March 2, 2015
The Queensland Dairyfarmers’ Organisation has welcomed today’s announcement by the Federal Government that major retailers have agreed to sign up to a voluntary Food and Grocery Code of Conduct, but says it is not enough.
The Code aims to address the imbalance of market power between supermarkets and suppliers.
QDO President Brian Tessmann said that while there were some positive signs with the Code, including a number of aspects of the draft Mandatory Code that QDO had drafted with Australian Dairy Farmers, the QDO believes it needs to be stronger, mandatory and include financial penalties for breaches.
It must also be overseen by a dedicated supermarket ombudsman.
The voluntary Code has been developed by the major retailers, Coles and Woolworths and the Australian Food and Grocery Council.
“With a raft of recent charges by ACCC against the major supermarkets, when the supermarkets had been previously stating they were doing no wrong, particularly Coles, this leaves us somewhat lacking trust in what they have put forward now,” Mr Tessmann said
“We do however acknowledge the important role the Federal Government has performed to get the Code to the point where it is today and while it is not everything we need, it does address several key imbalances of market power that retailers have over suppliers.”
Mr Tessmann said Queensland dairy farmers were among the most exposed to the actions of the major supermarkets; they still remained at risk without stronger action from the Federal Government.
“There is a long list of bad behaviour by the major supermarkets in recent years when it comes to their treatment of suppliers, advertising and pricing tactics. Past experience tells us that ‘light touch’ voluntary regulation risks being insufficient,” he said.
“The havoc wrought upon the Queensland dairy industry in the last four years is just one example why a stronger Mandatory Code is needed.
“It is unacceptable that it has taken four years, Senate inquiries, ACCC investigations, extensive court action and litigation before major retailers agreed to treat their suppliers fairly. In the last four years many business and family lives have been damaged by the practices of major supermarkets.
“The Federal Government still needs to outlaw predatory conduct of the major supermarkets.
“It is absolutely critical that the Federal Government strengthens the Competition and Consumer Act to outlaw predatory conduct such as the $1 per litre campaign by supermarkets and also to introduce unfair contract laws to provide further support for Australian small business owners.”
