Nick McKim (Tasmania, Australian Greens) Share this | Hansard source

The Greens' Competition and Consumer Amendment (Divestiture Powers) Bill would, if passed, give the courts and competition regulators the power, where misuse of market power has occurred, to break up firms across the Australian economy. This would include firms in the banking sector, the energy sector and a range of other sectors including the supermarket sector. If passed, this bill would establish a framework whereby a company that is found to have misused its market power to inflate prices, to exploit supply chains or to keep out competition could be required to reduce their market power or share of the market by divesting assets.

Australia's economic frameworks have delivered a range of undesirable consequences. They are failing the Australian people. They are part of a global economic framework that is cooking the planet and rendering this planet incapable of supporting human life by breaking down our climate and destroying the ecological processes that sustain human life. They are also impacting significantly on humanity in other ways. In Australia, our economy is increasingly dominated by massive corporations that ruthlessly use their high and growing share of market power to price gouge everyday Australians while raking in billions of dollars in profits.

Folks will be familiar with the Greens making these arguments, but let's have a look at some of the other people who have made arguments that support this proposition. At Senate estimates earlier this year, the Governor of the Reserve Bank Ms Bullock, agreed with the proposition that some corporations are using a lack of competition and the cover of high inflation to increase prices above what would be required in order to meet increases in their input costs. That is an accepted definition of price gouging. Corporations raising their prices above and beyond what they have to to meet increases in their input costs is the very definition of price gouging. We have introduced this bill because we have listened to people through our communities who are struggling to afford essential products and services. Every day that this parliament fails to rein in the power of big corporations who are price gouging, more and more people get left behind. They have to skip meals; they fall behind on their rent; they fall behind on their mortgage payments; they delay vital medical appointments; they are unable to pay their power bills or their school levies.

Of course firms are price gouging across the economy, including in sectors like banking and airlines, but nowhere is this issue more stark and more impactful than in the supermarket sector. The duopoly of Coles and Woolworths holds a massive two-thirds share of the market, making Australia's supermarket sector one of the most concentrated in the world. In response to people struggling to afford essential food and groceries while Coles and Woolworths record billion-dollar profits, the Greens and, ultimately, this Senate initiated an inquiry, through the Select Committee on Supermarket Prices, into the price impact practices of the supermarket duopoly last year. We've heard from people, through that inquiry across the country, having to make impossible choices as exorbitant food and grocery prices force them to skip meals, go without healthy food and make impossible choices between paying their rent or mortgage and feeding their families.

I want to acknowledge Senator Cadell, who has been an active member of that inquiry, Senator Sterle, who's also in the chamber, and all of the other senators who are working cooperatively through the inquiry. We've heard, for example, from a Tasmanian, Danny Carney, whom I know all members of the inquiry will recall because he choked up in our hearings in Hobart as he spoke about his mum, who recently retired after a long career as an aged-care worker, and explained to the committee how, to get through retirement, she has calculated, after that long career as an aged-care worker, that she can only afford to eat twice a day. We also heard from university student Owen Gregory, who said that grocery prices are so high he can only afford to buy half the amount of groceries that he could five years ago. He told the committee that he and his friends can only afford to eat healthy food because they rescue discarded produce from supermarket bins. Along with evidence about the squeezing of consumers, we've had evidence of the supermarket duopoly using their market power to mercilessly pressure farmers and to exploit their workers.

Consumers, farmers, and workers are at breaking point. They need this parliament to take action. Across the board, witnesses to the inquiry called loudly and clearly for the introduction of divestiture powers to break up the supermarket duopoly. It is clear that we need these powers and it is clear that we need these powers now. That's why the Greens have introduced this legislation. We hope that, across the parliament, parties, senators and MPs will listen to everyday families. We hope they will listen to farmers, we hope they will listen to workers and we hope they will support our bill to put divestiture of powers into law.

When the Prime Minister was asked a few weeks ago about divestiture powers, he dismissed the idea as Soviet Union-style policy. Well, that well-known command and control economy, the United States of America, has had divestiture powers since the 1890s. The Prime Minister should make himself aware of that fact. He also should make himself aware of the fact that Ms Cass Gottlieb, the Chair of the Australian Competition and Consumer Commission, has agreed in Senate estimates that, if divestiture powers were introduced, they could increase competition in the supermarket sector and that, under economic analysis, this would bring down the cost of food and groceries in Australia. The Prime Minister also should educate himself about the recent report from the Australian Council of Trade Unions, led by Professor Allan Fels, that recommended that Australia should introduce a divestiture law to allow big business to be broken up if they misuse market powers.

