law for price fixing, and there must be reasonable grounds for price increases. We have authorities that already control this, so there are already interventions in the toolbox that are being used,” he said.

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MONEY

Exchange rate: What are your options if you live in Denmark but have income in pound sterling?

The value of the British pound has fallen steeply against the dollar in recent days but also against the Euro – and the krone. So what should you do if you live in Denmark but have income – such as a pension, rental income or a salary – in pound sterling?

Exchange rate: What are your options if you live in Denmark but have income in pound sterling?

Exchange rates might sound like a spectacularly dull topic, but if you live in Denmark (where, naturally, your day-to-day living expenses are paid in kroner) but have income from the UK in pounds, then the movement of the international currency markets will have a major impact on the money that ends up in your pocket.

This is not an uncommon situation – Denmark-based Brits may work remotely as freelancers from British companies and be paid for invoices in pounds, while retired Brits might be receiving a British pension.

Others might have income from rental properties or investments.

So a big loss in the value of the pound against the euro – and by extension, the krone – can have a major impact on Brits in Denmark.

The most recent fall in the value of the pound was sparked by the UK government’s new mini budget and has already seen a relative recovery. 

The pound-krone exchange rate over the last month. Chart: xe.com
 
 
But while this one-time fall is spectacular, it’s also part of a longer term trend in the fall of the value of the pound, especially since Brexit, that has seen people such as foreign-based pensioners lose a big chunk of their income.
The pound-krone exchange rate over the last 10 years. Graph: xe.com

So if you have income in pounds, what are your options?

Income in kroner – obviously this isn’t an option for everyone, especially pensioners, but the best way to protect against currency exchange shocks is to make sure that you’re paid in the same currency that you spend in.

Alternatively, income in euros: the advantage of the euro in Denmark is that its value is pegged to the krone and not sensitive to exchange rate fluctuations.

For those being paid from abroad, billing in euros means you could work in any EU country – including the anglophone ones like Ireland – and get your salary in euros.

Depending on your employer, it might also be possible for you to ask to bill in euros. 

Work in Denmark – if you’re currently not working or want to switch to local currency income, then an obvious option is to take up some work in Denmark.

Depending on your work and residency status, as well as the field you work, the practicality of this option ranges wildly from one person to the next.

READ ALSO: How can you get a work permit in Denmark if you are not an EU national?

Exchange rate – if your income can only be paid in pounds, it’s crucial to ensure that you get the best exchange rate possible and that you don’t waste money on international transfer fees.

The best options here are online banks or money transfer services, which compete on the rates that they offer, so usually have the most advantageous rate.

Some online banks also have the option to set up accounts in both pounds and kroner, so that you can receive money in pounds and spend it in kroner without having to make bank transfers, which can attract fees.

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