Webb DuncanGROCERY INDUSTRY COMPETITION BILLThird ReadingHon Dr DUNCAN WEBB (Minister of Commerce and Consumer Affairs): I present a legislative statement on the Grocery Industry Competition Bill.ASSISTANT SPEAKER (Hon Jenny Salesa): That legislative statement is published under the authority of the House and can be found on the Parliament website.Hon Dr DUNCAN WEBB: I move That the Grocery Industry Competition Bill be now read a third time. What a great day it is for ordinary New Zealanders because today this bill will pass into law. A bill which will clamp down on the excess profits that supermarkets have been making. I want to first of all want to recognise the work that my predecessor Hon Dr David Clark did getting this bill into the House and before the select committee. He has been a stalwart and done great work in respect of this bill. It is an absolutely momentous day as we proceed to the final vote and to pass this important bill to benefit New Zealand consumers—all New Zealanders—to put money back into their pockets by giving them a better deal at the checkout. This is a key step forward in addressing the cost of living. I'll say again that this bill is necessary because the Commerce Commission's market study presented a clear finding: consumers aren't getting fair deal at the checkout due to systemic competition issues. Consumers deserve a more competitive grocery industry and this Government has taken action. There are two clear signs that our grocery markets aren't working as well as they should. First excess profits. The profits being made by the big supermarkets Foodstuffs and Woolworths—they're taking home between them more than $1 million a day in excess profits and that's keeping grocery prices higher. And that's money—that's $1 million a day that could be and should be staying in the pockets of ordinary New Zealanders to help relieve cost of living issues. Second despite consumer demand for choice and ample room in the market for a third or fourth competitor we have not seen a new entrant into the grocery market to compete at any scale for more than a decade. And only now that we are taking action are we seeing movement in the market as it becomes clear to prospective new entrants that the time is right and the ground is fertile. So consumers do deserve a more competitive grocery industry. This Government is advancing this Grocery Industry Competition Bill to give consumers a more competitive grocery industry. It signals how serious this Government is and how far we will go as far is as necessary to ensure Kiwis can buy groceries at affordable prices and can shop for the range of products that they demand. This bill will regulate the grocery industry to benefit consumers. It creates a Grocery Commissioner to monitor and regulate the industry and to keep the New Zealand public informed of what is happening. It provides a platform for retailers to enter and expand in the grocery industry by imposing requirements on the duopoly to facilitate commercial arrangements for the wholesale supply of groceries and there's a flexible toolkit of backstop measures if it doesn't work. So there's more to be done. We will remain vigilant in this space. So this will allow the commission and the Government to impose additional regulation if necessary. It also provides new protections for suppliers through introducing a grocery supply code to limit the ability of the duopoly to pressure suppliers into accepting contracts that are one-sided. The days of onerous contracts foisted on suppliers are gone. We recognise that a fair market for suppliers is a fair market for consumers and we will look to ensure this. This bill has real aims and real ambitions and we are making progress. Success will exist when there are grocery retailers genuinely and vigorously competing against each other and we are starting to see that happen and we are seeing fairer prices already. Success is an innovative grocery industry that provides consumers with clever ways of shopping saves time and effort. Success is that consumers have choice to do the full weekly shop at a single store beyond just those owned by both Foodstuffs and Woolworths and paying a fair price at the checkout. Success is when small locally owned suppliers have more options of grocery retailers that they can sell into for fair prices to get them to consumers. And success is when the excessive rise of grocery prices that we have seen which have been rising faster than inflation starts to level off—Simon Court: Off you go then—off you go and take your inflation with you.Hon Dr DUNCAN WEBB: —and that's something that we are seeing now as well Simon Court. Yes that's right. It's working. We are making progress. We are a Government of change who sees a problem and addresses it. We are not a party that goes backwards and stands still like on the other side of the House. This is a problem that has been coming for a while and the other side of the House did nothing has done nothing in the competition space because it likes to look after its mates. But we will not. We will take on the difficult problems of our economy and we will use the Commerce Commission to do it. Success looks like having a Grocery Commissioner in place and I am very confident that it will be a highly competent Grocery Commissioner with a very specific set of skills and a high degree of expertise in this sector and also the passion the desire and the competence to make the change that is necessary. I want to say that for suppliers success looks like a grocery supply code that addresses the critical pain points they're facing. If you wanted to do something useful Mr Court go and look at the exposure draft of that code and have some input into how to make the rules fair for everyone. Not just for big business but for small and medium sized business as well so that the economy works well and at the checkout people are paying the right price for the best goods and the best service. That's the main thing though. This is a massive shift for all of consumers so that they will get the best price the best quality the best range. I do want to thank the National Party for seeing that this is a useful piece of legislation for embarking on this in a constructive manner. You know so what we are seeing—we are already seeing early signs of success. Costco—admittedly a large multinational but it's seen that the time is right to compete in this market. We haven't seen a new entrant to the grocery sector for decades. The Labour Government signals that it's making change and we see a new entrant. What's more we see Supie an online-only retailer doing something innovative and new. The time is right. The ground is fertile we are having a competitive market.There are at least six retailers who have signed wholesale supply agreements in with these large supermarket chains because we are making them do it we're making the supermarkets sell their groceries to other retailers at fair prices. The Warehouse is investing in a grocery range. It has aggressively entered the market. You'll have seen their products at lower prices to entice people into their stores. It's working. What we are doing is boldly addressing what's been a long-term structural issue throughout this sector. We are laying the foundations for much-needed change. And as more players enter the market over time as unit pricing comes in—another step—this will increasingly stimulate competition on value and customers will have better access. But look this is an important step. I do want to thank the select committee under the leadership of Naisi Chen and prior to her Jamie Strange for the hard work and the members on that committee. But most importantly members of the public who had a say and who moved to make improvements to this bill and who will hopefully see the benefits of it. So thank you to all the New Zealanders who have written to me and spoken about your experiences in supermarkets and the fact that the cost of living is causing a strain. We've heard you. We're making changes and you will see a difference.I'm delighted to tell you all that this Government will be passing a bill—this bill which will have a real and positive impact on your lives every day and on your weekly grocery shop. We can all look forward to the grocery shop being easier on the pockets with less of the hard-earned cash of everyday New Zealanders going to supermarkets. It will stay where it should: in your pockets. I commend this bill to the House. ASSISTANT SPEAKER (Hon Jenny Salesa): The question is that the motion be agreed to.