The Minister for Competition Policy and Consumer Affairs, the Hon. Chris Bowen MP, today announced the details of the Government's approach to the roll-out of a nationally-consistent, mandatory unit pricing regime.
The Government's commitment to unit pricing was made as part of its preliminary response to the ACCC Grocery inquiry.
"Unit pricing will help consumers save time and money," Mr Bowen said.
"The unit pricing regime will apply to all packaged grocery items so that consumers will be able to use the information to find the best value and help make real savings on their weekly grocery bills. The introduction of unit pricing will make a big impact on household budgets.
"The Rudd Government has designed an Australian unit pricing scheme that gets the balance right - that both empowers consumers and minimises the regulatory burden on business."
Unit pricing is the display of the price of goods per unit measure, for example per 100 grams, per 100 millilitres, per metre or per item. Grocery shoppers will be familiar with unit pricing as it already applies to groceries sold by weight, such as fresh meat, vegetables and fruit.
"Unit pricing will help consumers compare packaged grocery items of different sizes easily and quickly," Mr Bowen said.
"This is particularly useful where package sizes are similar but not identical."
"When Australian consumers are doing the weekly grocery shopping, identifying the best value from a large range of different products or package sizes can be difficult and time consuming."
Unit pricing is already used in the European Union and the United States of America. It has proven to be a popular and useful tool that enhances price transparency for consumers when making their purchasing decisions in supermarkets.
"Independent studies have found that there are substantial savings to be made through the use of unit pricing information by consumers when they shop for groceries," Mr Bowen said.
The Government notes that since it announced that it would proceed with a national, mandatory unit pricing regime, some supermarket chains have started to put in place their own, voluntary schemes.
The Government will undertake further consultation before finalising a code to be prescribed under the Trade Practices Act 1974. Details of the scheme are attached.
The Government is also progressing the ACCC's other recommendations in the Grocery Inquiry Report, and will make further announcements with respect to these recommendations by mid-2009.
Attachment
Key Features of the National Unit Pricing Regime
The national unit pricing regime will:
- be established by regulation as a mandatory code of conduct under Part IVB of the Trade Practices Act 1974 by 1 July 2009, to apply from 1 December 2009;
- apply to all store‑based retailers with floor space for the display of groceries greater than 1000m2 and that supply at least a prescribed range of food‑based grocery items;
- apply to all online retailers that supply at least a prescribed range of food-based grocery items;
- apply to any other retailer that chooses to display unit prices for grocery items with a transition period of six months;
- require retailers covered to provide a unit price for all items they sell for which a selling price is displayed, unless the item is part of a prescribed category of exempt items;
- not apply to goods sold at a reduced price due to damage or their perishable nature; offered for sale as a bundle of different types of items for a single price; or that are part of a prescribed category of exempt goods for which unit prices are not practical;
- apply to all in‑store representations of price unless specifically excluded;
- apply to all online store price lists unless specifically excluded;
- apply to other non‑store print advertising such as catalogues, newspaper advertisements or front‑page website advertisements;
- not apply to non‑print advertising such as radio and television;
- require the unit price to be prominent, unambiguous, legible and in close proximity to the selling price;
- use standard units of measure being per 100ml/100g/metre/m2/1 unit (where sold by count) with other measures for prescribed categories of goods; and
- operate only to the extent that it is not inconsistent with any other Commonwealth legislation.
The Australian Competition and Consumer Commission will provide industry and consumers with educative measures and be the agency responsible for the enforcement of the code.