Ross Cadell (NSW, National Party) Share this | Hansard source

I don't think Senator Sterle in that last speech made things more complicated at all; I think he made it easy. In terms of his reference to the issues the road transport industry had and bringing legislation into this place to fix it, this is exactly what Senator McKim seeks to do now. I think it has become crystal clear. We can all stand up and talk about the problems we hear on this committee. We can hear about the farmers and about the consumer costs, but it takes someone to come up with an answer, and that is what this bill is.

The Competition and Consumer Amendment (Divestiture Powers) Bill 2024 comes in with a big answer that can be a big stick to these people when they do it wrong. It's not the whim of a person. It's not because we feel like doing something today. The provisions only apply with a court appeal relating to abuse of market power or unconscionable conduct. What sort of business would be fearful of being held to account under those provisions? They are activating everyone they can to come out and say: 'No, this is horrible. This is the worst thing in the world.' The supermarkets are out there. They've got BCA, and they've got all these people out there. That's because they are fearful that they are partaking in this unconscionable conduct and abuse of market power; otherwise they wouldn't fear it so much. I notice Bran Black from the BCA said, 'The short point is the powers are an impediment to businesses growing. When the businesses don't grow, they don't hire staff.' Let me tell you, with these businesses having 67 per cent of the market share, we don't want them to grow. That is the point! Bran has got it: you have too much power. And this bill—I know the Greens don't like nuclear—is the nuclear button for when they go too far.

There'll be other things. There are other things we can do. This committee is great at looking at them. We're hearing from them; we're getting into it. But this needs to be there in supermarkets, and I would say this broad power is good enough anyway. We have an air industry where 90 per cent is controlled by two big operators. Believe it or not, live plants come under the grocery code, and Bunnings has 70 per cent of the market. If you want abuse of market power, forget the testimony that comes out in our committees. How about the testimony that doesn't come there from the producers and the processors who are too scared to talk? That's because they have two customers who are on the chopping block and they fear that, if they say something, their own businesses will be there. You don't need any evidence other than that. If people are too scared to talk about unconscionable conduct, it is happening and retribution will happen.

We hear about how this is the worst thing in the world. I think Senator McKim raised Soviet style communist power—things like that. There are OECD countries with some form of divestment power and in the United States there are violations under section 2 of the Sherman Act. Under the German Competition Act, Germany can do it irrespective of the legal conduct. They can do it on the whim; they have the power, as do France, United Kingdom, Austria, Canada, Estonia, Iceland, Israel, Italy, Japan, Mexico, Portugal, Slovenia and Spain. We are one of the few that doesn't have this power.

We hear numbers on margins from over there when we're talking about Costco but people who are too scared to come in and be sworn in as witnesses, so we can't rely on these things in our report. We heard from someone who is a controller of a pantry section, an area manager of a supermarket, say they require a 40 per cent margin in the pantry section. In the fresh food section they have told me—privately—they want a 100 per cent mark-up average across their firm. They are big margins.

Interestingly, we threw Costco into the bin. I have a processor who supplies a number of supermarkets and who supplies Costco. They went to Costco with a pricing proposal to make a 25 per cent margin on one of their products and Costco actually said, 'No, we will take 18. We give our customers between 16 and 18 per cent mark-up on this,' because they have a different business model. But that is the mark-up others are having.

I note in the ACCC review that he has power to go back and ask for two-to-three years of data—market share, margins, all these sorts of things—but has asked for five and the supermarkets will probably give that. Why? Because they have been increasing their margin for 15 or 20 years, and five years of data will not show the picture. They will show five years and say, 'Our margin has only slightly increased.' Go back 15 or 20 and they will say they have been hitting the farmers, hitting the Australian consumers bit by bit by bit. The supermarkets are addicted to increasing their margins, to taking the money and to screwing over everyone they deal with.

This has just become visible in the last few years when the suppliers and the processes can give no more. They're at their wits' end; they have no margins. We have farmers up there shaking. I was in an incident in Bathurst. I'm not proud of what I did up there. I have two guys in pig suits downstairs because I have a farmer upstairs shaking, scared about giving evidence, another one talking about 100 years of his farm and him being the last generation and another guy who walked off their farm. We have people who want to make stunts, people who want to say things that are identifying the problem but not coming up with a solution.

