Action On Groceries Terrific News For Kiwis

Hurray, for Kiwi grocery shoppers! Finally, a government and Minister that intends doing something about the lack of competition in our supermarket sector.

“Today’s announcement, from recently appointed Grocery Minister Nicola Willis, that she wants all options on the table to deliver better grocery prices, including forced divestment of the supermarket duopoly of Woolworths and Foodstuffs, is terrific news for Kiwi shoppers,” Grocery Action Group chair Sue Chetwin said.

“Currently we pay some of the highest prices on the planet for food, and while the many recent regulatory reforms of the supermarket sector have been worthwhile, none has been effective in curbing the duopoly’s market power,” she said.

Grocery Action welcomed the recognition from Willis that high grocery prices were a principle driver of the cost of living crisis facing many Kiwi families.

Chetwin said Willis had shown a deep understanding of the problem that allowing significant market power to be held by just two hugely profitable chains had meant for ordinary New Zealanders. Foodstuffs operates New World, Pak’nSave, Four Square brands and Woolworths operates its own brand plus Countdown, Fresh Choice/Super Value.

Grocery Action also welcomes her acceptance of the need for a new competitor to be able to scale up quickly – not just a few new supermarkets in limited regions but across the country and offering a full range of products.

“The Request for Information she announced today will probably not throw up anything new, but it will allow for potential domestic and international operators to show their hand, and to outline the commercial and regulatory barriers that are stopping them from proceeding.”

Chetwin said it would also help protect the Government against the inevitable lobbying and litigation from the incumbents. “This is a $25 billion industry which has managed to consolidate over 30 years, and Grocery Action has always said it would take a courageous move to disrupt that kind of market power.”

Willis’ announcement is effectively a recognition that our competition laws are not working for ordinary New Zealanders and need to change. “While we see forced divestment or structural intervention, as being an inevitable outcome, we also accept the Government needs to take a considered approach.”

Grocery Action welcomes the speed with which a decision is likely to be made about future steps. Willis has said she wants legislation in the House before the end of the year and passed in this parliamentary term.

Grocery Action was formed 18 months ago to drive more competition in the grocery sector and to bring down prices for all Kiwis. Today’s announcements brings that reality a huge step closer, Chetwin said.

Grocery Action background

The Grocery Action Group was formed to bring down the prices of groceries for all Kiwis. Our vision is to influence government, the regulators and other parties to deliver a competitive and consumer-focused grocery sector in New Zealand. Our board is made up of consumer, industry, supplier and Māori interest experts. For more info visit gag.org.nz

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