The ACCC’s Supermarkets Inquiry held several public hearings in November. CPSA was invited to give evidence.The Australian Competition and Consumer Commission (ACCC) has been investigating the conduct of the major supermarket chains (Coles, Woolworths, Aldi and Metcash, the company that supplies IGA) since the beginning of this year. While the supermarkets inquiry is not expected to finish until the end of February 2025, it entered a new phase in November with a round of public hearings.
Executives from the major supermarket chains were questioned in these hearings, but some other organisations were also invited to give evidence on behalf of grocery suppliers and consumers. As an organisation representing the interests and concerns of older people, CPSA was asked to attend one of the hearings.
CPSA’s evidence
CPSA attended a hearing alongside representatives from CHOICE and the Indigenous Consumer Assistance Network (ICAN). CPSA’s representative began by pointing out that many older people are on fixed incomes, making them both highly aware of, and highly susceptible to, increases in the cost of their regular grocery purchases.
This reflects evidence provided by our members. In a postal survey of our members conducted earlier this year, respondents ranked food and grocery prices as the most important cost of living issue affecting them. Likewise, in an online survey conducted at the end of 2023 we found that nearly 90% of respondents had found it harder to pay for groceries in the previous six months.
CPSA’s representative also argued that many of the cost saving options available to younger people in metropolitan areas may not be practical for older people, people with limited mobility and people in regional or rural areas. While some people may be able to visit multiple different shops in a single trip to seek out specials and lower prices, this likely won’t be possible for people who have only one grocery store nearby. It would also be difficult for people who have chronic pain or disability.
Online shopping and online price comparison tools like ‘Frugl’, a mobile phone app, may also be harder for many people to use if they live in an area with poor internet access or if they are less familiar or comfortable using online technology. CPSA’s representative argued that it was not enough to expect everyone to use these methods to afford their groceries.
Prices even higher in remote communities
While grocery price increases have had a big impact on many communities, some remote communities were paying even more for their groceries than the rest of the country. Representatives from ICAN and CHOICE gave evidence showing that some rural communities are charged more than twice as much for certain products, with these price markups being attributed to freight costs by the shop owners. However, the representatives suggested that these so-called freight costs may have just been a smokescreen for shop owners to increase their profit margins on certain goods.
Evidence from ICAN’s representative showed an interesting solution to the cost-of-living crisis though. In some remote communities in the Northern Territory, local governments and the Territory Government have worked with community members to set up community operated grocery shops. Because these shops are run for the benefit of the local community, they aren’t driven by profit in the same way that a privately owned shop or one of the major chains may be. Food and groceries are essential to our daily lives, so other state and local governments could adopt this model to ensure that everyone has access to these essentials regardless of where they live or how much they can afford to pay.
Evidence from the supermarkets
The Supermarkets Inquiry also heard from executives of the major supermarket chains. Unsurprisingly, the executives from Coles and Woolworths insisted that Australia’s supermarket sector was already very competitive and that they were not responsible for the price increases that many of us have seen over recent years. However, the ACCC seemed sceptical about this argument, showing evidence from previous Woolworths shareholder reports that suggested that the supermarket giants could be doing more to compete with each other on price.
Transcripts of these hearings should be uploaded to the ACCC’s website in the coming weeks and CPSA will continue to monitor the Supermarkets Inquiry as it unfolds.
The Australian Competition and Consumer Commission (ACCC) has been investigating the conduct of the major supermarket chains (Coles, Woolworths, Aldi and Metcash, the company that supplies IGA) since the beginning of this year. While the supermarkets inquiry is not expected to finish until the end of February 2025, it entered a new phase in November with a round of public hearings.
Executives from the major supermarket chains were questioned in these hearings, but some other organisations were also invited to give evidence on behalf of grocery suppliers and consumers. As an organisation representing the interests and concerns of older people, CPSA was asked to attend one of the hearings.
CPSA’s evidence
CPSA attended a hearing alongside representatives from CHOICE and the Indigenous Consumer Assistance Network (ICAN). CPSA’s representative began by pointing out that many older people are on fixed incomes, making them both highly aware of, and highly susceptible to, increases in the cost of their regular grocery purchases.
This reflects evidence provided by our members. In a postal survey of our members conducted earlier this year, respondents ranked food and grocery prices as the most important cost of living issue affecting them. Likewise, in an online survey conducted at the end of 2023 we found that nearly 90% of respondents had found it harder to pay for groceries in the previous six months.
CPSA’s representative also argued that many of the cost saving options available to younger people in metropolitan areas may not be practical for older people, people with limited mobility and people in regional or rural areas. While some people may be able to visit multiple different shops in a single trip to seek out specials and lower prices, this likely won’t be possible for people who have only one grocery store nearby. It would also be difficult for people who have chronic pain or disability.
Online shopping and online price comparison tools like ‘Frugl’, a mobile phone app, may also be harder for many people to use if they live in an area with poor internet access or if they are less familiar or comfortable using online technology. CPSA’s representative argued that it was not enough to expect everyone to use these methods to afford their groceries.
Prices even higher in remote communities
While grocery price increases have had a big impact on many communities, some remote communities were paying even more for their groceries than the rest of the country. Representatives from ICAN and CHOICE gave evidence showing that some rural communities are charged more than twice as much for certain products, with these price markups being attributed to freight costs by the shop owners. However, the representatives suggested that these so-called freight costs may have just been a smokescreen for shop owners to increase their profit margins on certain goods.
Evidence from ICAN’s representative showed an interesting solution to the cost-of-living crisis though. In some remote communities in the Northern Territory, local governments and the Territory Government have worked with community members to set up community operated grocery shops. Because these shops are run for the benefit of the local community, they aren’t driven by profit in the same way that a privately owned shop or one of the major chains may be. Food and groceries are essential to our daily lives, so other state and local governments could adopt this model to ensure that everyone has access to these essentials regardless of where they live or how much they can afford to pay.
Evidence from the supermarkets
The Supermarkets Inquiry also heard from executives of the major supermarket chains. Unsurprisingly, the executives from Coles and Woolworths insisted that Australia’s supermarket sector was already very competitive and that they were not responsible for the price increases that many of us have seen over recent years. However, the ACCC seemed sceptical about this argument, showing evidence from previous Woolworths shareholder reports that suggested that the supermarket giants could be doing more to compete with each other on price.
Transcripts of these hearings should be uploaded to the ACCC’s website in the coming weeks and CPSA will continue to monitor the Supermarkets Inquiry as it unfolds.
