Employer blast ACTU’s ‘predetermined’ price-gouging probe

Former competition tsar Allan Fels will chair an ACTU inquiry into alleged ‘price gouging by big business’.

Professor Allan Fels. Picture: NCA NewsWire / Ian Currie

Employers have attacked a proposed ACTU inquiry into price gouging by big business, accusing the union movement of pre-determining an outcome before the probe has started.

The ACTU has said former competition tsar Allan Fels, who will chair the inquiry, is well qualified to produce practical, effective measures to curb price gouging.

ACTU secretary Sally McManus on Wednesday said she was delighted Professor Fels, a former Australian Competition & Consumer Commission chairman, had agreed to head the inquiry, which will take submissions and hold hearings across the country.

“I am pleased to have been asked to chair this inquiry, which echoes the beginnings of my ­career at the Price Justification Tribunal,” Professor Fels said.

“It’s time to take a serious look at what is a serious problem: does Australia have a price-gouging problem and if so, to what extent?

“In a cost-of-living crisis, price gouging has real consequences. Those affected by this deserve an opportunity to express themselves alongside debate on potential policy solutions.”

Ms McManus said: “The impacts of the cost of purchasing our most basic goods shouldn’t be underestimated. Working people are feeling this every day at the checkouts and when the bills come through the door.

“It’s only right we take a look to see what’s fuelling these rises and what can be done about it.”

The inquiry will take submissions from the public and from experts and organisations concerned with the potential impacts of price gouging, and what can be done to address it.

The inquiry will make findings and may make recommendations to the ACTU on policy solutions to limit future price gouging.

Australian Chamber of Commerce and Industry chief executive Andrew McKellar said the idea of the union movement holding an inquiry when it had already determined its conclusion was ­ludicrous.

“The ACTU is on record of making many unsubstantiated claims of unjustified, inflation-fuelling price increases, but the evidence simply does not stack up,” he said. “The union movement is not known for its tolerance of a diversity of opinion.

“How will it accept any outcome other than that which it wants. The experts at Treasury and the Reserve Bank have already examined claims of profits causing inflation and rejected it.”

Australian Industry Group chief executive Innes Willox said his organisation’s research was in line with Reserve Bank findings that “changes in domestic profit margins have not been a significant independent cause of the increase in aggregate CPI inflation”.

“The ACTU’s price-gouging rhetoric, among many of its other claims, is based on myths, misstatements and misconceptions,” he said.

ACOSS chief executive Cassandra Goldie said experts agreed that one cause of excessive inflation was businesses with market power being unwilling to reduce profit margins as inflation took hold and business costs rose.

“People on low incomes, though, have had to bear cuts in real wages and grossly inadequate income supports failing to cover the costs of essentials,” she said.

“We face the real possibility of an economic downturn over the next 12 months.

“We accept inflation has put many businesses under pressure but the burden of high inflation should be fairly shared, not shifted to lower-paid workers and people on low fixed incomes relying on income support. People should not be sacrificed to unemployment and poverty to control inflation.”