Principles abandoned: Liberals under attack by Labor

Labor has mocked Peter Dutton’s forced divestiture plan as an abrogation of Liberal Party principles, accusing the opposition of outsourcing policy development to the Nationals.

Anthony Albanese in question time on Wednesday. Picture: NewsWire / Martin Ollman

Labor has mocked Peter Dutton’s forced divestiture plan as an abrogation of Liberal Party principles, accusing the opposition of outsourcing policy development to the Nationals, with competition tsar Graeme Samuel branding the position a populist “disgrace”.

Anthony Albanese attacked the Coalition in parliament on Wednesday by arguing its plan for government-owned nuclear power stations and new powers to break up supermarket chains ­represented an embrace of ideals further to the left than the Labor Party.

The Prime Minister warned that the new forced divestiture policy for larger grocery and hardware retailers risked greater market concentration, less competition and upward pressure on prices for customers.

“(Former Liberal prime minister Robert) Menzies tried to ban the Communist Party; they want to adopt the Communist Party model,” Mr Albanese told parliament, gesturing at the opposition benches. “They want publicly owned energy through nuclear energy … and now they want, one would assume, publicly owned supermarkets.

“It’s not so much a super­market policy as a super-Marxist policy. Now, one thing that all of the experts agree on to push up prices would be divestiture – a policy that’s supported by the Greens, the Nationals before and, now, supported by the Liberals as well.”

Mr Albanese questioned who would end up buying supermarkets under the plan, saying: “If Coles has to sell, guess who’ll buy it? Maybe Woolworths.”

The parliamentary attack came after several Coalition MPs raised questions or expressed concerns over the proposed ­divestiture policy in Tuesday’s joint-party room meeting, with Nationals leader David Littleproud aiming to introduce the shake-up in a private member’s bill when parliament returns after the winter break.

Victorian Liberal Keith Wolahan admitted to having a “complex” debate over the proposal during Tuesday’s party room meeting. “I wouldn’t be doing my job if I walked into a debate and ticked off that everything was fine,” he told Sky News. “Of course we’re going to scrutinise the details of a particular policy.”

Mr Littleproud led the defence of the policy, arguing that divestiture powers were “only used as a last resort” but had been implemented in the US, UK and Canada.

“What we’ve done is put safeguards around this,” he told Sky News. “They are used and determined by a court, not by politicians. If they are determined by a court to take place, then it can’t have a negative impact on competition. It can’t have a reduction in employment or cause a reduction in employment.”

Mr Littleproud rejected arguments that the changes would push up prices, declaring there was “no increase in the regulatory burden on the supermarkets” and “for them to say this is going to increase costs is absurd”.

The Liberal deputy chair of the economics committee, Garth Hamilton, said the proposal – largely devised by Treasury spokesman Angus Taylor – was in line with comments by Australian Competition & Consumer Commission chair Gina Cass-Gottlieb, who said divestiture powers would be “useful to have in the toolkit”. However, former ACCC chair Graeme Samuel said the Coalition’s plans were a “disgrace” and an exercise in “populist politics which has gone even lower than I thought it could”.

Mr Samuel said the policy was misconstrued and based on confused and incorrect views of competition laws.

A former treasurer of the Liberal Party’s Victorian division, Mr Samuel said the party’s recent proposals were “not the sort of policies I would expect from the Liberal Party I once supported”.

John-Paul Drake, director of Drakes Supermarkets, which operates over 60 stores, said any move to open up competition in the sector was good.

“Ultimately, as a business if you’re not doing anything wrong or acting unethically, then you have nothing to worry about with this proposal,” Mr Drake said. “But if you’re doing things like land banking with no intent to build a store, or paying over the odds in rent to muscle out smaller players, I think someone does need to stand up to the market bullies and say enough is enough. I would welcome any measure put in place that allows more scrutiny into the way the Duopoly operates.”

Australian Chamber of Commerce and Industry chief executive Andrew McKellar said “farmers and suppliers should get a fair deal from supermarkets, and safeguards must be in place – but this is not the preferred approach”.

“Supermarkets need economies of scale to be competitive and provide consumers with the lowest possible price,’ he said.

Economist Chris Richardson said while there were “genuine issues” with competition in the supermarket sector, he criticised the Coalition’s policy as “not credible”.

Energy Minister Chris Bowen said the Coalition’s nuclear energy and forced divestiture policies had one thing in common: “they were designed by the National Party”.

“The once great Liberal Party of Australia has vacated the field for the National Party and when you hear the National Party’s writing the economic policy you should be very worried,” Mr Bowen said.

National Farmers Federation president David Jochinke said that, while the group did not have a position on divestiture, it was “committed to working with our members to understand the Coalition’s proposal”.

“It is essential any significant shifts in Australian competition policy are carefully considered to fully comprehend potential risks for producers, consumers, and the broader supply chain,” Mr Jochinke said.

Additional reporting: Matt Bell