This bill is our solution. It is not perfect. No-one here is saying it is perfect. But, to be clear, politicians stand on the fence sometimes. Where a vote might come to today might be problematic to get this through, but I would stand on that side if this came to a vote today and support it irrespective of what the parties would do, and that is why we are here. So when Senator Sterle talks about the way they fix the trucking industry, this is just the same; it is a legislative fix to a real problem.

When we hear all these stories from a supplier, we can shoot the NFF down as much as we want but we cannot shoot the New South Wales farmers down. Their engagement is real. When they came to Orange they told horrible stories about real things like trucks being turned around after they delivered their goods because the produce didn't meet a standard—too big, too small, the wrong colour, not straight enough. We hear of consumers in Tasmania dumpster diving to get a meal because they can't afford things anymore. Once again, when we see this margin in the middle growing and growing over time, the costs getting bigger on one end and the returns getting smaller on the other end, the supermarkets never lose. They're like the casino of Australian commerce. The supermarkets never lose. I think we start with a bill like this with great powers to reflect great wrongs, and then we get down to the other things that come through in the minutia.

We talk about having arbiters for disputes with supermarkets when we go through it. But guess who appoints them? The supermarkets. If I'm fearful to give evidence about what's happening, am I going to go to someone who's appointed by the supermarket and complain about it? Probably not, because I want to be able to sell next week's crop or next month's produce. We need independent arbiters. We need proactive arbiters who go out and do audits so that growers have cover for talking to them and are not punished for talking to them. We need transparency on prices, we need transparency on margins and we need to know historically how they have increased over time while they've been screwing the farmer, screwing the processor and then getting the consumer at the far end.

Another amazing example of someone who was too scared to talk related to their olive oil. In 2012 it was $25 on the shelf and in 2022 it was $25 on the shelf. Today it is, I think, $45 on the shelf, because they've been held down so long they can't get margin. The word that supermarkets keep coming up with is 'mitigate'. 'Your costs have gone up? Mitigate.' 'Don't look at what the Australian standard is on what Australian fruit and vegetables cost. The Brazilian index on juice has only gone up 17 per cent but you're asking for a 25 per cent price rise. Mitigate.' What they're saying is, 'Buy overseas. Don't support Australian industry and don't support Australian farmers.' It is a fix. They are addicted to squeezing every cent.

There's a great boxing phrase that I learnt once about Don King, the great boxing promoter. 'A true humanitarian,' goes the phrase, 'he only wants the first 26 cents out of every quarter you earn.' That is what the supermarkets are like. They want to get everything out of you. If it's not supplying goods that perish in five days but having to supply pallets for 28 days so the supermarkets don't have to pay pallet hire. With regard to paper bags, back in the day when I used to go up to the Broadmeadow Nineways and do some shopping with Mum and Nan, we brought everything home in paper bags. The supermarkets had to start charging for plastic bags because that was an environmental responsibility. Now we've changed back to paper bags but they'll keep charging. In fact they'll charge a little bit more because there's somewhere else they can get you. That is abuse of market power.

On this side in my party we have not always recognised the threat that says when we have gone away from some single desks or trading blocs. I'm not here to defend the legacy when we are wrong, but clearly we threw growers and producers under the wheels of the truck back in the day and we see the error of that now.

If these people are truly scared of having to sell off a Big W or a Liquorland or something like that, because they do the wrong thing they will act better. If they are scared that their boards will be answerable when they lose these things, they will act better because power only likes power and only responds to power. Coles and Woolworths have 66 per cent of the market. We can talk about all the others stores, but they aren't in the same league. And the other guys, to try and compete, have to participate in some of the very same things we hate, just to try and compete with the big guys.

All of the talking points of the BCA and of the big businesses on this are wrong. They are trying to protect the status quo and they are trying to protect the size of businesses that we see as the problem. The only way to get cheaper prices and a better supply chain is to minimise that gap in the middle, minimise those margins and make better practices. It is the only way, because you can't have everything. I can't get my farmers and people of New South Wales getting better money for their produce, and consumers being able to get a better deal unless we squeeze these margins.

I commend this bill. It is a difficult thing for this side of the chamber, because it is not perfect, but it's as close as we get. I look forward to working on the committee going forward until 7 May, which I think is the reporting date, to potentially work on what we can do to adjust this, adjust other things and put in other mechanisms so that we have something that gets these supermarkets very accountable to the Australian people and very accountable to their growers. I am very pleased to be a part of this. It is probably the most enjoyable and valuing thing I've done since I've come to the chamber. We don't just want to stand up and point out problems; we want to come here with solutions. This is one. Thank you, Senator McKim. I would support this bill.