Speaker 1: So we actually started doing this back in I Reckon
Speaker 1: about seven years ago when I started my PhD looking
Speaker 1: at how food prices affect families in Australia. Because without
Speaker 1: that data then you can't really go forward and advocate
Speaker 1: to governments or anyone else to do anything about it
Speaker 1: as an issue.
Speaker 2: Dr Christina Zelbus has spent years digging down see when
Speaker 2: and how the price of our food jumps. She and
Speaker 2: her colleagues are responsible for one of the only public,
Speaker 2: transparent databases on the price we pay for food.
Speaker 1: We started tracking data right before the pandemic hit, and
Speaker 1: then all of a sudden everyone was interested in the
Speaker 1: database given that it's one of the only databases that
Speaker 1: exists for public reasons.
Speaker 3: And so since the pandemic is when we.
Speaker 1: Saw some of the sharpest increases that we've seen in
Speaker 1: the last two decades. We've seen spikes in for example,
Speaker 1: like the price of lettuce and cucumber, a lot of
Speaker 1: the greens category because a few years ago, when we
Speaker 1: had the floods, a lot of those crops got wiped out.
Speaker 1: So that sort of stuff tends to make sense when
Speaker 1: you see it, But then when you look at other
Speaker 1: things like milk, going up by thirty nine percent, or
Speaker 1: chicken going up by fifty five.
Speaker 3: Percent in a three year period when it had been pretty.
Speaker 1: Stable before that. That's the sort of stuff that we
Speaker 1: don't really have an explanation for.
Speaker 2: And the priceykes of the last few years, they're changing
Speaker 2: what we buy and how much we eat. At least
Speaker 2: one study last year found one in three Australians it
Speaker 2: struggled to afford to eat properly during the year.
Speaker 3: Like, it's pretty shocking.
Speaker 1: For the first time in the last couple of years,
Speaker 1: people are buying less in that people are struggling to
Speaker 1: actually just buy food in general in Australia, Like, you
Speaker 1: can only imagine the anxiety of not being able to
Speaker 1: feed your family. The person that always pops into my
Speaker 1: head is a woman who told us that no one
Speaker 1: should be disadvantad by the food that they have to
Speaker 1: eat to be able to live in their house. But
Speaker 1: at times you have to choose between food or your house,
Speaker 1: or your warmth or internet for your children, and you
Speaker 1: shouldn't have to. You should be able to do all
Speaker 1: those things because we don't live in a third world country.
Speaker 1: But sometimes parts of Australia feel like it is so
Speaker 1: that is like how it hits on the ground for families,
Speaker 1: and that is always sort of what motivates me for
Speaker 1: doing my little part, because people are struggling and we
Speaker 1: should never lose sight of that.
Speaker 2: From Schwartz Media in seven am, I'm Ashlan McGee and
Speaker 2: this is the cost inside the living crisis. It's budget week,
Speaker 2: which means crunch time for the leaders tasked with tackling
Speaker 2: how expensive Australia is right now. And the think we're
Speaker 2: all talking about is our grocery bills. Why food seems
Speaker 2: to cost more each time we visit the supermarket and
Speaker 2: we no longer joke about instant noodles and baked beans.
Speaker 2: Today National affairs correspondent for the Saturday paper Mike Second
Speaker 2: on what some call the Great price gouge and whether
Speaker 2: the government has the appetite to tackle it. It's Tuesday,
Speaker 2: May fourteen, It's budget day.
Speaker 4: Mike.
Speaker 2: I think the time we all noticed the pain of
Speaker 2: cost of living is putting food on a plate. So
Speaker 2: talk to me about the kind of attention that we're
Speaker 2: seeing on the price of food.
Speaker 5: Oh well, it's it's just about everyone's discussion at the moment,
Speaker 5: you know, in the supermarkets. There's a great deal of
Speaker 5: public anger at the big supermarkets and how much prices
Speaker 5: have gone up. You know, you hear it on radio
Speaker 5: talk back, you see it in the TV vox pops
Speaker 5: of shoppers.
