JIM CHALMERS:
I wanted to thank Craig Emerson for his interim report reviewing the grocery code and I wanted to acknowledge Andrew’s work in the competition policy space as well. This interim report will help us strengthen the Food and Grocery Code for the better. This is all about a fair go for farmers and families – that's what this is all about. It recognises that by replacing a voluntary code with a mandatory code, it's easier to enforce. We can impose penalties on people who do the wrong thing, and it's also harder for people to walk away from.This is about getting a better deal for people right up and down the supply chain. This is a perennial challenge in our economy and in our markets and this interim report from Craig Emerson will help us address that.
We've gone about this in a characteristically considered and methodical way. There's a lot of complexity here. We want to make sure that we get our competition policy settings right in our economy. Here the contrast with our opponents couldn't be clearer. This morning, as I understand it, the Liberals and Nationals had a different view on competition policy between 6:46 am in the morning and 6:47 am. One of them said that they had concerns about divestment, another said that they were all for it. The Coalition is all over the shop when it comes to competition policy and supermarkets. We saw that yet again today. They should clarify their position and if David Littleproud thinks that more should have been more done in this area sooner, where were they for the almost decade that they were in office?
This is all about making the Food and Grocery Code stronger, more robust, and fairer. It is about a fair go for farmers and families – and as Andrew will say in a moment – this is part of a whole range of actions that we are taking when it comes to competition policy to help put downward pressure on prices, to make sure there's fairness in our supply chains and to make sure that our economy is as competitive and productive and dynamic as it can be.
And on that front, later this week, I will be announcing very substantial changes to the mergers regime. The changes I announce this week will be all about strengthening and streamlining the mergers regime so that we can modernise it, and once again, so that we can make our economy genuinely more competitive, more productive, more dynamic in the interests of all Australian people, employers, employees alike. We're going to hear from Andrew, then happy to take your questions.
ANDREW LEIGH:
Thanks very much, Treasurer. Again, it's Labor making the running on competition policy, and I want to thank Craig Emerson, former competition minister, and really one of Australia's best policy economists for the important work that he's done on this report.
We've heard frequently about the challenges that suppliers have in making complaints under the existing voluntary code. There really is a fear of retribution out there and that's why Dr Emerson's report has recommended a mandatory code. It would have substantial penalties attached and Dr Emerson will be working through, as he moves towards his final report, precisely what that would look like.
But let's be clear, it's taken a Labor‑initiated inquiry to recommend that the Food and Grocery Code of Conduct be made mandatory. For all the of bleating you hear from the National Party, when they were in Cabinet, the Cabinet decided to make the Food and Grocery Code a voluntary code. When they asked for a review in 2018, they decided to make it a voluntary code. The National Party are tigers in opposition but kittens in the Cabinet. The fact is it's only Labor that takes these issues seriously and is looking for a fair go for farmers and a fair go for consumers.
This sits, as the Treasurer has said, alongside the mountain of work that we're doing to make the economy more competitive. Last year the Treasurer and I announced the Competition Taskforce within Treasury, which has been working on the issue of mergers, which the Treasurer will speak about later this week, the issue of non‑compete clauses, which I spoke about last week, and improving competition in data and digital. We're revitalising national competition policy, inspired by the work done in the early 1990s under Fred Hilmer and Paul Keating, which put $5,000 a year into the pockets of the typical Australian household. We understand many of these challenges involve working with states and territories and we're actively engaged in that.
And in the supermarket space, the Treasurer has tasked the Australian Competition and Consumer Commission to do a deep dive inquiry into grocery store competition and ensure consumers are getting the best deal possible. CHOICE are now out collecting the data for their quarterly price monitoring report, the first of which will be coming down at the end of June. Labor wants to see better prices, better prices for suppliers, better prices for consumers. We're happy to take your questions.
JOURNALIST:
Treasurer, given the fact that Dr Emerson has made firm recommendations, will you start work on the new code or the revamped code before his final report?
CHALMERS:
We're pretty much working on these sorts of competition reforms around the clock. We have been, as Andrew indicated a moment ago, for some time. We know that this is an interim report, we know that there's a few weeks of consultation to follow, but he's made it clear about those eight firm recommendations. We support those in principle, subject to that consultation that will happen over the next few weeks.
We want to strengthen the code. An important part of that is making it mandatory, imposing penalties, making sure that we get the dispute resolution right, all of those key features of those eight recommendations from Craig are something that we are interested in progressing, subject to a few weeks of genuine consultation.
JOURNALIST:
What do you say to the BCA defending the profit of Woolies, given it's making just 3 cents in every dollar, is your government demonising profits?
CHALMERS:
Of course not. That's the job of the BCA. I've got a very effective, respectful, working relationship with the BCA. I spend a lot of time with them and with their members, as you would expect. We recognise the absolutely central role of the private sector in making our economy more productive and dynamic and competitive. We want our businesses to be profitable and successful and we want them to hire people in good jobs with secure pay. And we will continue to work very closely with the business community to satisfy those objectives that we share.
JOURNALIST:
But is 3 cents in every dollar enough?
CHALMERS:
I'm not going to go through every element of Bran's opinion piece in the paper. I've indicated the close, respectful working relationship I have with the BCA and with their member employers. We recognise the central role of the private sector in achieving our economic goals and that's why we work so closely with them.
JOURNALIST:
Treasurer, you seem to be [indistinct] about getting a fair go for suppliers and consumers. Do you commit that the mandatory code will include tougher measures to crack down on some of the practices that farmers are singling out as anti‑competitive?
CHALMERS:
Absolutely. The whole point of this interim report is how do we make the code tougher, how do we make it compulsory, better dispute resolution processes and bigger penalties for people who do the wrong thing. These are the central themes of the interim report that Craig has handed down and as Andrew said and as I've said a couple of times now, the defining motivation behind this is a fair go for farmers and families. The current voluntary code is too easy to walk away from and we want to change that.
