Jersey has announced a major investigation into the difference between food prices in the island and the UK.

Competition watchdog the Jersey Competition Regulatory Authority, which has the power to demand entry to premises to look for evidence, is to be asked to look into profit margins on food by the economic development minister Alan Maclean.

Maclean said that some differences, because of transport costs, economies of scale and higher operating costs, were justified, but he still wants a full review to look at the entire supply chain.

Food prices went up by 23 per cent between December 2007 and March this year, well ahead of the average price inflation. The JCRA is in the final stages of a major report on heating oil and petrol prices, which is due before the end of May.

The authority has been given the power to demand evidence from companies after some refused to hand the over voluntarily. Similar powers were used for a review of the motor trade last June.

Maclean