Senator Nick McKim’s comical Woolie’s ‘prosecution’ is an important example of how not to do it | David Penberthy
Nick McKim’s antics did a disservice to the public when more valuable questions should be directed at both Woolworths and Coles, writes David Penberthy.
It takes special genius in the current climate to make anyone sympathise with the chief executive of one of Australia’s big two supermarket chains.
Arise Greens Senator Nick McKim, who made both an oaf and a halfwit of himself while “prosecuting” outgoing Woolworths CEO Brad Banducci before Senate estimates this week.
I am not sure if Senator McKim was modelling himself on Tom Cruise in A Few Good Men or the Grand Jury scene in The Godfather II where Michael Corleone was put through his paces.
If it was his intent to create a powerful court room drama, he ended up starring in his own comedy.
McKim’s Nuremberg stylings reached a heady crescendo when he threatened to have the Woolworths boss jailed for failing to answer his question, despite the fact that his question was largely missing the mark.
Reminding us all that Parliament is there for two reasons – to make laws, and to give people who I don’t think would ever succeed in business something to do – McKim launched a weird rant about “return on equity”, figuring this to be some gotcha moment which would expose Banducci and Woolies for the price-gougers they are.
When Banducci tried nobly and politely to explain that no such measure was used to determine the success of the business, McKim accused him (his words) of “bulls**ting” and warned him that he might face six months in the clink if the insubordination continued.
By the end of it all it was hard to see whether in McKim’s mind it was Woolworths or capitalism itself that was on trial.
It was not the first time a group of politicians has entered one of these trumped-up estimates hearings all guns blazing only to have the cork pop out in their own face.
The benchmark for this remains the master class of Kerry Packer, which was like watching a T-Rex being tormented by a group of field mice.
McKim’s antics did a disservice to the Australian public at a time when other, more valuable questions should be directed at both Woolworths and Coles.
Chief among these goes to their treatment of primary producers, where the big two can effectively decide what the agreed wholesale price of a product is, regardless of how much it is costing the farmers to grow.
For consumers, our key question goes to greater transparency around pricing, at a time when inflation seems to be used as a foil to justify prices which are often uncannily similar at either of these two megastores.
But Australia needs to be careful how it goes about all this. Senator McKim provides a useful example of how not to do it.
We should think twice about yearning for a world where supermarket giants don’t make any significant profits at all.
It is no different from the banking sector.
Surely the only thing worse than having four big banks which routinely make heaps of money is having a bunch of banks making barely any at all - or worse, incurring losses with the job falling to the taxpayers to step in and save businesses, households and the economy from hitting the wall.
Largely off the back of one Four Corners documentary – a good one, and exquisitely timed amid the cost of living squeeze – it seems there are no ideas too extreme or draconian when it comes to how big business should be controlled.
There is talk of divestiture laws which could be used to break up bigger companies, as well as compelling stores such as Coles and Woolworths to get rid of some of their stores to increase competition.
It is hard to see how these ideas would necessarily work, and whether they could in fact make life harder for consumers.
A vast, cashed-up company is better placed to tolerate some in its network of stores providing slim returns.
If you put those lesser-performing stores on the market, they would be unattractive to new buyers based on their limited profits.
You might end up with fewer stores as a result, further concentrating power in the hands of the big two.
By my understanding of all this, it wouldn’t be the Parliament itself but the Federal Court via a request from the consumer watchdog the ACCC which would decide whether such laws should be used anyway.
That is of some relief as it puts it into the sober-minded hands of the judiciary rather than the populist setting of the Parliament.
But we should tread carefully on all this when it is populist pollies such as Nick McKim who are leading the charge.
More damning than the questions he did ask were the ones he didn’t ask.
A couple of other inputs come to mind when considering the surge in supermarket prices. Of these, the biggest would be whether unprecedented power prices thanks to renewables-or-die energy policies are pushing up the cost of doing business.
Or whether paying teenage boys triple time on a weekend to replenish the shelves with cans of sweetcorn is also playing a role.
Had Nick McKim considered these questions, he might have addressed them not to Mr Banducci, but to himself and his parliamentary colleagues.
It’s funny, because only a few weeks ago I wrote a piece saying Mr Banducci had to go from Woolies on account of his woeful handling of the Australia Day fiasco, his poor hit-out on Four Corners, and the general sense that he was more interested in trendy causes than helping the punters at the checkout.
Now I kind of admire him for loyally exiting his company as a human shield in the face of Nick McKim’s flailing questioning.
As for the kind of supermarket Senator McKim would deliver, based on his business pedigree, and the acumen he showed the other day, I reckon it would look a bit like the ones in the old Soviet Union.
Ideologically pure through the absence of profit motive, and always out of bread.
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Originally published as Senator Nick McKim’s comical Woolie’s ‘prosecution’ is an important example of how not to do it | David Penberthy
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