Divestiture laws are not a radical or controversial idea. Along with the US, the UK has divestiture powers, interestingly introduced by Margaret Thatcher. The competition agencies of Ireland, Italy and the Netherlands have all recently used divestiture powers to require the divestment of supermarket assets in their countries in order to increase local competition in the supermarket sector and put downward pressure on food and grocery prices. So it's looking very much like Labor under Mr Albanese is out on a limb, backing in the billion-dollar profits of massive supermarket corporations over and above the interests of millions of Australians who are struggling to put food on the table.

Why could that be? Perhaps it's because Labor has accepted over half a million dollars over the last decade from Coles and Woolworths, not to mention the massive donations they get from fossil fuel corporations, big banks and the finance industry. In fact, in total, Labor has taken over $100 million from big corporations in the last decade. It's no wonder Labor is running interference for big business and for big corporations. They've trousered over $100 million in the last decade. That investment from the big corporations, from big business in Australia, is paying off in spades, because you've now got a situation where Labor is going to dig in and refuse to allow divestiture laws in this country because they want to protect the price gouging and the profiteering of big corporations. Make no mistake, price gouging, profiteering and concentrating market power is right at the top of the business model for big corporations. It's how they work. They want concentration of market power because it allows them to keep wages low, do over their suppliers and price gouge their customers.

Massive corporations are motivated by growing their profit above all else, and they definitely don't give their money away for free, but they do give away a lot of their money to the Australian Labor Party, and those donations buy them influence with key decision-makers in the government. There's also a revolving door between the Prime Minister's office and the supermarket corporations. We learned last week that the Prime Minister's former chief of staff has been hired by Woolworths to guide them through the public scrutiny that they are currently facing. Political donations, the revolving door—it's a time-honoured story in Australian politics. Here we go again.

This is a fork-in-the-road moment for the Labor Party. They've got a choice: are they going to keep backing the big corporations, who are ruthlessly using their market power to do over their suppliers, their workers and their customers, or are they going to stand with millions of Australians who are struggling to put food on the table? When the BCA, the Business Council of Australia, came out this week and said that the sky would fall in if we introduced divestiture powers, no-one was surprised by that. Of course, they're going to fight for Coles and Woolworths to retain their market share, because both parts of that duopoly are members of the BCA.

It's time for this parliament to pass divestiture laws. It's time for this parliament to prioritise the needs of Australians over corporate profits. It's time for the Labor Party to stop standing in the way of divestiture powers in this country. Divestiture powers exist in most so-called free-market economies around the world. They are a standard part of the toolkit of competition regulators and courts in the UK, the US and many other countries. Until we have divestiture powers, mark my words, big corporations will continue to gouge prices, big corporations will continue to ruthlessly use their market dominance to do over farmers and suppliers, and they will continue to put the squeeze on their workers.

To the many people in Australia who are struggling to make ends meet right now and struggling to be able to afford healthy food: know that, if you are having to skip meals, if you're living off two-minute noodles and corn chips and buying less fruit and veg, and if you're having to decide between feeding your family and paying the rent, there is a solution, but know that the solution is not proceeding because the Labor Party has decided to side with big corporations over the interests of ordinary Australians.

If the Labor Party would support this bill, it would pass through this parliament; there is no doubt about that. If Labor supported this bill or introduced its own bill to create divestiture powers, it would pass through the parliament. This legislation is a minimalist model. It would require a firm to misuse its market powers before a court could grant a divestiture order. That is a very high and established threshold. The reason Labor's not going to go for this bill is not that the threshold is wrong or the way the bill is drafted. It is simply that the Australian Labor Party is making a political choice to side with their corporate donors Coles and Woolworths—to side with the supermarket duopoly in Australia. In doing so, it abandons ordinary Australians and farmers to their fates and abandons workers to be exploited, because there is simply not enough competition in the supermarket sector. The Greens commend this legislation to the Senate.