Federal Government distances itself from election promise, dumps Grocery Choice

Posted by Daniel Palmer on 26th June 2009

The Rudd Government has backtracked on one of its key promises to the Australian public by cancelling the relaunch of the grocery price monitoring website – GROCERYChoice.

The controversial site was launched last year, with the ACCC taking the reins following their Grocery Price Inquiry. Praised as an initial success by the Government due to the number of hits in its first month, the site quickly lost the interest of the Australian public. As a result, the $13 million site – criticised as irrevelant due to being too slow to provide data, too general and too focussed on the major chains – was taken over by consumer group Choice in December.

Consumer Affairs Minister Dr Craig Emerson broke the news today, saying the plans for the site – which was to be relaunched by Choice next month – could not be achieved.

“Following a meeting today with the major grocery retailers, it has become clear to me that it is not feasible to implement the originally envisaged Grocery Choice proposal,” the Minister said in a statement.

“The Government remains of the view that consumers are better placed to make informed choices when they are able to gain access to prices conveniently and make comparisons among supermarkets,” Dr Emerson continued. “However, the Grocery Choice proposal as originally envisaged would not be able to generate reliable, timely data as a basis for consumers to make meaningful comparisons in their local neighbourhoods.”

With thousands of supermarkets and thousands of grocery items, Dr Emerson said timely information was simply unable to be provided.

“Upon close examination of the data requirements for reliable price information, I have formed the view that it is not feasible to generate that information in a timely manner,” he advised. “Less comprehensive and less timely data could be generated but it would have significantly less value to consumers.”

The Minister said he would conduct further discussions with supermarket chains regarding the possibility of an industry website capable of providing convenient grocery price data that could be audited by a government-appointed auditor.

Choice left out of the loop

With the revamped site set to go live next week the move has come as a surprise to many, none more so than to Choice – who were amazingly not informed of the decision.

“Five days before launching the new improved GroceryChoice site the Minister for Competition Policy and Consumer Affairs Craig Emerson has met with the big three supermarkets and decided that price transparency doesn’t work for them,” the consumer group said in a statement. “Choice was informed about the decision after the industry and the media were fully briefed.”

Choice Chief Executive said the site was ready to launch on time, although “of the big supermarkets” they had only received the support of Aldi and FoodWorks.

“I am shocked and disappointed at the decision by the consumer minister to side with supermarkets rather than consumers,” Choice Chief Executive Nick Stace said. “Supermarket prices are higher in Australia than many other developed countries and Choice agreed to deliver GroceryChoice because we believed we could make a difference for consumers.”

“In five days’ time the start of a revolution in supermarkets was about to begin with consumers given up-to-date information on 1000 products, rising to 5000 within weeks. To pull the site five days before launch shows that we were on the money and the supermarkets are worried about losing out to consumer demands.”

Industry response

The Australian Food and Grocery Council, which represents food and beverage manufacturers, has welcomed the move as a victory for commonsense.

“It’s encouraging to see that newly-appointed Consumer Affairs Minister Craig Emerson has allowed common sense to prevail by not proceeding with the Government’s Grocery Choice website,” AFGC Chief Executive Kate Carnell said. “The website was never going to be feasible to compare thousands of prices across thousands of supermarkets in a timely manner with any degree of accuracy.”

“The practice of constantly surveying food and grocery prices could have also undermined competition by impacting on local price flexibility.”

The Australian Retailers Association (ARA) joined the chorus of support for the axing of a site that the Rudd Government has maintained would be useful right up until its death.

“The Grocery Choice site, while initially well intentioned, provided out-of-date data and irrelevant price comparisons for shoppers,” ARA Executive Director Richard Evans said. “The Australian grocery market is highly competitive – prices can change by the hour and vary between locations.”