Supermarket price hike crackdown: Greens propose profit caps on essential grocery items

A newly proposed bill would allow the state government and regulators to control how much supermarkets can profit off essential items in the latest crackdown on price hikes.

Supermarkets would be hit with profit caps on essental grocery items under a proposed bill. Picture: NCA Newswire

Supermarkets would be hit with caps on how much they can profit on grocery staples like bread and dairy under a major proposal from the Victorian Greens.

The minor party will on Tuesday release draft laws for what it calls the state’s first price control legislation in more than three decades.

The crackdown on the supermarket duopoly would give the state government of the day power to declare certain products - such as bread, fruit, vegetables and milk - as an “essential grocery item”.

The Essential Services Commission - the regulatory body - would then be able to determine how much profit supermarkets could make on certain grocery items under proposed new legislation.

The Victorian Greens have proposed the Essential Services Commission decide how much profit supermarkets could make on certain grocery items. Picture: NCA Newswire

While it would ultimately be up to the government to decide the products it deems to be essential, the Greens have flagged that bread and dairy products should be regulated in the first instance, citing “skyrocketing prices”.

But the minor party also wants a wide range of grocery items to fall under the price controls, including rice, pasta, fresh fruit and vegetables, as well as some cooking and cleaning products.

Earlier this year, the Greens failed in its bid to have the government set supermarket prices by declaring supermarkets a regulated industry.

They argued that such a plan would let the Essential Services Commission investigate, monitor and set prices.

“Essential” items under the bill could include rice, pasta, fruit, vegetables and dairy products. Picture: AFP

The Victorian government has repeatedly said that competition and consumer law is within the federal government’s remit, pointing towards a federal inquiry into supermarket prices.

But deputy Greens leader and Treasury spokesman Sam Hibbins said the Victorian government has the power to stop supermarket price gouging, but are refusing to do so.

“The Victorian government should use the powers it has – that previous Labor state governments have used – to stop the supermarkets from price gouging,” Mr Hibbins said.

“In a cost of living crisis, people are struggling to afford food because profiteering supermarkets are jacking up their prices.

“Every time someone goes into a supermarket they are faced with unfair price hikes on basics like bread and dairy. It is next to impossible to do a cheap shop anymore. This is all happening while supermarkets are posting massive profits and increasing their profit margins.

“Labor is refusing to take on the supermarket duopoly and continues to wash its hands of responsibility, but this bill shows how it can be done.”

The proposed Bill, which is currently only in draft form, will be released on Tuesday.

The Greens said they will seek feedback from experts and the wider community before formally introducing it into parliament at a later date.

The Greens have previously called for the government to create a ministerial portfolio for fair prices.

A Victorian government spokesman said: “The Greens political party knows that competition policy is a matter for the Federal Government and the ACCC as the relevant Commonwealth body for economic regulation.”

“While the Greens waste time with cheap political stunts, we’re getting on with delivering real policies to help Victorians with the cost of living - our $400 School Saving Bonus will help around 700,000 students with uniforms, camps, excursions and sporting events at school.”