Wielding a big stick

The Commerce Commission’s final report into our grocery sector brings welcome news for shoppers and struggling local producers.

- JANE CLIFTON

At first glance, the new regulatory plan for the supermarket duopoly had one outstanding feature: the Commerce Commission sure knows how to ruin a good punchline.

It has spent the past year or so huffing and puffing in fine Big Bad Wolf tradition, but instead of blowing the two not so-little supermarket piggies’ houses down in the end, the final chapter has the piggies being nibbled at by some new “play nicely” regulations and a disputes-resolution process.

Given there’s a much bigger, badder wolf in town in the form of inflation, the government may have wished for the serious biffo the commission had portended: a forced divestment by the two uber dominant grocery chains, or a state-backed third competitor. Labour is starting to flag in the polls against a resurgent National opposition, so a chance to play “people’s champion” against the retail grocery barons would have been handy politics.

Fortunately for both consumers and long-suffering grocery suppliers who have alleged bullying by supermarkets, the angel is in the detail of the commission’s proposal. Mildly worded, it nevertheless represents an almighty big stick, which will make supermarkets among the most closely monitored and regulated sector in the country.

Officials are already drafting the requisite laws and regulations to impose a mandatory code of conduct on the supermarkets. Crucially, the supermarkets themselves will have no ultimate say over this.