Alice Matthews:
ABC Radio Canberra, this is Afternoons and we know that Coles and Woolies are among the most profitable supermarkets in the world. The big question being, how do we tackle their market dominance?
A couple of hours ago, the federal government announced the launch of a new program that they say will help fresh produce suppliers stand up to these big supermarkets by providing $2 million in grants to address this market power imbalance via education programs. Dr Andrew Leigh is the Assistant Minister for Productivity, Competition, Charities and Treasury. Dr Leigh, good afternoon to you.
Andrew Leigh:
Good afternoon Alice, great to be with you.
Matthews:
Walk me through the details of what you’ve announced this morning?
Leigh:
Well, last year we toughened up the supermarket code of conduct. Under the Coalition it had no penalties. Under Labor it now has multi‑million‑dollar penalties for supermarkets who do the wrong thing by suppliers. We want suppliers to be informed of their rights and able to go toe‑to‑toe with the big supermarkets in order to get a fair deal for farmers. These grants will allow those suppliers to fully enforce the new rights that they have, thanks to Labor and the new mandatory supermarket code.
Matthews:
And when you say suppliers, you’re talking about the farmers here?
Leigh:
Yeah, that’s right. Fresh food suppliers; people who are putting the food on our table. We want the system to be fair from paddock to plate, and the only way of doing that is to make sure that people know their rights and are able to enforce them.
It’s been a big change under Labor moving from that toothless voluntary code that the Coalition had in place to the mandatory code; and that information doesn’t always get out to suppliers, so we’re working to make sure the suppliers know their rights.
Matthews:
And how are you going to educate them on that? You talk about education programs, so what do they actually involve?
Leigh:
Well, this will be $2 million in grants, so it may well go to peak bodies or consortiums of peak bodies who run training for suppliers. It’s a particularly big issue Alice, for the fresh produce suppliers because if you’ve got a truckload of perishable produce that is turned away by one of the big supermarkets…
Matthews:
You’re on a timeline.
Leigh:
Yeah, exactly. People end up having to dump it and you’ve heard stories of farmers leaving the industry because they didn’t feel they were getting a fair deal from the duopoly. This goes alongside a whole host of other things that we’ve been doing in order to hold the supermarkets to account, crack down on shrinkflation and price gouging, reforming planning and zoning, ensuring that there’s merger notification, giving the watchdog more resources. It’s all about ensuring that the system is fairer for farmers and fairer for families.
Matthews:
So, what kind of skills can these education programs actually give the suppliers? What skills do they need to stand up to these big supermarkets?
Leigh:
Well, it’s really about helping people know their rights and know how the new system operates. It has an anonymous complaint process through the competition watchdog. It allows suppliers to better enforce rights when it comes to…
Matthews:
So, negotiating?
Leigh:
That’s right. So, we put more strength into the arm of the farmers. We want all of the farmers who are affected by that to know about it, and so supermarkets do the right thing.
Matthews:
How much of a difference do you think this particular program will make?
Leigh:
Well, I think it’s going to make a big difference. We need to ensure that the farmers who are putting food on our tables aren’t left with crumbs at the negotiating table. And this will ensure that they have that information. Of course, it’s no good just running an information program on its own.
We’re doing this off the back of having really tightened up the code. We had to fight in parliament for that. The Liberals and Nationals voted against our tougher supermarket code, but we believe it’s exactly the right thing to do in order to stand up for farmers.
Matthews:
In delivering these grants, isn’t that in some ways Dr Leigh, placing the onus on the small suppliers to try and stand up to the big supermarkets, which may not be the reality at all that they even can do that?
Leigh:
Well, we’ve got the competition watchdog there, and it’ll be enforcing the new code, but sitting alongside that, people need to know what their rights are and be ready to raise a complaint if there’s a reasonable complaint to be put forward.
So, this is about delivering funding so that farmers get a fair go at the farm gate and that they’re getting the prices that they deserve. Australians want to see cheaper prices at the checkout. They also want to see more of that money going to the people who are growing the food that we eat.
Matthews:
So, when do the grants open and how can suppliers apply?
Leigh:
The applications will open on the 5th of December and they close on the 23rd of January. And so, we’re aiming to get that training in place in the new year. It’ll help to level the playing field, and it’ll be a reform that I think will be warmly welcomed by farmers and non‑farmers alike, because Australians really want to see our farmers get a good deal from the supermarkets.
Matthews:
Well we’ll keep an eye out. Dr Andrew Leigh, thank you so much for coming on the program.
Leigh:
Thanks so much, Alice.
Matthews:
Cheers. Dr Andrew Leigh there – Assistant Minister for Productivity, Competition, Charities and Treasury talking about giving farmers and fresh produce suppliers grants to essentially understand their rights a little better, to be able to negotiate better deals with big supermarkets that they are supplying to.