The Federal Government will introduce laws that it hopes will stop price gouging by major supermarkets.
Delivering on a major promise from this year's election campaign, the Albanese Government is releasing draft legislation that would lead to major supermarkets facing heavy fines if they are found to be price gouging.
A report from the ACCC, Australia's consumer watchdog, earlier this year recommended action be taken against "shrinkflation", where products become smaller but are not reduced in price, as well as greater transparency on prices and loyalty programs and regulation of promotions offered by supermarkets.
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The government is now undergoing a two-week consultation with Treasury, which will last until November 3.
Whilst the report didn't say the two largest supermarkets Coles and Woolworths had a duopoly on the market, it did note, "Australia's supermarket industry is highly concentrated with an oligopoly structure, dominated by Coles and Woolworths".
Speaking during the election campaign in April, Prime Minister Anthony Albanese claimed his government would take the findings of the report seriously.
"Labor will make price gouging by supermarkets illegal," he said, whilst promising to introduce a taskforce to help introduce an excessive pricing scheme, which would then be policed by the ACCC.
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Coles reported a profit of $1.08 billion at the end of the 2024-25 financial year, whilst Woolworths had a profit of $1.4 billion.
In ALDI's most recent financial report in 2023, it recorded a profit of $402 million.
The new laws introduced by the government today are the second political move to regulate supermarkets, with the Competition and Consumer Amendment (Make Price Gouging Illegal) Bill currently before the Senate.
Coles and Woolworths are also facing a joint class action over allegations they misled shoppers with discount pricing claims.
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