Already and this this is the daily This is the Daily ours.
Oh now it makes sense.
Good morning and welcome to the Daily Os. It's Wednesday, the thirteenth of March. I'm Zara, i'm emma. The cost of living crisis has shone a light on Ozzie's supermarket giants, Coals and Woolies. The major supermarkets will face a year long inquiry by the Competition watchdog. You've got big corporations like Coals and Woolies making record profits, ripping off and consumers in the middle of a cost of living crisis.
The retailers are facing mounting accusations of unfair prices and anti competitive practices, all.
Against a backdrop of record profits.
These concerns have escalated into multiple formal investigations, some of which, if I'm being honest, have been pretty hard to keep track of lately. So in today deep dive, we're going to take you through exactly what the supermarkets have been accused of, what these inquiries are trying to achieve, and we'll discuss if any of it is actually going to lead to cheaper groceries. That's coming up in the deep dive. But first, Zara, what's making headlines.
Donald Trump has said he will release any riders serving a prison sentence for the jan six, twenty one attack on the US Capitol if he wins the presidential election. More than one thy three hundred people have been charged since the riots in Washington that led to the deaths of at least seven people. The attack started as a pro Trump rally after current President Joe Biden's election victory,
but quickly turned violent. In a post on Trump's platform, Truth Social the former US president said if he wins the November election, one of his first acts in office would be to quote free the January sixth hostages being wrongfully imprisoned.
Over a million homes not connected to the NBN will have the price of their super fast broadband capped. It comes after the competition consumer watchdog the A Triple C announced it'll step in to ensure retailers don't unfairly charge customers. The A Triple C said will introduce maximum wholesale prices for retailers to ensure their plans are fair for customers and businesses who don't have NBN access, and to encourage competition between retail internet providers.
The twenty twenty six Commonwealth Games may have found a host country, with the Games's federation offering Malaysia a cash incentive to put on the event. Former Victorian Premier Daniel Andrews announced the state would not go ahead with plans to host the Games, citing budget concerns. The Commonwealth Games Federation has now made a formal offer to the Olympic Council of Malaysia worth nearly two hundred million Australian dollars.
That money would go to planning and hosting the competition last hosted the Commonwealth Games in Kuala Lumpa in nineteen ninety eight.
And today's good news, Scientists have discovered a way to treat infertility after successfully showing a skin cell can be used to create an egg capable of being fertilized, what will they think of next? Using the skin cell of a mouse, researchers from Oregon Health and Science University in the US discovered its chromosomes could be engineered to create an egg, which could then be fertilized with sperm. Senior researchers said the goal is to scale up the process
to assist humans with fertility. Coals and Woolworths have dominated news headlines in recent months. I can't remember a time in my life when I had ever heard so much said about coals and Woolies.
I will say, though, I feel like it's more Woolies than coals. Yeah, I know that's not the point of this podcast, but I do think I'm hearing woolies a lot more than coals, but both of them have the same accusations leveled against it.
I wonder if that has something to do with the trust that Australians had in Wullies. A survey came out last week that found that Woolworth's had dropped from being the most trusted brand in Australia to the second least lost up to Bunning's. That is interesting, I think, something
for us to interrogate another time. But right now there are multiple inquiries underway examining the supermarket giants to learn more about how they set prices, how they pay their suppliers, and what that all means for their profits and the big question if they're taking advantage of customers.
And so I guess the reason that there's so much interest in coals and Woolies has a lot to do with their power, and without going too much into how competition laws work in Australia. Both Coals and Woollies control roughly two thirds of Australia's supermarket sector. Each company reported profits of more than a billion dollars in the last financial year, so those profits were probably grad headlines no
matter what the contexts them. But why has the scale of supermarket earnings rubbed so many people the wrong way?
Recently?
Plenty has been discussed on this podcast on the Daily Ohs over the last two years about inflation. And that's really what this kind of curiosity or concern or anger against the supermarket giants has stemmed from. So rising prices. And I know we probably sound like broken records, but there really is no getting around it. You know, everything has become more expensive in recent years, but in particular
the rising cost of food and household goods. That's something that most Australians will have been impacted by, something that most Australians can relate to. And that's why close attention has been paid to the practices at Coals and Mollies.
I mean I have started to drive between the Coals and the Woolies to see which one will be cheaper in terms of well I mean it's just that sometimes even just between the two, there is a huge disparity, and it's because the price of everything has just gone up so much that so much is unaffordable for a weekly shop. And I have to acknowledge my own privilege that for so many they're being priced out almost entirely from buying.
From those two supermarkets.
