ANDREW LEIGH:
Well, good morning everyone. Thank you very much for coming along on a beautiful crisp Canberra morning. My name is Andrew Leigh, the Assistant Minister for Competition, Charities, Treasury and Employment.
Information is power and the Albanese government is putting that power in the hands of consumers. With today’s CHOICE price monitoring report on the cheapest supermarket prices. We know many Australians are facing cost‑of‑living pressure. And we know that CHOICE has a strong track record of carrying out these price monitoring surveys. But in the past, the surveys have done been done every 2 years, and some of the information has been behind the paywall, available to CHOICE subscribers only. What’s different about the report being released today is that it’s available to everyone and will be carried out every 3 months, with the next report coming down before the end of September.
This matters because Australian shoppers want to know where they can get the best deal. As you follow these CHOICE price monitoring reports, you’re able not only to get the best deal for your family, but also to put more competitive pressure on the Australian supermarkets. Australia’s grocery sector is one of the most concentrated in the world, with a significant market share for the 2 biggest players. So it’s only fair that we have considerable price scrutiny on the prices of groceries being paid by Australian shoppers.
This is just part of what we’re doing to make sure that Australian shoppers get a better deal and our supermarkets are under appropriate competitive pressure. We’ve tasked Craig Emerson, the former competition minister, with reviewing the Food and Grocery Code of Conduct to see whether a code that was set up under the Liberals and Nationals to be voluntary should now be made mandatory. We’ll be bringing down Craig’s final report before the end of the month. We’ve asked the Australian Competition and Consumer Commission to do a deep dive into supermarkets and see what needs to be reformed. Looking at issues around loyalty cards and like, to ensure that shoppers get the best deal, and that work will be released, at least the interim report, by the end of August. And we’ve got the Competition Taskforce a crack team within Treasury focused on cost‑of‑living measures.
This is part of the work that the Albanese government is doing across the board to ensure that we have a more competitive and dynamic Australian economy, aided by work such as the House Economics Committee Report, chaired by Daniel Mulino, which came down recently with a really important report. More competition means a better deal for consumers, a fairer deal for farmers, and more dynamism in the economy for workers.
I just want to make one more statement about a new announcement we’ve made today around the Australian Criminal Justice Data Asset, which will provide better information on domestic and family violence offenders and victims. We’ve been working closely through the Australian Bureau of Statistics with the Department of Social Services, and states and territories. Labor has a plan to end family and domestic violence within a generation. As part of that plan, we need to get better data on family and domestic violence. This new asset will contain information around perpetrators, around recidivism, and around contact with the criminal justice system. We can’t deal with the problem fully without having good information. And this new Australian Criminal Justice Data Asset will allow us to better target our resources in eliminating domestic and family violence within a generation. Happy to take questions on either of those.
JOURNALIST:
This report shows the Woolworths and Coles costs about the same and Aldi is 25 per cent cheaper. I don’t think that’s new information. Really to anyone? How is this helpful to consumers?
LEIGH:
Well, you’re able to see the scale of the difference and that difference does vary across jurisdictions. I certainly know many people who were surprised by the gap between Aldi and the major supermarkets. People might have thought Aldi was cheaper, but 25 per cent cheaper comes as a as a surprise to many people. It’s also not true the 2 majors are exactly the same. Yes, they do monitor each other closely. But I know plenty of shoppers who are pretty happy about getting a couple of per cent off and you do see a couple of per cent difference between the majors in certain jurisdictions. It also points to the impact across jurisdictions that don’t have Aldi – the Northern Territory and Tasmania. This has a significant impact on the grocery prices those shoppers pay.
JOURNALIST:
Both the Woolworths and Coles submissions to Senate inquiries on price gouging say their profit margins are something like 8 cents in the dollar. So there’s a 25 per cent difference between Aldi and Woolworths and Coles. Are the big major supermarkets providing accurate information to the parliamentary inquiry?
LEIGH:
That’s going to be a question for them to answer. Certainly this information suggests that there is significant gains for shoppers in shopping around. I know we’ve seen a rise in split‑basket shopping during the last couple of years as households have felt cost‑of‑living pressure. And so the rise of split basket‑shopping is going to put more competitive pressure on the majors. That’s a good thing. They have a larger market share than they do in many other comparable countries. It’s appropriate that we have put more information in the hands of consumers. What’s really valuable about this information is it’s a single number. It’s sort of a grocery Olympics, if you like, which encourages all the supermarkets to try and do a better job for consumers when the next survey is revealed in September.
