Select Committee on Grocery Pricing in South Australia

The Hon. R.A. SIMMS (16:14): I move:

That the report of the select committee be noted.

I want to make a few brief comments about the report, but before I do so I would like to take this opportunity to thank everybody who was involved with this committee, in particular the members of the committee: the Hon. Jing Lee, the Hon. Ben Hood, the Hon. Reggie Martin, the Hon. Mira El Dannawi, and of course Ms Leslie Guy and Dr Margaret Robinson for all of the support they provided as well.

I think it is fair to say that this committee was timely in that there is significant concern in the South Australian community around food prices and the impact that high food prices are having. I think it is fair to say also that the prevailing view of the committee was that the federal government is looking at some of these issues and so we wanted to really focus our attention on what we could recommend for the state government to do within our jurisdiction.

I feel very proud of the recommendations that have been agreed upon by the committee because I think they are very sensible and they are tangible. I will not talk through all of them but there are a few that I think are worth highlighting in particular. Some of the recommendations relate to the need to improve competition in food retailers in South Australia. There was some evidence the committee received from the Woolworths group in particular that higher food prices in South Australia were actually being driven by the preponderance of independent food retailers in our state.

The committee did not accept that assertion; rather, we thought that actually a lack of competition is one of the big factors that is driving up food prices in South Australia, and we came up with a range of recommendations that would potentially address that. One of the big issues that came to light through the committee was the impact of planning laws on grocery prices. For instance, it is becoming commonplace in some regional communities for big food retailers to buy up greenfield sites and to then put smaller retailers out of business.

One of the recommendations in the report is for the Minister for Planning to investigate potential amendments to state planning laws to prevent rezoning of greenfield sites to retail in instances where this would have a negative impact on existing businesses. We also made a recommendation for the Minister for Planning to investigate opportunities to prioritise green space in new developments, to encourage community gardens and therefore access to fresh fruit and vegetables, and also for the government to look at what it could do to crack down on the practice of land banking by major food retailers, another big issue that is contributing to lack of competition in the market.

There are some recommendations in here, too, around the state government using its procurement guidelines to prioritise smaller food retailers where it has the opportunity to do so. In addition to anti-competition, another key factor that was flagged by the committee, in terms of contributing to high food prices, was the stringent nature of food packaging standards and the aesthetic standards that are applied to fruit and vegetables and the like.

I will say that one of the things I found really fascinating about being on this inquiry was learning more about the packaging requirements that are placed on our foods. I had no idea, for instance, that Australia imposes such significant and stringent requirements on the packaging of potatoes and the display of potatoes, and the impact that might have on pricing.

For instance, in Australia we put potatoes out for sale on an individual basis, whereas in Europe they are sold in a pre-packaged bag. That, of course, has an impact on pricing locally because it means that more potatoes have to be potentially discarded if they are no longer looking aesthetic. So one of the recommendations of the committee is that the state government review packaging standards and cosmetic specifications to ensure that these factors are not contributing to unnecessary food waste.

The other proposal is that the parliament legislate to increase the social responsibility of big supermarkets, including mandating their donation of damaged food, to ensure that supermarkets are responsible for the waste they produce. I think it was concerning to hear evidence at the inquiry that some of the big food retailers are discarding food that is not aesthetic, and we are in the middle of a food crisis.

There was an example provided, for instance, of big bananas being unappealing to some consumers. That struck me as a curious proposition—I know lots of people who would disagree with that—because something like a banana could be turned into banana bread or a range of other practices. So, again, let's look at some of these factors that might be contributing to high prices, and that is what the committee has advocated.

We have also suggested there is a role for the federal government to play here, in particular looking at things like increasing migration to South Australia to provide more workers to the farming sector; looking, of course, at things like increasing income support for South Australians who are struggling; and looking at national initiatives to improve transparency.

We also make some recommendations regarding cost-of-living relief. I think the committee recognised the really valuable work of Foodbank and other organisations that provide support, but we also noted that it is not the role of these organisations to plug all of the gaps. What is needed is broader structural reform.

We have made some recommendations for things the government could do to provide more short-term relief, in particular things like expanding access to free school breakfasts and lunches and looking at ensuring that Foodbank is appropriately serviced by public transport, particularly in regional areas, and also, of course, potential legislative action on things like grocery prices, rent, energy and transport, recognising that people who are paying more money for groceries are also paying more money for rent, electricity and so on.

That is a snapshot of some of the key recommendations. All of the recommendations bar one were supported by the full committee and across party lines. I think that speaks to the fact that they are sensible recommendations. Certainly from my perspective, there is always scope to go a little bit further, but I think where we have landed is good and provides a potential road map for the government, if they wish to take it up.

I hope the government will take the time to look over this report over the Christmas break. It is a time of year when lots of South Australians will be focused on food prices and the cost of living more generally, and I hope the government can come back in the new year, having looked at this report, and commit itself to take action on some of the very sensible recommendations.

Just before concluding, I should thank all those organisations and individuals that participated in the inquiry. We engaged with all of the key stakeholders, including business. We heard from Foodland, Aldi, AUSVEG, Woolworths and Coles, and we also heard from a lot of the organisations that assist vulnerable South Australians, organisations like Foodbank, SACOSS and SA Unions. We also had an opportunity to undertake a regional trip to meet with primary producers and other key stakeholders. I should also thank the Hon. Ben Hood for his assistance in coordinating that trip to Mount Gambier. With that, I conclude my remarks.

Debate adjourned on motion of Hon. I.K. Hunter.