SUBJECTS: ACCC; FOOD AND GROCERY CODE
ALI MOORE (HOST): Dr Andrew Leigh is Assistant Minister for Competition, Charities and Treasury. Minister, welcome.
ANDREW LEIGH: G'day, Ali.
MOORE: First, before we get to the draft mandatory code, your response to the ACCC legal action launched today?
LEIGH: These are incredibly serious allegations, Ali. I mean, we're talking about 266 Woolies products, 245 Coles products, consumers would have paid millions of dollars for these products and if the specials are false specials, as the ACCC is claiming, then that's incredibly serious for what it means for consumers.
You know, just to give you one sort of concrete example, which is in the ACCC's media release, they talk about Oreos being sold at $3.50 a pack for about a year, then temporarily spiked up to $5 a pack, dropped down to $4.50, which was then advertised as ‘price dropped’. That doesn't look like a real special to me. So, obviously this will be tested before the courts, but if it's found that Coles and Woolies have breached the law, then they deserve every penalty that's thrown at them. Australians are under cost-of-living pressures they deserve to get specials that are real specials.
MOORE: Well, we've had lots of people text with examples today. I don't know who does the shopping in your family, Andrew Leigh, but have you had your own suspicions about this sort of thing?
LEIGH: Look, my wife and I do the shopping. She does the online, and I tend to do the in person. And, yeah, there was/now specials - they're certainly been something that's been under appropriate scrutiny. As government, it's not up to us to do the enforcement. That's the ACCC's job and Gina Cass-Gottlieb does a great job of it.
It's our job to make sure they have the right resources and the sufficient penalties. So, one of the first things we did when we came to office was to increase the penalties for anti-competitive conduct, raising those penalties and so they weren't just a cost of doing business. And people can see in the ACCC's media release today that they say very explicitly that for half the period in which they're looking at, the penalties are higher. A direct result of the Albanese Government increasing the penalties for anti-competitive conduct.
MOORE: Andrew Leigh, today, at the same time, as I just said, you have released a draft of legislation that essentially follows a review of a voluntary code of conduct by Craig Emerson. You followed most or all of his recommendations and this code will be made mandatory?
LEIGH: That's right. So, under the Liberals and Nationals, it was a voluntary code - effectively toothless, effectively without penalties. What we're doing now is making it a mandatory code. And so, we're getting a fairer deal, not only for families, but also for farmers. Previously, farmers had feared retribution because, who complains under a voluntary code when the risk is that you can lose your contract with the supplier? So, now we're bringing in place a code with teeth, a code that will actually get a fairer deal for farmers. We're putting in place code mediators. We're ensuring that there is an ability to complain directly to the competition watchdog, to make anonymous complaints there, and greater protections for fresh produce suppliers. If you're supplying berries to the supermarket, Ali, you've got that problem that your berries might well go off in a couple of weeks. So, we're ensuring obligations for supermarkets to specify the basis for determining prices, to conduct their forecasts with due care, and to have reasonable quality standards.
MOORE: So the arbiter will be the ACCC if there's an anonymous process for whistleblowers, if they've got a complaint, that's where they'll go?
LEIGH: Well, there'll be code mediators, currently known as code arbiters. And then there's also this additional ability for people to make an anonymous complaint to the ACCC. So, it's a much more robust code than was in place under the Liberals and Nationals. We take much more seriously than they did the allegations that are being raised by farmers and the concerns among shoppers, that they want to make sure that farmers are getting a fair deal as they supply to these major supermarkets. It's one of the most concentrated supermarket sectors in the world. We've got to do more for consumers and for farmers.
MOORE: What will be the standard of proof, though? I mean, sometimes these things are not always in black and white.
LEIGH: The standard proof will be the usual balance of probabilities as it is in the civil law. And one of the things that Craig Emerson has done is to deal with a constitutional challenge in this space by getting agreement from the four supermarkets and supermarket chains that are signed up that they will agree to the mediation process with penalties up to $5 million. It's a real credit to Craig that he's able to do that, and that allows us to better deal with disputes under the code.
MOORE: So, if a supermarket does the wrong thing by a supplier, what sort of penalty could they face?
LEIGH: $5 million. So, the agreement that they have made is that the code mediator can impose penalties going up to $5 million, and then also we have penalties that can be imposed more broadly, they will go up to $50 million.
MOORE: And when will the code of conduct come into force?
LEIGH: We'll expect that to come in the coming months. We're a consultative government. Obviously, whenever we take actions that affect stakeholders, we give them a chance to comment. People have the chance to comment on this mandatory code and to give their feedback in the way in which we've said about implementing Craig Emerson's review. Craig Emerson's the former Competition Minister. He's done a power of work on this. We want to make sure that we get the best deal we can for families and for farmers.
MOORE: Andrew Leigh, thanks for joining us.
LEIGH: Pleasure, Ali. Thanks again.