And can you just remind me of what the actual figures of inflation are, like how much has everything gone up?
So according to the Australian Bureau of Statistics, the price of food and non alcoholic beverages, so the goods that we buy from supermarkets had risen by four point five percent in December twenty twenty three compared to the same time in twenty twenty two. So inflation rising prices are a reminder. When we say that prices rose four point five percent in December, that means that in the twelve months to that point, that's how much more expensive food
and beverage became. Supermarkets have also been accused of adding to inflation by setting their prices high than necessary, and it's.
Those higher prices that are the focus of the Senate inquiry, right.
Absolutely, so you will have probably heard the term price gouging thrown around a lot in the media, in headlines and in discussions about coals and bullies lately. So price gouging is when companies unreasonably increase the cost of their products. And what does unreasonable mean in this sense, Well, we've seen the A Triple C investigate or step in a few times before to monitor this concern around this thing
called price gouging. So, for example, remember when there were no rats, covid rats, not to be confused for the rodents, many of them plentiful. When we couldn't get any covid rats, there were some places selling them for seventy bucks a pop, and the A Triple C the Consumer Watchdog investigated in that instance, and there were rules in place saying that those retailers couldn't do that.
But it's not illegal to increase your price.
So there's a difference between increasing your prices and price gouging.
Yeah, so it's not illegal to increase your prices, but it is illegal to make false or misleading claims about why prices are that high.
Okay, So talk me through that.
So a price gouging inquiry was launched last year by the Australian Council of Trade Unions, and it said that thirty percent of submissions that it received, so it asked for members of the public to tell it what they were concerned about when it came to cost of living. Supermarkets were flagged as their main concern.
Of thirty percent of submissions.
Yeah, okay, So that then tells the a Triple C or governments or bodies that there is a community concern about prices being set in supermarkets, and then that kind of urges those authorities to look into whether or not these prices are increasing in line with inflation or as a fair and competitive business decision, or whether or not it's taking advantage of customers, and if there is transparency around that for customers.
You and I both do some slots on breakfast TV every so often on the weekend. I think that we have both spoken about supermarket inquiries maybe fifteen times.
Yeah.
I think that's because there are so many inquiries currently going on. Yeah, can you take me through them all?
It's meaningful. I think that you and I, we work in the news, we've spoken about these inquiries a lot, and even going into looking into today's episode, I was like, wait, which one. How many? There are so many so it is confusing. But let's start with the federal Senate inquiry into coals and Woolies, so that one is now underway.
Okay.
The Greens were the party that led the call for the Senate inquiry, and essentially they had accused Coles and Willworths of setting these really really high prices to drive up profits. And that inquiry, led by federal senators is examining a range of factors like the between rising profits by supermarkets and the growing costs of essentials, and whether supermarkets are falsely advertising discounts for products.
What do you mean falsely advertising discounts?
So if you think about when you go to the supermarket, and particularly in this cost of a thin crisis myself, maybe others might be really drawn to those big yellow tickets, those items that say reduced savings, things that appear to the consumer to be a bargain, a deal, particularly cheap. So the inquiry is looking into whether or not those products that are being pushed as discounted really are discounted, whether there are savings there for customers.
Are the old two for six one three exactly, or whether customers are kind of being duped into spending their money on those items specifically. Okay, so that's what the Senate inquiry is looking at. And you said it was already underway, So what have we learned so far about it?
So that inquiry has already held a couple of hearings, and farmers and growers have shared their experience with these hearings. So I think the perspective of farmers and growers suppliers is maybe missing or has been missing in this conversation. You know, we know about the relationship between the big retailers and the consumers, but that.
Is often the focus exactly.
Yeah, but the goods that are stocked on the shelves of these supermarkets come from somewhere, and that's from people like farmers. So the National Farmers Federation called these submissions to the inquiry horror stories about wholesale prices a quick refresher on the supply chain. Farmers and growers grow the produce that we eat and drink. So the apples and bananas, the cows for dairy milk, the oats for oat milk, if that's what you're into, close for my bon sooy.
They're called primary producers because that's the first step in the process. And primary produce users sell their produce to supermarkets. They sell them for wholesale prices for large quantities in single transactions. So say you know, a couple of trucks worth of peaches, which Zara would run far from. Farmers and growers have told this Center inquiry in recent weeks that the wholesale price of fruit and vegetables hasn't increased in fifteen years, despite in store prices increasing.
Wait, so I just want to stop you there.
So they're saying the price that they are selling to yeah, the price that they are selling to the supermarkets at hasn't increased in fifteen years.
Yeah, but we as.
Consumers have experienced an astronomical rise in the price of buying those goods exactly.
