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Monday, 10 November 2008
Page: 10417

Mr BRUCE SCOTT (8:00 PM) —I rise tonight to second the motion by my colleague John Forrest, the member for Mallee, who is calling on the House to note with concern the high level of market concentration in the retail grocery sector which the ACCC rather inappropriately calls ‘workably competitive’. Talk about bureaucratic doublespeak. It is a classic example of the ACCC’s work so often being about doing nothing but bringing forward reports. Here is an opportunity for them to do something about the duopoly that is impacting on small grocery retailers—yet they see the market at the moment as ‘workably competitive’. I also want to support the member for Mallee in his call for this Labor government to address the issue of market concentration in the grocery sector and to implement policies to achieve improved outcomes for consumers, food manufacturers and producers.

Medium sized and family owned grocery stores are the lifeblood of many small towns in my electorate of Maranoa. IGAs are often the only large grocery stores in town. FoodWorks stores are also present. They are so often family run, with a family investing their life savings and work and effort into that business. Locals rely on these stores, often run by someone they know very well, to provide them with their daily bread, fruit and vegetables, not to mention other very important non-perishables.

So I share my colleague’s concern for the fate of many small to medium enterprises in the retail grocery sector. The evidence showing that Woolworths and Coles share almost 80 per cent of the market is particularly disturbing, very much so as their dominance extends out to petrol, hardware, clothing and now even liquor. Yet more people—and this is an interesting point—across Australia are employed by independent grocery retailers than the large supermarkets. In fact, 57 per cent of full-time employees in the retail grocery sector are employed by independent retailers, compared to 43 per cent employed by Woolworths, Franklins, Coles and Aldi.

As we know, Woolworths, Franklins and Coles, and Aldi to some extent, cherry-pick the markets into which they will go. They go in aggressively, with the intent to capture the dominant share of a market which so often is a position that has been occupied by a smaller grocery supplier in the past. Should these smaller grocery retailers be eventually squeezed out, I would be very worried about how this will impact on not only the stores but also the employees, because those smaller retailers are still the majority employers, in percentage terms, in the grocery sector across Australia.

But my concern also extends beyond the success of independent grocery retailers in my electorate to the future of farmers in my electorate, and the farmers of the Mallee electorate—I am very concerned about them—who supply this country with clean, green food, so often taken for granted in this nation. It is clean and green and it is some of the most affordable food in the world, and of course it has always been available so it is taken for granted. Australian producers are already battling cheaper imports. I particularly point to the impact of the importation of pork, fish and other seafood on local producers here in this country. And then of course they have to deal with the power of the Coles-Woolworth duopoly, which, if it continues, may see many farmers forced out of business—because of the power in the market share of those two major retail grocery chains.

Food security is another important issue, and some countries are already experiencing a food crisis. The 6 November media release of the United Nations Food and Agriculture Organisation states:

World agriculture is facing serious long-term challenges, including land and water constraints, low investments in rural infrastructure and agricultural research, expensive agricultural inputs ...

relative to farm gate prices—

and little adaptation to climate change.

FAO estimates that to feed a projected world population of more than nine billion people by 2050 ... global food production must nearly double.

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