Media release – ACTU, 6 February 2024
Professor Fels’ report shines a light on price gouging and unfair pricing
Last August, the ACTU launched an inquiry into price gouging and unfair pricing practices, chaired by former ACCC Chair Professor Allan Fels AO. The inquiry has conducted public hearings in Melbourne, Sydney, Adelaide, Cairns, and Canberra, receiving over 750 public submissions and more than 20 detailed contributions from academics, experts, think tanks, unions, businesses, and their representatives.
Professor Fels’ report examined a broad suite of industries, including banks, wholesale electricity and retail pricing, early childhood education and care, supermarkets, and electric vehicles.
His report found that:
- Corporate profits have added significantly to inflation and some businesses have too much power over their customers, their supply chain, and their workers.
- Many businesses are resorting to dodgy price practices, including loyalty taxes, drip pricing, excuse-flation, rockets and feathers strategies, and confusion pricing.
- A range of sectors are insufficiently competitive or insufficiently regulated, leading to poor consumer outcomes and higher prices.
The report makes 35 key recommendations: 6 relate to prices, 4 relate to mergers and divestiture, 5 relate to competition policy, and 20 relate to issues in specific industries examined in the report.
Professor Fels has handed his report to the ACTU and will also hand a copy of his report to the Government later today.
Quotes attributable to ACTU Secretary Sally McManus:
“We welcome Professor Fels’ report and note that it has found what working people suspected. Some big businesses have added to inflation and have too much power over customers, workers, and supply chains. This needs to be reined in.
“The gaming of the system in the wholesale energy market is particularly concerning. Generation makes up 30% of our household bills and Fels asserts there is gouging in the system which is causing workers to pay too much. Action here could have an immediate effect on our cost of living.
“The Inquiry itself already had a significant impact by shining a light on pricing practices that rip off ordinary people, such as those used by supermarkets. We are glad the Inquiry’s findings and process played a part in the Treasurer’s recent referral of the supermarkets to the ACCC.
“We thank Professor Fels for his deep and considered look at pricing in our economy and we look forward to considering his findings in detail.”
Prof. Fels’ Address to NPC – 7 February 24
InquiryIntoPriceGouging_Report_web[9] (1)
Media release – Greens Senator Nick McKim, 7 February 2024
Fels report shines light on price gouging and inflation
The Greens welcome the findings of the comprehensive report led by Professor Allan Fels AO on the disturbing practices of price gouging and unfair pricing within Australia’s major industries, including the supermarket sector.
“The findings of Professor Fels’ report are a testament to the urgent need for reform within our supermarket industry and beyond,” Greens Economic Justice spokesperson Senator Nick McKim said.
”It confirms what many Australians have long suspected – that excessive corporate profits and monopolistic practices are contributing significantly to the cost-of-living crisis and undermining our social fabric.”
“Professor Fels was clear that there is a lack of competitive pressure in the supermarket sector and that Australia needs divestiture laws to break up big business.”
“The Greens could not agree more.”
“There is no doubt that corporate profiteering is occurring in Australia. A corporate super-profits tax would help rein it in and provide extra revenue for the government to help people struggling to make ends meet.”
“The upcoming Senate inquiry into these matters will be a pivotal moment for supermarket CEOs to face public scrutiny.”
”We intend to examine into the issues highlighted by Professor Fels, ensuring that the CEOs of these corporations answer for their actions.”
“We thank the ACTU and Professor Fels for this important report.”
Ben Marshall
February 7, 2024 at 16:48
I have questions …
When will anyone in Tasmanian politics or media call out and name our state’s appointed Jurisdictional Planner of the energy sector, TasNetworks, for using supernormal profits to gouge some of Australia’s poorest electricity users by around 10% over-and-above reasonable profits?
When will anyone call out the massive conflict of interest in giving TasNetworks power to do this, AND make us pay for a new grid they’ll profit from – the Marinus cable and the North West Transmission Development (NWTD) which will export privately owned Tasmanian wind energy to the Mainland at our cost?
When will anyone sound the alarm on the bunfight between the state government’s greenwashing department, ReCFIT, and TasNetworks as to who will have total control over the vast swathe of north-west Tasmania with the proposed Renewable Energy Zone there?
TasNetworks is already egregiously conflicted, yet more power is set to devolve to a corporation which is happy to lie that Marinus and the NWTD will benefit us, is apparently ripping us off via our power bills and is aggressively working behind the scenes to ‘seize power’ from ReCFIT which is currently, nominally, in control of the REZ’s.
The energy sector isn’t just a mess that is utterly failing us and failing to address climate concerns! It’s run with cut-throat corporate practices by Tasmania’s own “Alan Joyce”, namely Sean McGoldrick. When will anyone in media or politics hold him and his backers in government to account?
Here are the relevant links to the issues of supernormal profit-taking in the energy and transmission sector.