Speaker 6: You remember when calls us to do feed a whole
Speaker 6: family of four for ten dollars.
Speaker 7: You can't even get a bag of cheese for that
Speaker 7: price anymore.
Speaker 5: And for some reason, you know, in the last three
Speaker 5: months of last year, according to the Bureau of Statistics,
Speaker 5: food prices went up nine point two percent, which was
Speaker 5: the fastest rate of growth and I think thirteen nine
Speaker 5: years since from the third quarter of two thousand and six.
Speaker 5: I'm pleased to say that in the first three months
Speaker 5: of this year at the rate of rise was down
Speaker 5: a lot, to three point eight But you know, those
Speaker 5: previous increases are baked in. Food prices in particular have
Speaker 5: been going up here more than in many comparable countries.
Speaker 5: And part of the reason for this, according to many
Speaker 5: economists and others, is that Australia has one of the
Speaker 5: most concentrated grocery markets in the world. The two big players,
Speaker 5: Coals and Woolies, hold between them about two thirds of
Speaker 5: the market, and the politicians are onto this. You know,
Speaker 5: we had the Independent Andrew wilk for example, saying that
Speaker 5: it was simply unconscionable that Coals and Woolworths were raking
Speaker 5: it in while Australians had to choose between rent and food.
Speaker 6: Hard to go. And I was second the motion that
Speaker 6: government must do something about grocery prices because it is
Speaker 6: simply unconscionable at Woolworst and Cold rake it in while
Speaker 6: Australians go hungry or struggling so hard to pay for
Speaker 6: roof over their head.
Speaker 5: The Prime Minister Anthony Albanez he said earlier this year
Speaker 5: that it was quite clear that the supermarkets had excessive
Speaker 5: market power.
Speaker 8: Our government is prepared to take action to make sure
Speaker 8: that Australians are not paying one dollar more than they
Speaker 8: should for the things that they need.
Speaker 5: Both the Greens on the left and the Nationals on
Speaker 5: the right have advocated the divestiture, the breakup of the
Speaker 5: big players. You know that they should have to sell
Speaker 5: off some of their stores to new competitors to increase competition.
Speaker 5: So what's the government doing. They announced a review of
Speaker 5: what was called the Food and Grocery Code of Conduct,
Speaker 5: which is a voluntary code that the grocery business all
Speaker 5: signs up to. It's meant to keep the prices of
Speaker 5: food fair in Australia and to prevent the retails from
Speaker 5: exploiting their customers on the one hand, but particularly their suppliers.
Speaker 5: And then second inquiry, their Triple C. The Competition Watchdog
Speaker 5: has launched an inquiry and finally we've just seen the
Speaker 5: end of a month's long Senate inquiry led by the Greens.
Speaker 5: It's provided one of the best insights we've had yet.
Speaker 9: All Right, I've declared open this hearing of the Senate
Speaker 9: Select Committee on supermarket prices. I want to acknowledge.
Speaker 5: So at the heart of the Senate inquiry, I guess,
Speaker 5: was the big question of whether the supermarkets are price gouging.
Speaker 5: The supermarkets themselves of course deny that they are, and
Speaker 5: price gouging itself is not explicitly illegal, but it's a
Speaker 5: claim that an overwhelming number of people, including the people
Speaker 5: conducting the Senate inquiry, think was worth interrogating.
Speaker 2: So Mike, tell me what actually happened at this inquiry.
Speaker 2: What are we here?
Speaker 5: Well, it might be worth starting with what happened when
Speaker 5: the supermarkets themselves got hauled in.
Speaker 6: I'm Brad BENDERCI and I'm the CEO of Wilworth's.
Speaker 9: Thanks, mister Bandage. I now invite you, if you wish
Speaker 9: to make a short opening statement.
Speaker 5: People might be familiar with Brad Banducci, the Woolworth CEO,
Speaker 5: by the time he got called to the inquiry, had
Speaker 5: already had a chakra a year. He walked out on
Speaker 5: an interview with the Four Corners program, and shortly after
Speaker 5: that he announced that he was resigning from his role early,
Speaker 5: taking his millions and moving on. It's probably fair to
Speaker 5: say that Banducci is not very used to this level
Speaker 5: of public scrutiny and is not a very good performer
Speaker 5: under pressure, because he was asked by Nick mckimm to
Speaker 5: toll the inquiry. How profitable will this was?
