Liberals split on Coalition’s supermarket divestiture policy
Peter Dutton’s Liberals are split on the Coalition’s plans to crack down on supermarket chains price gouging, with several MPs warning adopting the Nationals party’s preferred policy appears “driven by politics”.
On Wednesday the Nationals leader, David Littleproud, acknowledged that there were “a lot of views” in the Coalition, arguing “that makes better policy” and Liberals’ concerns had already been addressed by various safeguards in the plan.
Under the Coalition proposal, supermarket and hardware chains could face being broken up as a “last resort” for repeated price-gouging.
Dutton announced the policy on Tuesday after briefing the Coalition party room, during which about half a dozen Liberals spoke against the plan or raised concerns.
These included centre-right powerbroker Alex Hawke, former assistant agriculture minister Richard Colbeck, MPs Keith Wolahan and Rowan Ramsey and New South Wales senators Dave Sharma and Maria Kovacic.
Related: Supermarket chains could be broken up for price-gouging as ‘last resort’ under Coalition proposal
They questioned how the policy aligned with Liberal values, warned against unintended consequences – including that costs of litigation would be passed on to consumers – and argued for a holistic competition policy rather than a sector-by-sector approach.
Hawke’s contribution was described as “heated”, “passionate” and said to have given “both barrels” to Littleproud.
In favour of the policy were Liberals including MPs Aaron Violi, Nola Marino, Garth Hamilton and several Nationals.
One Liberal told Guardian Australia that it “feels like the Nationals tail is wagging the Liberal dog, which is unhelpful for Liberals”.
That parliamentarian said the idea came “out of left field”, that people were “pretty exercised” in the party room and that they were “not sure the concerns were addressed” before the announcement of the policy.
Another Liberal said there was “surprise that Peter Dutton arrived at that position” given he had previously expressed reservations about the policy.
Safeguards included in the policy suggest it may have been “driven by politics” just to generate a “headline”, they said.
Another Liberal said that “regulation costs money, and if costs are applied to the system then it is either the farmer or the consumer that pays that”.
That person criticised both Coalition policy and Labor’s decision to implement the Emerson review, which proposes higher monetary penalties for breaches of a compulsory grocery code of conduct.
Neither will “drive competition” by giving growers and producers more transparency about costs in the supply chain, they said. “A lot of promises are being made to people that I don’t think will be kept.”
The Coalition’s policy has been months in the making, with Liberals in shadow cabinet airing differences of opinion publicly including the shadow finance minister, Jane Hume, warning that there was “always concern with divestiture powers whether they will actually decrease prices”.
On Tuesday the shadow treasurer, Angus Taylor, said the power would only be applied where divestment “can lead to a substantial improvement in competition”, and a public interest test that would apply to ensure any benefits of divestment would not be outweighed by loss of jobs or significant loss of shareholder value.
Littleproud said “the divestiture power is not something that we would walk in and split up the supermarkets tomorrow”.
“That’s not going to happen,” he told ABC TV. “It’s only if they do something wrong and they’re in breach of section 46 of the Consumer and Competition Act, and then there are safeguards to make sure there aren’t job losses.”
Asked about reported criticism from former Liberal Victorian premier Jeff Kennett Littleproud claimed “[Kennett] hasn’t even read the policy”.
On the split in the Liberals, Littleproud said “there was a lot of views … and that makes better policy”.
“That’s what fed into us making sure that we put those safeguards in place. That’s how you get better policy, not by demonising people and intimidating people.”
