Sue Chetwin: Grocery Action Group Chair on the Commerce Commission report revealing rising supermarket prices

Grocery prices will continue to hit Kiwi consumers and our economy hard. 

A report by the Commerce Commission shows prices are increasing again this year after appearing to stabilise last year. 

It's revealed we now pay the fifth highest grocery prices in the developed world. 

Grocery Action Group Chair Sue Chetwin told Mike Hosking the competition in New Zealand isn’t particularly healthy. 

She says that unless the two major supermarkets know that they’re going to face proper regulation or something big will happen to them, they can continue to charge high prices. 

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Episode Transcript

Speaker 1 (00:00):
A new insight back here though, into that much debated

(00:02):
supermarket sector that I told you about at the start
of the show. So this is one of the ComCom.
Some of the data bit old, which I would have
thought a question in and of itself. In a nutshell, though,
we pay more than the OECD average, and guess what
if you're in a small town, you have less choice.
So Chapwan is the chair of the Gross Reaction Group
and is with us. Sue, very good morning to you.

Speaker 2 (00:18):
Good morning.

Speaker 1 (00:19):
Is this a statutory obligation for the ComCom because this
report tells me nothing.

Speaker 2 (00:25):
Yes, it is an obligation for them to report every
year at the moment on how we're doing with trying
to bring down prices. And as you can see from
this report, no change from the first one that they
did last year. We're still playing some of the highest
prices in the world for food, and we still have

(00:46):
a geopoly situation in New Zealand. Nothing has changed, no
new entrants and therefore pretty unhealthy level of competition.

Speaker 1 (00:56):
When we say highest prices in the world, it isn't
the world, it's the OECD percent and the data is
from twenty three. Is not possible, I mean, why are
we dealing with twenty two year old data?

Speaker 2 (01:07):
Well, yeah, yes, you've had to ask the Comments Commission,
but that's that's the data that they can get. It's
not that old when you're looking at at collecting this
sort of statistics. And I guess the important thing important
thing is that there's really no change. Kiwis are still
paying a hell of a lot more than Australians and

(01:29):
say those in the UK for grocery.

Speaker 1 (01:31):
Three percent more. But that gap, as the report says,
is closing. Is there hope point being around the twenty
twenty three By the time we get to twenty twenty five,
is it possible we've closed the gap even more And
therefore if it's one or two percent, it's actually not
the end of the world.

Speaker 2 (01:46):
Well, I don't think that we have very healthy competition
in New Zealand. We have two supermarkets. They have been
under the gun for how many years? Five years and
nothing has change changed. So they know that unless you know,
they are going to be really regulated or they you know,

(02:06):
something really big happens to them, they can continue on
and then kenyways, you know, face this sort of no
competition and having to pay more at the supermarket.

Speaker 1 (02:17):
Well, when you see no competition, let me quote you
from the report. The report says, for example, in Auckland,
it's in the in the low seventies because there is
competition in Auckland, as opposed to say, ha hey, where
there's eighty eight percent of the market's dominated by the
two big players. Are people in Auckland because of that
increased competition going hey, look at our bargains. No they're not.

Speaker 2 (02:35):
No, thaty' not. But add so, what's the number.

Speaker 1 (02:37):
We're looking for when you talk about competition, what's the
number we're looking for? Fifty sixty, seventy forty two.

Speaker 2 (02:42):
So yeah, So in Australia they are moaning and you
know the government is looking at regulating when the two
big supermarkets have sixty percent. So we've got eighty eight
percent here and in Auckland, I think they've got seventy
two percent. We've got lightly decreased prices in Auckland, but

(03:02):
nevertheless still very high. So I think, you know, say
you look at a country like Ireland, there's five supermarkets there,
they've got each got twenty five percent share of the market.
If we could get even close to that, then I
think key is the benefit.

Speaker 1 (03:18):
All right, appreciate your time. So suit chepwent out of
the gross Reaction group. I don't know how they have
twenty five percent market share and that's five of them.
But there you go. For more from the Mike Asking Breakfast,
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