Greens Think Tank Pitches $25bn Public Supermarkets to Cut Grocery Bills
The Green Institute says "Fair Go Grocers" could cut the cost of essentials by up to 30 per cent. Here is what the plan involves, what it costs and what critics say.
What is being proposed
The Green Institute, the research arm of the Australian Greens, wants the federal government to create a non-profit supermarket network. Led by former MP Max Chandler-Mather, the institute says it would use new forced divestiture laws to take over more than 200 Coles and Woolworths stores and three distribution centres.
The government would also fund 424 new supermarkets and 10 more distribution centres. The goal is a 20% share of the market. The plan is modelled on New York Mayor Zohran Mamdani's pledge to open five city-owned grocery stores.
Where the 22%, 25% and 30% figures come from
The headline savings figures vary between reports, so it helps to separate them.
- The Guardian reports Chandler-Mather saying shoppers would save as much as 22% on the average shop. That is about $60 a week for a household of four.
- Nine reports institute modelling that a family of four would save $3134 a year. That is broadly in line with the weekly figure.
- The ABC and Nine report the institute's claim that the cost of essentials could fall by 30%, because the stores would not need to turn a profit.
In short, the 30% applies to essentials such as fruit and vegetables, bread, milk and meat. The smaller figure covers the average basket. These are the institute's own estimates, and the sources do not include independent verification.
How it would work
A statutory authority would set prices each month and minimum wholesale rates for suppliers. Its members would include experts in supermarket operations, nutrition and food science, and farming. Stores would go to areas of highest need.
The federal government would pay the capital costs, including land, construction and acquisition. After the five-year investment, Chandler-Mather says the stores would be self-funded. The ABC reports they would run effectively at cost. For scale, he compared the price with half the cost of a single AUKUS submarine. The Guardian notes the government spends about $24 billion a year on the Pharmaceutical Benefits Scheme.
The case for and against
The institute points to Coles and Woolworths profits. Coles posted a $1.09 billion net profit last financial year and Woolworths $1.14 billion. A competition watchdog report last year found the pair had increased profits and had little incentive to compete on price. It did not call those profits "excessive" and did not conclude they held a duopoly.
The supermarkets deny price gouging. They cite eight separate inquiries that found no evidence of it, and Coles says it makes less than three cents on the dollar in profit. Nine notes the cost would further strain the federal budget. Institute of Public Affairs economist Adam Creighton earlier called Mamdani's plan "completely ridiculous". In New York, a local business group has sued Mamdani, arguing small grocers could not compete.
The institute commissioned a YouGov poll of 1500 voters. It found 94% were concerned about grocery costs and 84% supported publicly owned supermarkets. The poll was commissioned by the Greens' own think tank, and the question was asked with background on Mamdani's plan.
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What happens next
Nothing in the sources suggests the government has adopted the idea. Greens leader David Shoebridge has welcomed it. Chandler-Mather says Labor's anti-price gouging laws, which began in July, have not lowered prices.
For shoppers, nothing changes at the checkout for now. The proposal is a pitch for debate, and any move to force store sales would need government backing and legislation.
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