Anthony Albanese says he’s not buying the supermarket giants’ price justification as the government weighs up whether to force the companies to expose any discrepancy.
The Prime Minister vented his frustration at the big supermarkets as he hit the airwaves on Monday to convince voters the cost-of-living crisis was his main priority.
“I think the problem for the big supermarket chains is that when people look at the prices that they’re paying off the farmers, and then look at what the prices they’re charging, is that people can see there’s a discrepancy there,” he said.
“People look at the profits the supermarkets are making, people know there is effectively a big duopoly who have considerable market power.”
Coles made a profit of more than $1bn during the last financial year. Woolworths reported a $1.6bn profit during the same period.
Coles and Woolworths have repeatedly denied it has engaged in price gouging.
In a statement, a Woolworths spokesperson said the supermarket would continue to deliver savings to customers “as we start to see the rate of inflation ease”.
“We are committed to offering our customers value while working with our suppliers to sensitively manage economy-wide pressures,” they said.
Coles has been contacted for comment.
Asked directly whether or not he believed the supermarkets’ justification, Mr Albanese said it was clear: “I think there is a discrepancy there. Simple as that”.
Mr Albanese met with former trade and compeititon minister Craig Emerson and Treasurer Jim Chalmers on Monday morning to discuss the direction of Dr Emerson’s inquiry into the food and grocery code.
The supermarket giants have been warned the code could be made mandatory and government intervention is an option should they fail to pass on lower prices.
Currently, the code is voluntary and it governs how Coles, Woolworths, Aldi and Metcash (which owns IGA) interact with suppliers and customers.
Dr Chalmers is also considering whether to pull the trigger on price inquiry to be run by the Australian Competition and Consumer Commission.
A competition watchdog inquiry would grant the commission the power to compel the supermarkets to reveal what they pay for produce.
A separate Senate inquiry, established by the Greens, is also set to probe allegations of price gouging by the major supermarkets.
It comes as the government is under pressure to do more to ease cost-of-living pressures on Australians despite concerns any relief could exacerbate inflation.
Treasury and Finance have been tasked with finding a way to deliver relief in line with the government’s priority to “fight inflation”.
Mr Albanese noted Cabinet was meeting on Monday to discuss the issue which he expected would spill over into the coming weeks and further meetings of the budget razor gang.
“We know that the cost of living pressures are there and we know that the fight against inflation is not over,” the Prime Minister said.
“We’ll continue to look for targeted cost of living relief, how we can make a difference for people without adding to inflation.”