Opposition Leader Calls for Action Against Coles and Woolworths

Opposition Leader Peter Dutton has made strong accusations against Coles and Woolworths, claiming that they are hindering competition by holding onto undeveloped land near their stores. He has pledged to take action to safeguard consumers from potential price hikes.

The Coalition is devising a plan to forcefully dismantle the dominance of these supermarket giants if they misuse their market influence. Dutton highlighted the government’s successful efforts in reducing electricity bills through tough legislation, suggesting a similar strategy could be employed against supermarkets.

In a speech to the Council of Small Business Organisations of Australia, Dutton emphasised the need for action against market domination when consumers suffer due to market failures. Shadow Treasurer Angus Taylor and Nationals leader David Littleproud have been tasked with developing an opposition policy to address these concerns amidst ongoing inquiries into supermarket competition.

The Coalition’s proposed plan could target various aspects, including property acquisitions and the strategic advantage supermarkets gain through land ownership. Independent players, like Fred Harrison from Ritchies, have echoed complaints about unfair practices.

Reports from a Senate inquiry revealed instances where smaller stores, such as local IGAs, were forced out of rental agreements after major chains acquired shopping centres. The Australian Competition and Consumer Commission (ACCC) monitors land sales and property deals in the supermarket sector.

Dutton raised concerns about Coles and Woolworths purchasing land to prevent competitors from establishing nearby. He questioned the fairness of such behaviour, especially when consumers are already facing high prices.

Business groups have cautioned against using breakup powers on Coles and Woolworths, fearing potential negative impacts on the economy and job security. Ritchies’ Fred Harrison advocated for scrutiny extending to state and local planning laws, emphasising the importance of fair competition.

The dominance of Coles and Woolworths, controlling about 65 percent of the sector, has drawn attention to issues of fair competition. Both companies deny allegations of land banking and assert facing increased competition from Aldi and new entrants like Amazon.

A Woolworths spokesperson stated that Woolworths’ developments aim to better serve customers, while Coles emphasised the supermarket sector’s competitiveness. Both emphasised regulatory requirements and the time it takes to develop new stores.

Senator Bridget McKenzie criticised businesses supporting certain political proposals and advocated for stronger measures to protect small businesses from market abuses.

While some accusations of price gouging exist, recent data from the Australian Bureau of Statistics showed moderate increases in food prices compared to other countries. Profit margins in the grocery sector, as reported by Coles and Woolworths, are in line with international standards.

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