Supermarket probes expose cost of living pain
Supermarkets are being probed over their pricing and other behaviour. The Emerson report says they should be forced to behave or be fined.
Supermarkets are being probed over their pricing and other behaviour. The Food and Grocery Code of Conduct Review 2023–24 - Interim Report, known as the Emmerson report, says they should be forced to behave or be fined.
A mandatory grocery code of conduct, with the threat of large fines for breaches, has been proposed in an interim report into supermarket prices chaired by former Labor minister Craig Emerson.
Soon after the release of the interim report, on 8 April, the major supermarkets, Woolworths and Coles, agreed to the proposal, but they have asked for it to be expanded to include competitors including Bunnings, Chemist Warehouse, Costco, and Amazon.
The Federal Government has supported the recommendations, which include fines of up to 10% of annual turnover for retailers that breach the code and strengthen policing powers for the industry regulators.
The government says it will formally respond following a period of public feedback to the interim report.
Dr Emerson is expected to release a full report by the end of June.
The supermarkets are also subject to an inquiry by the Australian Competition and Consumer Commission (ACCC), which began earlier this year following a flood of claims that the supermarkets were in a monopoly situation and gouging the public at the checkout.
The consumer regulator is looking into the supermarkets’ approach to setting prices, the role of small and independent retailers (including those in regional and remote areas), and the impact of increased data collection and other technological developments.
Public submissions to the inquiry have closed. Those submissions received already have exposed how hard it is for many Australians, especially for younger Australians and lower income households (including many seniors) to make ends meet in these inflationary times.
So far, it’s found low-income households are spending up to one-quarter of their net income on groceries.
Households are reducing their grocery bills by spending more time shopping around for savings, substituting fresh food with frozen, and cutting back on non-essential items.
Some people have also reported skipping meals or sacrificing meals to feed their children properly.
Over 13,000 consumers responded to the survey, which closed on 2 April.
“Survey responses give us a very important insight into consumers’ everyday experience of the sector that will complement our investigation into the pricing practices of the supermarkets,” ACCC Deputy Chair Mick Keogh said.
The ACCC says the public responses have helped it connect with what average consumers are experiencing, helping it identify the right issues that need to be explored more deeply.
Findings from the consumer survey will be included as part of the ACCC’s interim report, due by the end of August.
The ACCC says it is seeking to deepen its understanding of how Australian consumers shop for groceries, particularly since the Covid pandemic and recent sharp increases in the cost of living.
The ACCC also wants to understand what current supermarket practices concern consumers the most.
It says the survey results will inform its assessment of “competitive dynamics in the sector and help to identify issues for further exploration as part of the Supermarkets Inquiry”.
“A clear theme in the survey responses so far is that consumers consider the price of groceries to be a major factor in the cost-of-living crisis,” Mr Keogh said.
“Grocery shopping is an essential in everyone’s life, and we strongly encourage Australians to share their experiences with us.”
