Grocers to offer discounts, price freezes on food, but Champagne offers little detail

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This article was published 05/10/2023 (1088 days ago), so information in it may no longer be current.

OTTAWA – Industry Minister François-Philippe Champagne says grocers will offer discounts, price freezes and price matching as an initial step to stabilize grocery prices.

But the minister did not provide any other details, including what products will be subject to promotions.

“Starting soon, Canadians will be able to see rollout of actions, such as discounts across a basket of food products, price freezes and price-matching campaigns, to name a few,” Champagne said, adding that he has already started to see some of these promotions being offered.

When pressed by reporters on how Canadians will know these promotions are any different than the ones regularly offered by grocers, Champagne said he does not want to disclose what each company has pledged to do.

“I’m saying those are examples of what we see in the plans, because I want the market to compete. I cannot say I received that from Loblaws, I received that from Metro, I received that from Costco, I received that from Walmart,” he said.

“Each grocer has different actions. So it will be up to Canadians to judge them.”

The Liberal government called on Canada’s major grocers last month to present a plan to stabilize prices by Thanksgiving, or face consequences,including potential tax measures.

Champagne said Thursday that the federal government is still ready to act on that threat if grocers do not take sufficient action.

Rising grocery prices have been a major pain point for Canadians and tend to disproportionately affect lower-income families who spend more of their income on food. Grocery price inflation has slowed recently to 6.9 per cent in August.

But food prices continue to accelerate faster than the rate of overall inflation, which came in at four per cent last month.

Champagne announced other steps the government is taking, including tasking the Office of Consumer Affairs to establish a “grocery task force” that would monitor the implementation of the grocers’ plans.

The industry minister acknowledged, however, that the long-term solution for grocery prices is to promote competition in the sector.

“Hopefully even we can have international (companies), which may want to come to Canada. And I’m going to talk to them and say, ‘listen, Canada is a great place to do business.’ If we have more people in the market, Canadians will benefit from that,” he said.

The Liberals recently introduced legislation that would make several changes to the country’s competition law, aimed at cracking down on anti-competitive behaviour and making it harder for harmful mergers to be approved.

The federal government has also promised to carry out a bigger overhaul of the Competition Act, but no timeline has been given for this modernization.

A former Competition Bureau commissioner Melanie Aitken slammed the federal government for the approach it has taken with grocery prices.

Speaking at a conference hosted by the Competition Bureau on Thursday, Aitken said the federal government is choosing to ignore more glaring problems affecting grocery prices, such as the supply management system.

“Supply management is one of the ones that really gets my goat. Candidly, I think it’s a disgrace. Think of what this state-sponsored cartel has done to … food prices,” Aitken said.

“Instead, it’s better to have a perp walk of the grocery execs, bang their heads together and demand the plan by Friday before Thanksgiving dinner, no less.”

Canada’s supply management system controls the supply of dairy, poultry and eggs through price and import controls.

Other ministers provided updates on their files during the news conference, too.

Finance Minister Chrystia Freeland announced the launch of public consultations on lowering the criminal rate of interest.

The spring budget announced the federal government was cracking down on predatory lending by lowering the criminal rate of interest to 35 per cent from 47 per cent. These consultations will look at whether that rate should be further decreased.

Meanwhile, Treasury Board President Anita Anand announced a new managers’ guide for public servants on when to contract professional services and when to use internal resources.

This report by The Canadian Press was first published Oct. 5, 2023.