Senate Inquiry into Supermarket Food Pricing Announced
Industry groups including the National Farmers Federation, are welcoming an inquiry headed by The Greens that will “scrutinise the impact of market concentration on food prices and the pattern of pricing strategies employed by the supermarket duopoly.”
Senator Nick McKim, Greens economic justice spokesperson has accused Coles and Woolworths of price gouging during the cost of living crisis. “For too long the big supermarkets have had too much market power. This allows them to dictate prices and terms that are hitting people hard. It’s time to smash the duopoly. Coles and Woolworths are making billions in profits because they feel that they can overcharge people without repercussions. It needs to end. We want CEOs to justify their decisions in a public hearing.”
The Senate inquiry will be spearheaded by the Greens and will investigate nine different terms of reference including:
The effect of market concentration and the exercise of corporate power on the price of food and groceries;
The pattern of price setting between the two major supermarket chains;
Rising supermarket profits and the large increase in price of essential items;
The prevalence of opportunistic pricing, price mark-ups and discounts that aren’t discounts;
The contribution of home brand products to the concentration of corporate power;
The use of technology and automation to extract cost-savings from consumers and employees;
Improvements to the regulatory framework to deliver lower prices for food and groceries;
Frameworks to protect suppliers when interacting with the major supermarkets; and
Any other related matters.
David Jochinke, the president of the National Farmers Federation said “Australia has one of the most concentrated food supply chains in the world and this imbalance in market power is hurting both farmers and consumers. We know what Australians are paying at the checkout, and we know what we’re receiving as farmers - but who clips the ticket in the middle is shrouded in secrecy. We’d like to see a lot more transparency.”
But, Mr Jochinke would also like to make sure that this inquiry does not distract from the Government's broader competition reform agenda. “Competition is a major issue in our supply chains and it’s a drag on the productivity for the broader economy. Shining a light on how supermarkets use their market power is a positive step. But it can’t become a reason to delay action on a broader competition policy reform.”
