The Albanese Labor Government is injecting a $30 million boost into the ACCC in a bid to tackle unfair pricing across the retail sector in response to the recently launched litigation by the corporate watchdog against Woolworths and Coles.
The funding will help the ACCC conduct more investigations and enforcement in the supermarket and retail sectors.
According to the government, this will enhance the regulator’s ability to proactively monitor behaviour and investigate pricing practices where there are concerns about supermarkets and retailers falsely justifying higher prices.
In addition to this crackdown, the Treasurer will work closely with states and territories through the Council on Federal Financial Relations to reform planning and zoning regulations, which will help boost competition in the supermarket sector by opening up more sites for new stores.
Current planning and zoning frameworks, including land use restrictions, zoning laws and planning regulations, are acting as a barrier to competition by inhibiting business entry and expansion. They potentially allow for land banking, preventing competition and pushing up prices in local communities.
“Today we are announcing a crackdown on dodgy supermarket practices,” Prime Minister Anthony Albanese said.
“We don’t want to see ordinary Australians, families and pensioners being taken for a ride by the supermarkets, and we’re taking steps to make sure they get a fair go at the checkout.”
The ACCC welcomed the $30 million boost, with chair Gina Cass-Gottlieb saying this allows for significant enhancement of the watchdog’s enforcement and compliance activities in an essential sector relied upon by millions of Australian consumers.
“Active, evidence-based enforcement of the Competition and Consumer Act is core to the ACCC’s work, and is essential for deterring conduct that harms consumers, competition and fair trading, and by extension productivity and the wider economy,” Cass-Gottlieb said.
“The ACCC’s work has always reflected the current issues impacting the Australian economy, consumers and businesses - informed by evidence, information and intelligence from a range of sources. This includes reports to our Infocentre and social media, engagement with consumer stakeholders and other government departments and regulators, as well as pro-active surveillance.
“This funding will enable us to escalate a range of investigations in this sector, including in relation to potential misleading pricing claims or practices, claims about delivery timeframes and costs including for regional and remote Australians, and businesses misrepresenting consumers’ rights under the Australian Consumer Law,” Ms Cass-Gottlieb said.
The ACCC announces its compliance and enforcement priorities each year in February and March. This year its priorities included competition, consumer, fair trading and pricing concerns in the supermarket sector, with a focus on food and groceries.
While already prioritising action in these sectors and taking action, this further funding will allow the ACCC to identify, progress and bring forward additional matters.
“We have heard first-hand from consumers how the cost of living is impacting their ability to choose and that they need to be more cautious with purchasing decisions. It is critical that consumers are provided with clear and accurate information about the price or value of the goods and services they rely on,” Cass-Gottlieb said.
“The ACCC is also receiving an increasing number of reports from consumers worried about prices and representations made about the quality or features of goods and services, as well as a growing number of reports about delayed or non-delivery of goods purchased online.”
The ACCC is currently conducting a 12-month inquiry into Australia’s supermarket sector following a formal direction from the Australian Government on February 1, 2024. The interim report for the inquiry was released last week.
So far this year the ACCC has secured more than $85 million in penalties in consumer and competition enforcement work, not including the $100 million penalty against Qantas which the ACCC and Qantas have submitted to the Federal Court is an appropriate penalty, to be considered by the Court at a hearing in October.
The ACCC has also instituted proceedings against a range of parties in the retail sector, including the Good Guys, Coles and Woolworths.
“In this, the 50-year anniversary of the Trade Practices Act, the ACCC remains committed to making markets work for consumers,” Cass-Gottlieb said.