/ 09 April 2024

Double-checking your docket


The Squiz

The Albanese Government has thrown its in-principle support behind new fines for Aussie supermarket retailers who engage in anti-competitive behaviour. That’s one of 8 key recommendations made by former Labor Minister/economist Craig Emerson in his interim review of the voluntary Food and Grocery Code of Conduct. PM Anthony Albanese called the provisional findings a “very strong” start and said the process is all about “how we make our supermarkets as competitive as they can be so that Australians get the best deal possible”.

Tell me more…

Emerson has recommended that the supermarkets fork out 10% of their annual revenue if they’re found to have mistreated suppliers and farmers. To give you a sense of what that would look like, Coles made more than $35 billion in sales last financial year, so that sort of fine would be a lot… Making the code mandatory – another one of Emerson’s recommendations – would force the likes of Coles, Woolies, IGA and Aldi to play by the rules. As for how we got here, the review was prompted by suppliers claiming large discrepancies in what they were being paid versus the retailers’ prices – claims the retailers reject. But Treasurer Jim Chalmers says the idea is to prevent suppliers from being “dudded” by the supermarkets, and “a big motivation is to put downward pressure on prices” for consumers. 

So we’ll see cheaper grocery bills?

Albanese is confident… He says the current code “essentially is run by the same businesses that are being complained about” so an overhaul would see “a change in the power relationship”. Coalition leader Peter Dutton disagrees – he said the recommendations aren’t “the solution consumers are looking for”. And the Nationals and Greens aren’t pleased that Emerson rejected their suggestion to allow the Australian Competition and Consumer Commission (which is running a different supermarket review) to break up retailers if they do the wrong thing – he reckons that’s too “heavy-handed”. As for the retailers, they will get their say when Emerson’s report goes through an industry consultation process before the final report is handed down on 30 June. Stay tuned…

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