Speaker 4: Cannuse clarify the question?
Speaker 9: Sorry, senator, Well, I'm after your ria, your return on equity?
Speaker 5: Here is the return of funds employed?
Speaker 4: Or which is in respect we look at return investments.
Speaker 9: Are you struggling with the ordinary English language meaning of
Speaker 9: the words that I'm using in my questions.
Speaker 2: I'm focusing on corporate finance, Senator.
Speaker 5: And that's what this finally got so heated with Banducci
Speaker 5: refusing to provide a figure for return on equity that
Speaker 5: McKim threatened to find him in contempt and put him
Speaker 5: in jail.
Speaker 9: There's no context to this question apart from the context
Speaker 9: where you are giving evidence to a Senate committee and
Speaker 9: it is opened to the Senate to hold you in
Speaker 9: contempt and imprison you for up to six months if
Speaker 9: you do not comply with an order of this committee.
Speaker 9: That is the context.
Speaker 5: Eventually, Benducci conceded that he just didn't know the figure
Speaker 5: that WILS measured its profitability by other measures other than
Speaker 5: return on equity. The inquiry allowed him to take the
Speaker 5: question and notice. But that isn't all that's been heard. Obviously,
Speaker 5: We've been hearing from people who are struggling. During the
Speaker 5: first of the public hearings, we heard from advocates who
Speaker 5: said that people were telling them they were skipping meals,
Speaker 5: that they couldn't afford to eat three times a day anymore.
Speaker 4: Members of our community who were nurses have reached out
Speaker 4: to us and said they're studying full time, they're working
Speaker 4: as nurses, and they're also like having to go to
Speaker 4: the bins to get food.
Speaker 5: We heard about young people who were dumpster diving, you know,
Speaker 5: jumping into bins to find food and essential items like
Speaker 5: toiletrees and sanitary pads. We also had evidence from the
Speaker 5: people who supply the big supermarkets, particularly farmers, saying that
Speaker 5: they were being screwed down by the supermarkets who were
Speaker 5: sort of setting unreasonable prices for their produce, prices at
Speaker 5: which the farmers could not make ends meet. Essentially, my
Speaker 5: full name is Michael Badcock and all one farmer who
Speaker 5: appeared before the inquiry. He was a semi retired cabbage
Speaker 5: and couliflower farmer. He claimed that other farmers weren't speaking
Speaker 5: up for fear of the backlash from the supermarket duopoly.
Speaker 6: A lot of these bis act like little hitlers, and
Speaker 6: if you upset them, you're going to suffer.
Speaker 5: And ashland. The inquiry also heard some pretty interesting research
Speaker 5: which laid out exactly how and when supermarkets raised their prices,
Speaker 5: and how those price hikes have changed how Australians eat,
Speaker 5: and how we're continuing to.
Speaker 2: Coming up after the break. What happened when Christina Zorbis
Speaker 2: took her database of food prices to the Senate Inquiry. So, Christina,
Speaker 2: you and your colleagues were actually asked to give evidence
Speaker 2: to the inquiry into supermarket prices. What is that they
Speaker 2: like and what did you want to get on the record.
Speaker 1: Yeah, I guess when you deal with politicians, you never
Speaker 1: know which way it's going to go. But they listened
Speaker 1: to everything we had to say. We gave them a
Speaker 1: presentation and all the evidence, but they asked a lot
Speaker 1: of questions around, you know, how we create better transparency
Speaker 1: in the supermarkets, what the health impacts are of rising
Speaker 1: food prices. And I don't know if you saw any
Speaker 1: of the drama around the Klog CEO coming out and
Speaker 1: saying we should be eating breakfast cereals for dinner because
Speaker 1: it's a more affordable option.
