Supermarket prices: “Major reform needed” Senate committee finds

A Senate select committee into supermarket prices has found farmers are being squeezed for the benefit of the nation’s biggest retailers.

Coles chief executive Leah Weckert appears before the Senate Select Committee on Supermarket Prices at Parliament House in Canberra in April. Picture: Martin Ollman

Major reform of the supermarket sector is needed including introducing forced divestiture powers, to stop Australia’s major retailers from squeezing small farmers “to constantly provide more for less, risking their livelihoods and those of the people around them”, a Senate inquiry has found.

In its final report released Tuesday, the federal government’s Senate committee on supermarket prices has called for an overhaul of Australia’s supermarket sector and competition policy.

In addition to divestiture powers when a supermarket has been found to have misused its market power or acted unconscionably, the committee recommended wide-ranging reforms including prohibiting charging excessive prices, making the Food and Grocery Code mandatory by September, and creating a new commission on prices and competition.

Government and Industry Relations Manager at Coles, Vicki Bon and CEO of Coles Supermarkets, Leah Weckert appear before the Senate Select Committee on Supermarket Prices at Parliament House in Canberra. Picture: Martin Ollman

“The supermarket duopoly in this country is operating without proper oversight and restraint, thanks to outdated and ineffectual consumer and competition law,” Senator Nick McKim said.

The committee heard from farmers who struggled to make ends meet when they haven’t been given a price increase in 15 years.

“We heard that farmers fear retribution for trying to negotiate on a level playing field. The committee heard again and again of the numbers of smaller farmers who are leaving the industry, saying ‘there are easier ways to lose money’. Not only does this impact those individual farming families, but it also puts Australia’s food security at risk. This is not okay in a wealthy nation like Australia,” Senator McKim said.

Fourteen recommendations have been made to “restore oversight and restraint” to the sector that is widely seen as profiteering during a cost of living crisis.

The National Farmers’ Federation’s horticulture council president Jolyon Burnett said the committee’s report revealed the “widespread appalling treatment of fresh produce suppliers”.

“The council has welcomed recommendations by the select committee to dramatically tighten provisions within the Food and Grocery Code and attach significant penalties for any breaches,” he said.