JOURNALIST:
Treasurer, this is not going to be finalised overnight so what cost‑of‑living measures can we expect in the Budget for consumers? And if I may, on a totally different topic, the Fairfax papers have reported today that the NDIS is forking out on $1.4 million for around‑the‑clock supervision [indistinct], is that acceptable?
CHALMERS:
First of all, in reverse order, I'll leave commentary on the second matter, I'm unsure of the legal status of that. I've seen those reports, obviously, but I'm happy to make comment on that on a subsequent occasion.On your first question about cost of living, one of the key features of the Budget we hand down five weeks from tomorrow will be helping to ease cost‑of‑living pressures on Australians who are under of the pump. Overwhelmingly, the biggest part of that cost‑of‑living relief will be a tax cut for every Australian taxpayer and a bigger tax cut for more taxpayers to help with these cost‑of‑living pressures which we acknowledge, but more than acknowledge, we're doing something about.
We've said on a number of occasions, the Prime Minister and I and other senior ministers have said, that the tax cuts will be the central cost‑of‑living relief in the Budget. If we can afford to do a little more than that we're obviously prepared to consider that. We've still got a few weeks of decision‑making time before we get to the Budget.
Competition policy is a really important part of easing cost‑of‑living pressures on Australians who are doing it tough. And really, right across the board, what we've tried to do is to unleash the power of competition policy in our markets so that people are getting fair prices and that's part of easing these cost‑of‑living pressures that people are under.
JOURNALIST:
Just beyond your observation of the Coalition failed to do [indistinct] divestiture when they were in government, are you dead set against it? Are you ruling out doing that if that's an idea that comes before the Parliament?
CHALMERS:
I think the Prime Minister's made clear the government's view when it comes to that. And I think others, whether it's Craig Emerson today, whether it's the Chair of the ACCC, it's very clear to us that there are much higher priorities when it comes to competition policy. That's not something that we have been exploring because we have found better, more effective ways to deal with some of the issues in our competition policy landscape. I'm going to ask Andrew to add to that briefly and then we'll going Charles, then Mark then Tom.
LEIGH:
Thanks, Treasurer. Paul, the Harper Review didn't recommend divestiture powers. The Hilmer Review didn’t recommend divestiture powers, the Dawson Review didn't recommend divestiture powers, and Craig Emerson's review hasn't recommended divestiture powers. The National Farmers' Federation has opposed divestiture powers. The ACTU has also been quite clear they have concerns about it because of the potential impact on workers.
You had Peter Dutton out at the start of the year calling on Australians to boycott Woolworths, Australia's largest private sector employer. Peter Dutton may not care about the workers of large retail stores, but they're firmly in the minds of Labor and our thinking about the best policy response that will make a practical difference for consumers and workers.
JOURNALIST:
Treasurer, the interim report seems to suggest the best protection for farmers is whistleblower protection or no punishment of those that speak out. Is there any more that can be that the farmers that are doing it tough at the moment of the hands of supermarkets?
CHALMERS:
I think it's a bit more than how you've described it respectfully. What we're talking about here is making the code compulsory, having big penalties for people who do the wrong thing, getting the dispute resolution right. So that suppliers and farmers can't be dudded in the system. That's really what we're trying to do here and that's a substantial, I think, and a substantial step.
And one of the other things that we've discovered engaging closely with the NFF and other key farming and other stakeholder groups, is this is an important part of what we're doing in competition policy but it's not the only part of what we're doing. I'll have much more to say about it with the announcement that Andrew and I make on Wednesday of this week, and as he ran through a moment ago, there's a whole suite of things that we're doing in competition policy and when we think about the best possible step of competition policy arrangements, farmers are really front and centre in those considerations.
JOURNALIST:
Treasurer, we seem to have entered something of a parallel universe here where the conservatives are championing market intervention, sharp market interventions like divestiture powers and Labor is now the bastion of the free market. Without those divestiture powers, and talking about voluntary codes, what is the big stick here?
CHALMERS:
I think anyone who has had a look at the sorts of penalties that Craig Emerson is proposing will see that this is a substantial proposal to punish people for doing the wrong thing. So I don't agree completely with your characterisation of the major parties on this front, partly because I'm not sure what the Coalition's view is. Within a space of a minute this morning, two senior shadow ministers had very different views and so they need to clear that up. Peter Dutton needs to show some leadership. I don't know what Angus Taylor's view is on all of this, and so I think it's not quite as clear as you've described it.
What we've shown is that we are prepared to work through these big issues in a consultative and methodical and considered way. That means we can come up with substantial changes like what we will announce on Wednesday. But doing it in a way where everybody gets a hearing and we're landing on the right outcome for Australia. I don't think you could describe what the Coalition is up to right now when it comes to supermarkets as careful or methodical or consultative. They are all over the shop and we saw it again this morning.
JOURNALIST:
Was it your expectation that this process will bring prices down for consumers at the supermarket and does that mean that big business has to carry the cost of that, especially if they're paying the suppliers?
CHALMERS:
We've made it very clear. I think the Prime Minister this morning and others have made it clear that when it comes to the changes we want to make to competition policy, a big motivation is to put downward pressure on prices. And I encourage you to see these changes proposed by Craig Emerson in the context of all of these changes that we are proposing across competition policy. We want to make sure that our businesses are more productive and more competitive, we want to make sure there's downward pressure on prices for consumers, and we want to make sure that our economy is modern so that we can maximise the opportunities before us. And so those are our motivations and Craig's very welcome contribution today is part of that effort. Thanks very much, everyone.