NSW Farmers Applaud Mandatory Food and Grocery Code, But Call for Further MeasuresNSW Farmers Applaud Mandatory Food and Grocery Code, But Call for Further Measures NSW Farmers have welcomed the introduction of a mandatory food and grocery code of conduct, recognizing it as a step forward for farmers and families. However, they emphasize that more needs to be done to address Australia’s supermarket problem. The voluntary code of conduct introduced in 2015 lacked binding power. The new mandatory code aims to protect suppliers from unreasonable demands or threats by supermarket chains, with penalties of up to $10 million or three times the financial gain from violations. Companies with an annual turnover of $5 billion, including Woolworths, Coles, Aldi, and Metcash, will be subject to the code. NSW Farmers Horticulture Committee chair Jo Brighenti-Barnard praised the government’s adoption of recommendations by former Labor Secretary Craig Emerson, including mandatory code and increased penalties. However, she stressed that there is still room for improvement. “Meaningful competition reform is needed to ensure Australian farmers and families have a fair chance at the till,” said Brighenti-Barnard. She highlighted concerns about farmers being afraid to speak out against supermarkets and called for independent mediators and arbitrators to address disputes without fear of retaliation. The Greens criticized the code, arguing that it will not lower food prices. They proposed a bill to give the Australian Competition and Consumer Commission (ACCC) the authority to break up major supermarket chains to increase competition and reduce prices. Despite these concerns, the mandatory code is seen as a positive step towards fostering fairer practices in the food and grocery sector. NSW Farmers and other stakeholders will continue to advocate for additional measures to improve the situation for Australian farmers and consumers.
NSW Farmers say the introduction of a mandatory food and grocery code of conduct will be a positive step for farmers and families, but they say more needs to be done.
In 2015, a voluntary code of conduct for large supermarket chains was introduced to improve standards of business conduct in the food and grocery sector. However, it is not binding in principle.
On Monday, July 1, the federal government announced that it would impose new obligations on supermarket chains to treat their suppliers fairly, or face fines of $10 million or three times the financial gain from the violation.
The soon-to-be mandatory code will put an end to unreasonable demands or threats by supermarkets on suppliers and will apply to companies with an annual turnover of $5 billion.
This threshold means the code applies to Woolworths, Coles, Aldi and Metcash, the company that supplies many independent supermarkets.
Craig Emerson. Image: The Australian.
The mandatory code was the top recommendation of a review conducted by former Labor Secretary Craig Emerson.
The government will adopt all 11 of Dr. Emerson’s recommendations.
While making the code mandatory, significantly increasing penalties for breaches and providing better support to farmers in disputes with supermarkets are positive steps, NSW Farmers Horticulture Committee chair Jo Brighenti-Barnard said there was still a long way to go in solving Australia’s supermarket problem.
“We welcome this report, which confirms what we have been saying all along: meaningful competition reform is needed to ensure Australian farmers and families have a fair chance at the till,” Ms Brighenti-Barnard said.
Image: thegilgandraregion.com
“For too long, farmers have been afraid to speak out because of the enormous power of these two big supermarkets. Options for independent mediators and arbitrators who can determine enforceable remedies are a good step, but farmers must be able to use them without fear of retaliation.
“It is vital that farmers play an active role in developing this mandatory code so that it is practical and fit for purpose.”
The report’s findings included huge fines for code breaches – something NSW Farmers had sought – but Ms Brighenti-Barnard said courts rarely imposed the maximum penalty.
“As long as farmers sell their fresh food for a few cents per kilo and supermarkets charge families a few dollars per kilo, we will all continue to feel the pain,” Brighenti-Barnard said.
Jo Brighenti-Barnard. Inage: The Northern Daily.
The Greens also claim that the code of conduct will not lower food and grocery prices.
“Food and grocery prices won’t come down unless we make price-gouging illegal and create powers to break up the supermarket duopoly,” said Greens economic justice spokesman Nick McKim.
“We will put our divestment bill to a vote this Wednesday.”
The bill would give the ACCC the power to break up major supermarket chains, in a move they say is intended to end the reduced competition that has resulted from Australia’s supermarket duopoly.
“Divestment powers exist in many free market economies around the world, and the ACCC chairman has confirmed that greater competition in the supermarket sector would reduce food and grocery prices.”