And these anecdotes, and you know worth mentioning this is a group of primary producers who we have heard from. It doesn't necessarily mean that these trends are across the board, but from what we've heard in the inquiry so far, that really speaks to concern that had been raised by politicians in the lead up to the inquiry that supermarkets are selling produce for a higher profit margin, but that farmers are not benefiting from those increased prices. So there's
still quite a way to go with that inquiry. Some more hearing scheduled, but it will hand down its final report on the seventh of May.
Okay. So that's just one of the inquiries. What are the other ones?
There are actually two inquiries that I'd consider the most important. So if you remember anything from today's episode, I think it should be that this Senate inquiry is marching ahead, and another one which is being led by the Australian Competition and Consumer Commission AKABA Triple C after calls from National's leader David little Proud late last year you need a tough cop on the beat that goes in and make sure that the consumer and the farmer and the
processor are being protected from big supermarkets. That one is not government led. This is an inquiry independently run by the a Triple C. It's looking into how supermarkets set their prices.
The a Triple C has significant powers to look at how things like online shopping, loyalty programs and changes in technology are impacting competition in the industry, and to examine the difference between the price paid at the farm Gate and the prices that people are paying at the checkout.
So we heard from Anthony Albanezi earlier in the year.
Today I also announced that the government will fund consumer organization Choice because across thousands of products and can be hard for people to find the best deal.
And one of its goals is to establish a sort of standardized price list for consumers of what they should expect to pay for staple grocery items versus what Colson, Woolies or your local grocer is charging for those items. Interesting those findings, however, by the a Triple C are not due until about this time next year.
And I mean that's one of the many criticisms, which is that inquiries are great, except they take an exceptionally long time and we might be out of a cost of living crisis by then, who knows. And you know, the pain is being felt right now for consumers and seemingly for farmers as well, So definitely one of the criticisms there.
Yeah, and in this sort of supermarket duopoly, as it's been coined, there is concern that the timeline on these inquiries, you know, is not going to motivate Coles and Woolworth's to do more to make things fairer or easier for consumers.
Okay, so there are a couple of federal inquiries. There's also a state one. I believe at the.
Moment Queensland is investigating on its own with a parliamentary committee.
So there's a lot going on there. How have Colson Woolies responded?
So Coles and Woolworths have been pretty firm on rejecting suggestions of price gouging this entire time in admission to the Senate inquiry. So that first government led one that we discussed. Coles we heard from firsthand in that context saying that it understands the cost of living strains Australians are under and that it tries to quote deliver value to customers and is committed to helping lower the cost of living. That's the kind of retrick that we've heard
time and time again with the supermarkets. Ultimately, they deny price gouging. They say customer value is important at the same time as meeting their increased costs supply chain costs. Woolworths have given a similar statement. They've said the company is acutely aware of the pressure inflation is placing on customers, and it added that it takes steps to provide affordable grocery products for all Australians.
We did, of course see that the head of Woolworths announced he will be stepping down, denying that it was anything to do with any of what's going on here. But again, just this increased pressure on the supermarkets, lot of eyes on them, a lot of people demanding answers. It's going to be really really interesting to see what happens and whether that makes any kind of difference material difference at least to the way the calls and will lose operate.
Each inquiry is going to hand down a final report, a review they will start coming in from, you know, may right up until next February next year. And whether or not individually those reports would mean a lot versus the kind of momentum of having.
Them in bold public pressure.
Yeah, I think maybe that elevated scrutiny could lead to some change, but these things are going to take time. Will certainly stay on the recommendations. The fallout of what happens here, the question of whether or not grocery prices will move, you know, we really can't answer that yet, which I know is disappointing people.
Someone listen to this whole podcast to get to that answer in the final dying minutes of it now answer is, we don't know.
I think that if anything, my prediction is we will see some tighter regulations, substricter reforms that will come in and ultimately they will be targeted towards making the industry fairer for all players involved, whether that's wholesaler's, retailers or you know, us, the little guys.
We will have to wait and see if Emma's predictions they're ring true. But thanks so much for joining us on the Daily Ods. If you learn something from today's episode, please send it to all your friends and tell them to hit.
Follow on either Apple or Spotify.
That is what helps us grow and at a time when news has never been more important, we value each and every one of you.
Have a great day. My name is Lily Maddon and I'm a proud Dunda Bungelung Cargoton woman from Gadigol Country.
The Daily oz acknowledges that this podcast is recorded on the lands of the Gadighl people and pays respect to all Aboriginal and Torres Strait Island and nations. We pay our respects to the first peoples of these countries, both past and present.