Speaker 7: It turns out that over twenty five percent of our
Speaker 7: consumption is outside the breakfast occasion, a lot of it's
Speaker 7: at dinner, and that that occasion continues to grow, as
Speaker 7: well as a snack gay occasion. But cereal for dinner
Speaker 7: is something that is probably more on trend now and
Speaker 7: we would expect to continue as that consumer is under pressure.
Speaker 1: Funnily enough, we had done an analysis in response to
Speaker 1: that showing that Kellogg cereals had gone up by like
Speaker 1: forty percent in the couple of years, so it's quite
Speaker 1: ironic that they're coming out and saying, you know, buy
Speaker 1: our products, it's more affordable than buying a meal. But
Speaker 1: at the same time they're not doing anything to absorb
Speaker 1: any costs and passing those onto consumers too. So, you know, Australia,
Speaker 1: compared to other countries like the UK, our policies are
Speaker 1: so much weaker when it comes to food, like it's
Speaker 1: pretty crazy. Globally, we actually don't perform very well at all.
Speaker 1: But the senators involved in the inquiry were very diverse,
Speaker 1: from diverse backgrounds. You had the Independence, you had Labor senators,
Speaker 1: the Green senators, and they collectively really were interested in
Speaker 1: the topic. So I really commend all of them for
Speaker 1: putting their brains together to try tackle what is a
Speaker 1: very complex issue.
Speaker 2: So, Christina, how have we ended up in this situation
Speaker 2: where you reckon our food policies are so much weaker
Speaker 2: than other countries and whose responsibility is it to fix
Speaker 2: it now?
Speaker 3: Question?
Speaker 1: And I think my question is anyone really taking that
Speaker 1: role and doing it seriously? Traditionally we know like supermarkets
Speaker 1: and food industries are really big proponents of self regulation,
Speaker 1: so they say we can do it on our own,
Speaker 1: don't worry, like, give us a guideline that's not mandatory
Speaker 1: and will decide whether we do it or not. We
Speaker 1: don't need the government to step in, So that tends
Speaker 1: to be what happens. And at a food industry level
Speaker 1: and a supermarket level, we have one of the most
Speaker 1: concentrated sectors in the world. It just means that in Australia,
Speaker 1: supermarkets can set the playing field and set the rules.
Speaker 1: So these guys have a lot of money and a
Speaker 1: lot of power. Like on the international retail stage, they're
Speaker 1: always up the top end in delivering profits.
Speaker 3: So that is different to other countries.
Speaker 1: Like I have a Greek background, so every time I'm
Speaker 1: in Green the retailers are just different.
Speaker 3: They're smaller.
Speaker 1: You go to one city, there's one, another city there's
Speaker 1: another one. And Greece pretty much went out bold and said,
Speaker 1: you know, we need your price lists.
Speaker 3: We need you.
Speaker 1: To keep one item in any product down, like you
Speaker 1: can't go inflate everything. There always needs to be one
Speaker 1: type of bread that's affordable and at a real minimum cost.
Speaker 1: And in other countries like France, I think they've actually
Speaker 1: said we're gonna find you if you don't comply and
Speaker 1: you keep doing dodgy things with your food prices. So
Speaker 1: I don't know. In Australia, like I just struggle to
Speaker 1: ever see that becoming a reality because we've had such
Speaker 1: little action and little regulation to date. But where my
Speaker 1: skepticism sort of comes forward is that we have seen
Speaker 1: so many inquiries in the food space, and we actually
Speaker 1: have so many did use at the moment, and I
Speaker 1: still don't see people's lives getting better.
Speaker 2: And so, Mike, there's a performative aspect to all of this,
Speaker 2: but it also sounds like there's a real spotlight being
Speaker 2: shown on this issue and we're hearing a lot of
Speaker 2: concentrated evidence. But does anything actually change out of this?
Speaker 2: Does anything actually happen out of this inquiry?
Speaker 4: Now?
Speaker 1: Well?
