Australian supermarket chains Coles and Woolworths have agreed to appear at the Senate inquiry into supermarket prices in 2024.
The move comes after Australia’s Green party said that it would lead a parliamentary inquiry into “price gouging” [the practice of raising the costs of goods or services by more than is reasonable or fair] by supermarkets as the country battles with high costs of living.
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The inquiry will examine the impact of market concentration on food prices and the pattern of pricing strategies used by the two retailers.
It will also assess the impact of inflation on essential items, the authenticity of discounts offered and the inflation of profits during the cost-of-living crisis.
For the year to June 2023, Coles’ profit grew by 4.8% to A$1.10bn ($734m) while Woolworths’ profit rose by 4.6% to A$1.62bn.
Greens economic justice spokesperson Senator Nick McKim stated: “Coles and Woolworths are making billions in profits by price gouging in a cost-of-living crisis.
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By GlobalData“For too long the big supermarkets have had too much market power. This allows them to dictate prices and terms that are hitting people hard. It’s time to smash the duopoly.
“Coles and Woolworths are making billions in profits because they feel that they can overcharge people without repercussions. It needs to end.”
In response to the allegations, Coles said that it continues to focus on offering value to Australian households and families and reported a decline of 3.1% in the rate of food price inflation for the July to September quarter.
Coles CEO Leah Weckert said: “We continue to invest in providing great value to our customers, supporting our network of more than 8000 suppliers and providing employment to more than 120,000 Australians right across the country.”
Woolworths, which directly employs 180,000 team members in Australia, is committed to offering good value to customers and to collaborating with suppliers to mitigate inflationary pressures, according to a spokesperson quoted in the Guardian.
Woolworths Group CEO Brad Banducci stated: “We welcome the opportunity to explain to the senate how we are working to balance the needs of our customers, our team and our suppliers in the context of economy-wide inflationary pressure”.
