CathNews New Zealand

The Catholic Church’s Auckland Justice and Peace Commission told a Parliamentary committee on Wednesday that land games and delaying tactics by a supermarket duopoly is hindering the lease of land to other food distributors is not helping bring down grocery prices.

It is one of several points the Commission made to Parliament’s Economic Development, Science and Innovation Select Committee.

The Parliamentary Committee is trying to reign in the excessive market power of the supermarket duopoly.

“The supermarket duopoly combined with the slow train wreck of the housing crisis has families scrambling to find enough money for food and other basics,” says Peter Garrick, the Executive Secretary of the Justice and Peace Commission of the Catholic Diocese of Auckland.

Garrick told the Committee that the slow train wreck has been allowed to happen under the unwatchful eyes of repeated governments of varying political colours.

Accompanying Garrick was Lorraine Elliott, the dioceses Vicar for Social Impact and Communication.

Speaking for the most vulnerable, Elliott reinforced one of the findings of the March 8 Commerce Commission’s study showing major grocery retailers were earning $1m daily in excess profits.

Elliott said where food makes up a major part of the weekly budget families are being held hostage to unfair prices for food and other basics.

Favouring regulation as a way of control, Elliott said Māori and Pacifika communities are particularly vulnerable.

Supporting the Grocery Sector Covenants Amendment Bill, the Justice and Peace Commission wants to see the Bill strengthened in three areas –

• framing the prohibition on the anti-competitive covenants more broadly so that other forms of retail do not continue to suffer
• ensuring lease agreements that feature various types of rights of first refusal (ROFR) don’t hinder the lease of the land to another supermarket or food distributor without significant penalty
• ensuring supermarkets can’t unreasonably delay new developments by endlessly raising objections to the District Plan or the Resource Management Act.

“Alleviating the exploitation of consumers by the present supermarket duopoly won’t be an easy fix. It will take determined, careful effort on many fronts in order to make a difference,” warned Garrick.

The Commission is urging the Government to prepare legislation to establish a dedicated regulator for the grocery sector that will –

• ensure access to wholesale grocery items for new grocery chains
• establish an enforceable code of conduct between major retailers and suppliers to prevent exploitation
• facilitate planning regulations about supermarket development so that developments are not endlessly delayed.

Garrick told CathNews that he does not think it will be easy to rein in these two giants – even in Australia where there is a third chain, the two main players have 82% of the market and have very aggressive policies to expand their retail range and use restrictive covenants to keep out others.

However, the Commission remains committed to doing what it can to speak up and help protect the most vulnerable.

Source

• Supplied: Auckland Justice and Peace Commission.

Additional reading

News category: New Zealand.