FRAN KELLY:
Aldi is cheaper than the 2 major supermarket chains. Fans, did you get that? Aldi is the cheapest, cheaper than Coles, cheaper than Woolies. The first comprehensive survey by CHOICE, commissioned by the federal government as part of its inquiry into competition within the supermarket sector, or the lack of it, has confirmed that Aldi is the cheapest by a whopping 25 per cent. Mind you, in many suburbs across Sydney, there is no Aldi within cooee, of course. So, that leaves you with Coles and Woolies and CHOICE found that their basket of goods was about a dollar apart. Andrew Leigh is the Federal Assistant Minister for Competition. Andrew Leigh, welcome to Mornings.
ANDREW LEIGH:
Thanks, Fran. Great to be with you.
KELLY:
Andrew Leigh, I could have told you Aldi was cheaper than the Coles and Woolies, but what do you take from this first CHOICE quarterly report?
LEIGH:
You could have told me they were cheaper, but could you tell me they were 25 per cent cheaper? That for many people has been one of the surprising factors out of the CHOICE price monitoring report. The other factor is some of the differences across jurisdictions. In Sydney, for example, Woolworths is the cheapest supermarket, in Melbourne, it’s Coles and so that’s also useful information for consumers.
KELLY:
Just on Coles and Woolies. And I mentioned it there at the start, the basket of goods according to CHOICE was about a dollar apart between the 2 majors. Does that make you wonder, does it make you suspicious that they’re not really trying to compete with each other?
LEIGH:
Well, we know they keep very close tabs on one another’s prices, Fran. What’s important with this price monitoring report is now that they’re getting more pressure from Aldi, hopefully they’ll be delivering better prices. We need information in the hands of consumers, information is power. And by funding these quarterly CHOICE monitoring price monitoring reports, we ensure that Australian consumers have better information about where to get the best deal.
KELLY:
Well, yeah, but one of the reasons why Coles and Woolworths probably won’t be forced to deliver better prices, even though CHOICE finds that Aldi is so much cheaper, is that a lot of people don’t have the option of Aldi. I mean, some, the Northern Territory, I think, doesn’t have Aldi at all and many people don’t have Aldi anywhere near them.
LEIGH:
That is one of the notable factors of the report. The Northern Territory and Tasmania, which don’t have Aldi, end up paying higher average shopping prices because they don’t have access to that cheaper alternative.
KELLY:
So, what can you do about that?
LEIGH:
Well, it’s partly an issue of planning and zoning for state and territory governments, partly a corporate decision for Aldi head office, but we do know the benefits that competition brings. This is just one market and an illustration of the broad principle that the Albanese Government has been banging on about for a long time, about the importance of getting more competition in order to get a better deal for consumers, a better deal for workers, a better deal for suppliers.
KELLY:
You have been banging on about this and we are expecting, I think, the final report from the federal government’s review into the Food and Grocery Code of Conduct any day now. The interim report a few months ago suggested compulsory regulations on how the supermarkets have to deal with their suppliers with big fines for price gouging and manipulation. Is that what is going to come out of this final report? Will the government buy into that recommendation?
LEIGH:
Well, we know that the mandatory code will be a recommendation of the final report because Craig Emerson, in his interim report said that that was a recommendation that wouldn’t change.
KELLY:
And is that a good idea, do you think?
LEIGH:
It’s certainly something we’re looking at very seriously. The Liberals and Nationals set up the Food and Grocery Code as a voluntary code without any penalties. We’re looking now at whether it needs to be toughened up to be a mandatory code. And we’ll announce our government response as we bring down Craig Emerson’s report. He’s a terrific policy economist, one of the brightest minds in the country on competition issues, and somebody who we’re very fortunate to have working on this issue. Alongside that, we’ve got the ACCC’s inquiry into supermarkets, which will report its interim report findings in August.
KELLY:
Ok, so the man – sorry to interrupt you then. The mandatory code is about how the big supermarket chains or all of them really deal with their suppliers. Is that going to necessarily do anything about the competition or lack of it in the supermarket shelves for the consumer?