JOURNALIST:
The recommendations in Craig Emerson’s report, which you said a final version will be released later this month, are unlikely to change because they relate to mandating the Grocery Code. Do you expect to see legislation for that in parliament and passed in this term of government?
LEIGH:
Well as you know the current code runs out early next year so it is imperative that we look at how to proceed. The government is certainly minded to adopt Craig Emerson’s recommendations, but we will be bringing down our response alongside the final report by the end of the month.
JOURNALIST:
You have legislation that is currently in the parliament, I asked you to speak about status of those who got the response from a PMO, which is a non‑answer, because if you don’t know the status of the legislation or the PMO won’t let you say the status quo.
LEIGH:
So the 2 bills you referred to are now in the Senate. As you well know, Ron, having worked in this building, the management of legislation in the Senate tends to be taken up by the Senate team. I’m confident we’ll work constructively with the crossbench in order to get those pieces of legislation passed.
JOURNALIST:
In the Northern Territory and Tasmania, it’s clear that the lack of options is making people pay more for groceries. Does the government have a responsibility to make sure that there is more competition in the market?
LEIGH:
I’m sure the shoppers in those markets would welcome the entry of Aldi. I know I’ve spoken to a range of my federal colleagues who would be keen to see another low‑price competitor operating in those markets to benefit the shoppers in those areas.
JOURNALIST:
How do you make that happen?
LEIGH:
Part of its planning and zoning challenge. Part of it is also the commercial decision that Aldi head office will make. But I know my federal colleagues are as concerned as I am at seeing the higher prices that shoppers in the Northern Territory and Tasmania end up paying as a result of not having that Aldi option.
JOURNALIST:
Does the analysis take into account the cost of logistics going to those jurisdiction doesn’t just take us straight, ‘This coffee has made up this basket with the coffee as well’?
LEIGH:
It is simply looking at the prices paid on the supermarket shelves.
JOURNALIST:
So it doesn’t take account of elements of the Northern Territory being very far away from any hubs, or in Tasmania having to ship, or anything like that?
LEIGH:
It’s simply looking at the prices on the shelves.
JOURNALIST:
Do you think that’s an accurate reflection then to compare Tasmania and the Northern Territory with other jurisdictions where it doesn’t take into account shipping costs?
LEIGH:
Well, it’s an accurate reflection of the prices on the supermarket shelves. And if your point is that we should expect to see large differences for the major supermarkets in those jurisdictions, that’s not what the results show. The results actually show fairly close grocery prices in Tasmania and the Northern Territory for Coles and Woolworths. The big difference in those jurisdictions is the lack of an Aldi. Any other questions?
JOURNALIST:
I mean, just the numbers of the report, it’s almost 70 bucks to get only a few items from the supermarket. Surely that’s concerning in itself.
LEIGH:
Many Australians feeling the price pressures which are caused predominantly by supply chain constraints and the war in Ukraine. And the impact of interest rate rises is squeezing households with a mortgage. I know many households will be looking at this carefully. They won’t be pooh‑poohing differences of $1 or $2. That is going to impact the shopping decisions of many Australians, as Australians look to stretch the household budget further.
JOURNALIST:
Is there anything else we can do to bring those prices down?
LEIGH:
We’ve certainly worked on issues of supply chain logistics. I’ve referred also to the work that we’re doing in tasking the Australian Competition and Consumer Commission to look at whether they can improve supermarket competition in this country. I’ve been banging on about competition in across a whole range of markets for the better part of a decade now. We have too many markets dominated by too few firms. We need a more competitive and dynamic Australian economy. That’s the whole purpose of the Competition Taskforce. We are talking today about a portion of that challenge in supermarket concentration, but there’s much more work to be done right across the economy.
JOURNALIST:
Is there anything you can do to incentivise Aldi to enter the Northern Territory or Tasmania?
LEIGH:
I think that primarily would be a matter for the state and territory jurisdictions. But certainly these reports show what a large benefit there would be to people in those communities that were out into those markets.
JOURNALIST:
So you want more competition? Will you consider divestiture powers?
LEIGH:
Divestiture powers where they exist in other countries are very rarely used. We have them in energy, I don’t think anyone’s seriously talking about using them in energy. Our main focus here is on practical policies that make a real difference. We’ve announced this year the biggest shake up in mergers in 50 years. We’re working on the issue of non‑compete clauses which constrain one in 5 workers from moving to a better paying job. We’re revitalising National Competition Policy for the first time in a generation, and working with states and territories on cost‑of‑living measures. These are the practical policies we are pursuing in order to ensure that consumers and workers get a better deal.