The competition regulator has said that it is considering suing a big supermarket chain for breaching consumer law.
Gina Cass-Gottlieb, the Australian Competition and Consumer Commission’s (ACCC) chairwoman, said that it was “carefully looking” at a potential lawsuit, adding that “it is possible” that the watchdog will bring a court case within the next year.
Cass-Gottlieb said the ACCC would not hesitate in taking legal action against large companies and their key execs for not giving consumers a square deal.
“We think it is very important that is well understood,” she told the AFR.
The ACCC has limited powers to consider claims of price-gouging but it is looking into “was, now pricing” where chains offered superficial discounts on products after raising the price beforehand.
“That is the nature of the conduct, in terms of ‘was, now’ we are concerned about, and we get complaints about,” Ms Cass-Gottlieb said.
The news from the ACCC follows Labor announcing an inquiry into supermarket pricing as it faces pressure over the mounting cost of living.
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Prime Minister Anthony Albanese said that the government “would not hesitate to take action” if supermarkets were found not to be passing on reduced wholesale prices to customers.
“We have been clear – if the price for meat and fruit and vegetables is going down at the farm gate then families should be seeing cheaper prices on supermarket shelves too,” said the Prime Minister.
“Supermarkets have a duty to make sure they’re providing affordable options for all Australians, especially when they’re making savings on their own costs.
“If there are further steps that are needed then the government will not hesitate to take action,” he added.
Last week, Nationals leader David Littleproud labelled Coles and Woolworths the “worst corporate citizens in this country” and called for the ACCC to launch an investigation into alleged price gouging.
Littleproud pointed to cattle prices dropping by between 60 and 70 per cent in June but supermarket beef prices only fell eight per cent. Melon producers, he added, were being paid $1.50 per kilo but shoppers were being charged more than $5 per kilo.
Woolworths said in December that prices for its meat, fruit and vegetable categories were falling. The grocer also said that Australian food and grocery inflation was lower than headline inflation.
“We are very aware of the pressures facing many Australian families,” Woolworths Group chief executive Brad Banducci said at the time.
Coles said last month that fresh food sold at its stores had experienced deflation of 2.3 per cent during the July-September quarter and that the company was “always exploring ways to reduce prices on the products we sell”.
