The Grocery Action Group says consumers won't see cheaper food prices until the government breaks up the supermarket duopoly. Photo: LDR / Alka Prasad
A fair prices lobby group is warning consumers won't see cheaper food prices until the government breaks up the supermarket duopoly.
The coalition is expanding its fast-track regime to include new supermarkets that could bring more competition to food aisles.
Grocery Action Group chair Sue Chetwin supported the move but said it wouldn't make a difference at the checkout anytime soon.
"The problem isn't a lack of physical bricks and mortar supermarkets, the problem is the ownership of them.
"That duopoly keeps supermarket prices high and unless we got a third operator, which is essentially them divesting some of the shops that they already own, then we will still continue to pay very high prices."
Grocery Action Group chair Sue Chetwin Photo: Consumer
On Wednesday, Economic Growth Minister Nicola Willis said Costco, which operates one store in west Auckland, had indicated an interest in expanding its operations.
Chetwin said it was true Costco had had a "small effect" in the region but there was no guarantee it would open up enough stores to be considered a third player.
"While we would welcome Costcos being in other centres in New Zealand, you won't see them in a Blenheim or Te Anau.
"They will be in big centres with reasonable sized populations. So while they it's fantastic that they are here, I don't believe that that is a game changer for prices for ordinary Kiwis."
She said it was good news the government was talking about a market-led solution being available to FoodStuffs and Woolworths, noting former National Minister Stephen Joyce had been appointed to the FoodStuffs board.
"He's on record saying in a single stroke we could fix the supermarket problem here by splitting up PAK'nSAVE and New World," she said.
The government has asked for a cost-benefit analysis on specific options for restructuring the duopoly, though there is no timeframe on when Cabinet will consider it.
Chetwin said consumers' expectations couldn't get much lower after years of persistent cost of living pressures but Willis did appear to be taking the issue seriously.
"She has commissioned these reports and the time will come when the government does have to make a decision on and structural separation or FoodStuffs and Woolworths see the writing on the wall and come up with their own plan."
"While I would like them to happen overnight, they do take time and she has committed to moving this as fast as she can."
In the meantime, Chetwin said shoppers looking at cutting their grocery bills down had few options, other than shopping in season and at local produce markets.
Night n' Day general manager Matthew Lane said the chain had no trouble getting sites so it wouldn't need need the fast-track scheme.
"I can to go to many landlords in New Zealand and be able to open the equivalent of a supermarket pretty quickly."
"The issue isn't lack of buildings, the issue is lack of competitors.
I'm just struggling to see who's going to create competition right the way through New Zealand based on this announcement."
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