Federal probe into supermarket price-gouging claims

A former federal minister will lead a review into the supermarket sector as claims intensify of price gouging by big chains during a cost-of-living crisis.

Jan 10, 2024, updated Jan 10, 2024
Photo: Getty

Photo: Getty

Craig Emerson will lead a probe into Australia’s major supermarkets amid accusations of price gouging in a cost-of-living crisis.

The federal government will on Wednesday announce the former Labor minister will head the Food and Grocery Code of Conduct review into Coles, Woolworths, Aldi and Metcash, which operates IGA.

Amid growing political pressure over rising grocery prices, the government will also release one part of the review and its response on Wednesday.

Emerson served as competition, trade and small business minister between 2007 and 2013 and is well known for singing a parody of the Skyhooks’ 1974 hit Horror Movie at a press conference on the carbon tax.

The review, announced in October, is expected to examine whether the supermarket industry code is helping improve standards of business behaviour in the sector and may lead the government to strengthen consumer rights.

The code regulates the conduct of retailers and wholesalers towards suppliers.

Prime Minister Anthony Albanese said in a statement the findings could lead to government intervention.

It comes as farmers are urging customers not to blame them for soaring grocery prices.

There are growing concerns about the gap between what farmers earn and the prices charged by supermarkets as the grocery giants posted billion-dollar profits in 2023.

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Coles posted $10.25 billion in first-quarter sales in 2023, a 3.6 per cent rise compared to the first quarter of the 2022 financial year, while Woolworths’ revenue grew by 5.3 per cent for a total of $17.2 billion.

Albanese said supermarkets had a duty to “make sure they’re providing affordable options for all Australians, especially when they’re making savings on their own costs”.

“We have been clear – if the price for meat and fruit and vegetables is going down at the farm gate then families should be seeing cheaper prices on supermarket shelves too.

“As inflation continues to moderate and as businesses see some of their costs reduce, we expect to see these benefits flow directly to consumers and households.”

Queensland Premier Steven Miles last week wrote to the supermarkets about the “widening gap between the prices farmers receive for their produce and the prices customers pay at the checkout in your supermarkets”.

Independent MP David Pocock said lack of competition had a “devastating effect” on farmers and suggested supermarkets display the farm gate price on shelves.

“It would be a real reminder for Australians of how little farmers are getting in some cases and can potentially (be) an incentive for the major supermarkets to work with their farmers,” he told ABC radio on Tuesday.

“It comes to the government and the parliament to ensure that there are the right laws in place (so) that there is more choice and we see smaller players able to enter the market and not just then be snapped up by these bigger companies who are making big profits while a lot of Australians are really struggling.

“This is something that we need to deal with, but this is not a new issue.”

This story first appeared in our sister publication The New Daily, with reporting from AAP.

Topics: supermarkets
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