The Albanese Government has formally issued a direction to the Australian Competition and Consumer Commission to investigate pricing and competition in the supermarket sector to ensure Australians are paying a fair price for their groceries.
The inquiry – the first of its kind since 2008 – will investigate the competitiveness of retail prices and allegations of price gouging in the supermarket sector.
It’s an important part of the Government’s broader efforts to boost competition and put downward pressure on the price of essentials for Australians, including a review of the Food and Grocery Code of Conduct and the Competition Review’s focus on cost‑of‑living initiatives.
Matters to be considered by the ACCC will include, but will not be limited to:
- The current structure of the supermarket industry at the supply, wholesale and retail levels;
- Competition in the industry and how it has changed since 2008, including the growth of online shopping;
- The competitiveness of small and independent retailers, including regional and remote areas;
- The pricing practices of supermarkets;
- Factors influencing prices along the supply chain, including the difference between farmgate and supermarket prices;
- Any impediments to competitive pricing along the supply chain; and
- Other factors impacting competition, including loyalty programs and third‑party discounts.
The ACCC will provide an interim report by 31 August 2024 and a final report by 28 February 2025. The direction can be found on the Federal Register of Legislation.
Quotes attributable to Treasurer Jim Chalmers:
“I’ve directed the ACCC to investigate pricing and competition in the supermarket sector.
“We want a fair go for families and a fair go for farmers.
“Australians are under cost‑of‑living pressure, and we know that a lot of that pressure is piled on at the cash register.
“This is about making our supermarkets as competitive as they can be so Australians get the best prices possible.”
Quotes attributable to Assistant Minister for Competition, Charities and Treasury Andrew Leigh:
“Competition is the consumer’s friend. Economics teaches us that monopolies tend to overcharge and underdeliver.
“In a highly concentrated market like Australia’s grocery sector the risk of price gouging is high and that’s especially true when the rising cost‑of‑living is hurting so many Australians. This ACCC inquiry, along with the review of the Food and Grocery Code by Dr Craig Emerson and CHOICE’s quarterly price reporting will ensure that Australian families and farmers are getting a fair deal.”