LEIGH:
Well, look at both sides of the question. Economists talk about monopoly power, which is how big firms use their market power on consumers. And economists talk about monopsony power, which is how they use that power on workers and suppliers. We’re focused in the Food and Grocery Code on some of that monopsony power and how farmers have found themselves squeezed by the supermarket duopoly. Another aspect of that is the work we’re doing on non‑compete clauses, the way in which large firms are able to prevent workers from moving to a better job. So, a lack of competition, a lack of economic dynamism has been holding the economy back, may well be one of the reasons why under the Liberals we had the worst decade of productivity growth in the post war era. We’ve got to get more productivity growth, Fran, and competition is a key part of that.
KELLY:
Can I just ask you on another issue, because you’ve been name checked this morning by Peter Dutton. Labor has branded Peter Dutton’s nuclear picture fantasy to see. But on ABC TV this morning, Peter Dutton said you, in fact, he named you Andrew Leigh, were the ones making things up. Here he is.
PETER DUTTON:
I mean, Andrew Leigh, for somebody, for example, who’s a federal member of Parliament, he’s part of a government that signed up to putting our submariners onto the submarines with the nuclear reactor. He’s putting out photos of 3 eyed fish in all of this sort of juvenile conduct, which frankly should be condemned, including by the ABC. So, we have taken a deliberate step not to be held hostage by the Labor Party and the scare campaign. We want the information out there in bite sized bits, if you like, so that people can consume exactly what it is that we’re proposing and understand what it’s not proposing.
KELLY:
Well, that’s Peter Dutton this morning on News Breakfast. He’s right about one thing. We do deserve a mature debate, perhaps a more mature debate here in Australia. I mean, most developed countries have nuclear power, many have reactors. It’s a mature industry. Even if you don’t think it’s right for Australia, there’s not 3 eyed fish swinging around, are there?
LEIGH:
Well, Fran, apart from the fact that Peter Dutton can’t tell a fish from a koala, I think his response.
KELLY:
What, you had a picture of a 3 eyed koala?
LEIGH:
Yes.
KELLY:
Ok. Sorry, I couldn’t find the pictures. I was looking everywhere. Where are they?
LEIGH:
That’s totally fine. I mean, the fact is that Peter Dutton is trying to distract from his refusal to release any costings, his refusal to provide answers on when nuclear power would come on stream. We know that nuclear energy is too slow to keep the lights on. It’s too expensive to build, it’s too risky for Australia’s energy needs. Frankly, he’s gambling Australia’s energy and economic security by wrecking the delivery of reliable renewables and instead promising untested, inconstant experimental nuclear reactors across Australia.
KELLY:
A lot of our listeners writing in about where’s the waste go? What about nuclear waste? People are worried about this. The Shadow Minister, Ted O’Brien, told Craig Reucassel on 702 this morning that Labor’s looking for a permanent site for the high level nuclear waste anyway that’ll be used by the submarines under the AUKUS deal. So, what’s the difference?
LEIGH:
The amount of waste produced by nuclear submarines and by nuclear medicine is tiny.
KELLY:
Well, hang on. Nuclear submarines is a different level of waste than that used by nuclear medicine, isn’t it? You need a different site for the 2.
LEIGH:
Indeed. But again, you’re talking about very small quantity. Look, our main critique of what Peter Dutton has been doing is that it’s going to mean, as Malcolm Turnbull said yesterday, higher prices and worse environmental outcomes. Peter Dutton would stop the rollout of reliable renewables and bet the future on an uncosted, madcap nuclear fantasy. Nuclear just isn’t the right solution for Australia.
KELLY:
Andrew Leigh, we’re almost at the news. Just in very, very brief answer, have you found a site for the nuclear waste from the subs?
LEIGH:
Well, that’s going to be a matter which will be dealt with as the submarines come, those submarines are well off into the future. It’ll certainly be an issue that’s dealt with as part of that.
KELLY:
Andrew Leigh, thank you very much for joining us on 702.
LEIGH:
Thanks very much.