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Wednesday, 24 September 2008
Page: 5568

Senator BARNETT (7:06 PM) —I rise tonight in the adjournment debate to highlight the sham that is the GROCERYchoice website of the Australian Labor Party. This is a $13 million white elephant and it is called GROCERYchoice. In the lead-up to the 2007 federal election we all recall that the then opposition leader, Kevin Rudd, and the Labor Party said that they would put downward pressure on grocery prices and indeed on fuel prices. Already, less than 12 months after the election, the Rudd Labor government appears to have given up. The Fuelwatch arrangements have already been discredited far and wide throughout the country and tonight I would like to focus on GROCERYchoice and the farce that it is.

I am going to just highlight the flaws in this website. A total of $13 million of taxpayers’ money has been used to in fact promote the major chains to the detriment and to the disadvantage of the independent retail supermarkets throughout this country. If the government were a trading corporation rather than a government—the ACCC actually hosts this website for and on behalf of the government—in my view they could be sued under the Trade Practices Act for misleading and deceptive conduct, because that is exactly what is occurring.

I will walk through the concerns that I have, remembering that the coalition on this side support any sensible proposals that result in Australians paying less for groceries and less for fuel. GROCERYchoice only covers 500 items and it provides prices that could be either one month or up to two months out of date. A typical large supermarket stocks between 25,000 and 30,000 lines. It does not provide information on the price of individual brands, only categories of products. There are huge gaps in its coverage and, specifically, there are gaps in regional areas in Tasmania. Areas as diverse as St Helens and Launceston, for example, are included in the same region. There are only three regions in Tasmania. I have been looking at the website this afternoon, and you can see how absurd it actually is in terms of that framework.

In regard to Tasmania there are no independent supermarkets in the southern Tasmanian region with a floor space of over 1,000 square metres. Why do I refer to 1,000 square metres? Because that is the criterion used by the Australian government and the ACCC. They say on their website that, to ensure that the full range of 500 products can be priced at each of the supermarkets included in the price survey, the selection was generally restricted to those stores with a floor area of greater than 1,000 square metres. The facts are that in Tasmania there are only two independent supermarkets with more than 1,000 square metres: one at St Helens and one in Prospect in Launceston. So you have only got one region that satisfies the criteria. With respect to the other two regions, they are comparing the major chain supermarkets, which in Tasmania control in the vicinity of 80 per cent of the retail grocery market. So they are comparing apples with oranges, not apples with apples. That is what is happening as a result of this fraudulent GROCERYchoice website.

In terms of Tasmania I will be a little more specific by referring to the fact that the ACCC attempted to survey Festival IGA at Lindisfarne, which has 285 square metres, so it is nowhere near the 1,000 square metres criterion. They attempted to survey this independent supermarket and, fortunately, the owner had the good sense to say: ‘No. I will refuse your efforts to survey my supermarket.’ They have also successfully surveyed the Value Plus IGA supermarket in Valley Road, Devonport, which has 318 square metres—nowhere near 1,000 square metres. That is the absurdity of this. It is unfair and anticompetitive. It is hurting the independent supermarkets and they should close it down.

Let me speak a little further about this flawed white elephant that is GROCERYchoice, costing $13 million of taxpayers’ money. Let us look at what is says on the website. It is, bizarrely, pushing the foreign owned Aldi chain as the cheaper option to the other outlets. Of course Aldi does not exist in Tasmania, so what relevance is that of for us in Tasmania? I do at this stage want to commend Brighton councillor Leigh Gray for his efforts to bring Aldi to Tasmania. Good on him for standing up and supporting that effort.

Not one Tasmanian shopper will benefit from this GROCERYchoice website. The government’s GROCERYchoice lumps corner stores and large independent stores into the same independent category, because they cannot, for example, in Tasmania find enough independent grocery stores with 1,000 square metres of space or more. Obviously they have got to get the smaller independent grocery stores, and, of course, they come out worse off. I have looked at the prices today and that is exactly what is occurring. It is anticompetitive and it is disadvantaging them.

Small retail outlets cannot and do not operate to the same economies of scale as major chain supermarkets. How can a 1,000 square metre store be fairly compared with a supermarket in excess of 4,000 square metres, or indeed larger. In terms of Tasmania, I want to highlight the concerns that have been expressed by Grant Hinchcliffe on behalf of Tasmanian Independent Retailers when this website was officially launched. He said that TIR, Tasmanian Independent Retailers, have exposed the ACCC’s GROCERYchoice website as a ‘misleading sham for Tasmanian shoppers’. He said:

 ... if true, reported claims by ACCC chairman Graeme Samuel that the website only compared supermarkets that were 1,000 square metres or larger were wrong.

There are no independent supermarkets in southern or north west Tasmania over 1,000 square metres in size, be they IGA banner supermarkets, Foodworks or other non-aligned grocery retailers.

In fact there are only two independent supermarkets in the State with a floor space over 1,000 square metres and they are located at St Helens and Prospect.

…            …            …

It’s unfair and unreasonable to compare the retail prices of a small independent to that of Woolworths or Coles that operate stores up the three times or more in size, with on average up to six to eight times the turnover.

TIR are an excellent cooperative. They have done wonderful work in Tasmania. They are the backbone of the small business community, particularly in the rural and regional areas. They should be commended and they should be supported by this government, not kicked in the head while they are down. They represent over 120 stores in Tasmania operating under the Festival IGA, Supa IGA, Value Plus IGA and Friendly Grocer IGA banners, and they do a wonderful job.

At the national level, the National Association of Retail Grocers of Australia is an excellent organisation. The president is John Cummings, a Western Australian, a very fine citizen and an outstanding individual. The executive director is Ken Hendrick. He does a wonderful job representing the interests of small and independent retail grocers across Australia. What did John Cummings say at the release of GROCERYchoice? He said that it was a costly sham. He said:

The ACCC has thrown the Rudd Government another hospital pass.

GROCERYchoice, the grocery price monitoring program designed, recommended and endorsed by the ACCC, does not take into account how consumers buy groceries and does not deliver one benefit.

The data has been collected by regions, even the smallest of them covering hundreds of square kilometres, the largest tens of thousands of square kilometres. These are not real world shopping catchment areas.

Early data collection by the ACCC’s agents have covered a basket of 500 items, but we are given no data on which items are included in the basket—and therefore we have no way of knowing whether the surveys accurately compare like products.

In conclusion, he said:

Punch in your postcode and you’ll be taken to a page purporting to give you prices for a basket of goods in Woolworths/Safeway, Coles/Bi Lo, Franklins, Independents and ALDI.

He summarised it well.

There are serious concerns and I raise them in the Senate tonight. I ask the government to reconsider and to say that this is a fraud, it is misleading and it is deceptive. If the government were a corporation it could be sued—and I think successfully—for false, misleading and deceptive conduct. It is disadvantaging small and independent retail grocers not only across Australia but particularly in Tasmania. I highlight that for the Senate.