Speaker 5: As to whether supermarkets were price gauging their customers, according
Speaker 5: to the Senate Committee, the answer was yes. That's the
Speaker 5: short answer. The longer answer, of course, took one hundred
Speaker 5: and ninety five pages to tell, and it went across pricing,
Speaker 5: the impact on customers, food waste, the supermarket's relationship with suppliers,
Speaker 5: wages and conditions for workers. So it was pretty broad
Speaker 5: and it made some major recommendations but at this point
Speaker 5: it's hard to say what else, if anything, it will
Speaker 5: mean for everyday Australians and the prices we pay. And
Speaker 5: there seems to be broad agreement among the political parties,
Speaker 5: at least rhetorically, that something needs to be done, but
Speaker 5: big difference is on what it is and what it
Speaker 5: looks like. At any rate, the Albanezy government does not
Speaker 5: support many of the recommendations. It does not support, for example,
Speaker 5: the idea of busting up the big supermarkets. So at
Speaker 5: this stage the major action that we can see agreement
Speaker 5: on is making the Food and Grocery Code of Conduct mandatory,
Speaker 5: which might help suppliers but not so much shoppers. And
Speaker 5: you know, it's not likely we're going to see any
Speaker 5: unity on the other recommendations either, so you know, while
Speaker 5: the debate continues. And meanwhile, the immediate question for people
Speaker 5: who are struggling to pay for their groceries is how
Speaker 5: do you afford to eat well? And perhaps we should
Speaker 5: go then I guess to the other side of the equation,
Speaker 5: which is things like income support other cost of living
Speaker 5: relief that may free up a bit more money so
Speaker 5: that these people can afford to spend more on their groceries.
Speaker 2: Yeah, so it sounds like the government might have a
Speaker 2: little more appetite part in the pun for that sort
Speaker 2: of tinkering in the budget. But with the Treasurer getting
Speaker 2: up and delivering the budget tonight, what else will they
Speaker 2: try to do to kind of put a little pressure on,
Speaker 2: to tip the scale a little in the favor of consumers.
Speaker 5: I wouldn't make the point that even before the budget,
Speaker 5: the government has been very supportive of wage rises for
Speaker 5: the lowest paid and some of those have flowed through,
Speaker 5: and so they will make it easy to put food
Speaker 5: on the table, I would suggest. But you know, you're right.
Speaker 5: They can't directly affect food prices, but they could offset
Speaker 5: the costs in other areas, you know, which would ease
Speaker 5: the burden. For example, last year's budget included something like
Speaker 5: three billion dollars in power bill relief. It's quite likely
Speaker 5: we'll get a second round of that, not that the
Speaker 5: punters seem to notice, particularly last year when they got
Speaker 5: that relief. Of course, this may well be the last
Speaker 5: budget before the next election, not necessarily a bit probably,
Speaker 5: and it's certainly going to be setting the tone. So
Speaker 5: this is not just an economic problem for the country.
Speaker 5: It's also political problem for the government. It's a very
Speaker 5: fine line that they have to walk between providing some
Speaker 5: kind of cost of living relief and not setting inflation
Speaker 5: running again. So yeah, in summary, I guess you would
Speaker 5: say the government is not going to be able to
Speaker 5: do anything directly about the price of our groceries. But
Speaker 5: I think there will be some stuff in the budget
Speaker 5: that will open up a little space so we will
Speaker 5: have more money that we can spend on those groceries.
Speaker 2: Thanks so much of your time, Mike Pleasure Ashland Chairs. Also,
Speaker 2: in tonight's federal budget there will be a surplus, but
Speaker 2: it'll be smaller than last year at nine point three
Speaker 2: billion dollars. Some economists have been urging the government to
Speaker 2: spend more rather than banking money in this budget given
Speaker 2: the economic climate. Last year surplus was about twenty two
Speaker 2: billion dollars. And the Federal Court has decided Elon masks
Speaker 2: X is no longer required to hide videos of last
Speaker 2: month's Sydney church stabbing. The court denied an application from
Speaker 2: the e Safety Commissioner to extend a ban which Masked
Speaker 2: argued was a breach of free speech. That's all from
Speaker 2: us for today. Thanks for listening. We'll see you again
Speaker 2: tomorrow