Smart move by NZ First

New Zealand First’s promise to break up the supermarkets and bring food prices down is a smart political move.

Respite at the checkout is something shoppers have wanted for years, and with the current oil crisis likely to push up the cost of everything, that desire will be even more urgent.

For years, successive governments, including those the party has been part of, have thundered about what is seen as excess profits from the dominant supermarket players, but any measures taken thus far have not been bold enough to make much difference for shoppers.

New Zealand First is now promising to introduce legislation to reform the system, breaking up the two Foodstuffs organisations into two nationwide co-operatives based on one brand — one for New World and Four Square and another for Pak ‘n’ Save.

These two would then compete with Woolworths.

Some commentators, including from Consumer NZ, are pointing out that while this is an enticing concept, the risks include that having two separate owners of the Foodstuff brands could drive up operational costs.

It has also suggested if Woolworths did not like the new set-up it might leave.

A 2023 report from the Ministry of Business Innovation and Employment estimated forcing divestment could improve competition but that it might cost a net $3.8 billion over 20 years, mostly because of the lost economies of scale.

There may be considerable scepticism about how successful the party might be with this policy should it find itself in another coalition with Act New Zealand and National.

National, while it has talked big about the need for competition, has forlornly pinned its hopes on a big player coming in to save the day, something never likely to happen because of the high cost for any new organisation wanting to achieve the sort of coverage of the existing threesome.

Act has been wont to see the issue as a question of too much red tape. It also voted against the introduction of the grocery commissioner.

New Zealand First, however, is keen to beef up the powers of the commissioner.

Photo: Getty Images
Photo: Getty Images
This would include increasing penalties for serious breaches to match Australia, including fines of up to $10 million, three times the gain or 10% of turnover.

The announcement of the policy does not spell out that these penalties would apply to situations where the supermarkets are found to have charged excessive prices, as they will in Australia from July.

Much more detail on the whole policy will be needed before it is clear how it might work, but the party has the advantage of being the first out of the starting blocks on this. The others will have to catch up.

Not so smart

It is no secret NZ First deputy leader Shane Jones loves excessive colourful language.

He probably thinks everyone else loves it too. Spoiler alert: they do not.

What he calls being a master of rhetoric who uses hyperbole to get cut-through, others might call cheap and cynical dog whistling which risks emboldening others to harass or attack the subjects of his self-important outbursts.

His recent comments on Reality Check Radio on the proposed trade agreement with India in which he said he was never going to agree with a ‘‘sort of butter chicken tsunami’’ coming to New Zealand are the latest in a long line of appalling statements.

Prime Minister Christopher Luxon could have shown some leadership by calling out this minister and asking him to rein in his rhetoric.

Ironically, in 2020 after Mr Jones had claimed Indian students had ruined academic institutions, National criticised then PM Jacinda Ardern’s handling of it.

She described his comments as both loose and wrong and said she would be making her displeasure known and asking him to reconsider the way he talked about these issues in future because it was not good for New Zealand.

That didn’t go far enough, according to National’s then leader Simon Bridges, who said Ms Ardern had responsibility for ministers under the Cabinet manual and should be reprimanding him.

Perhaps Mr Bridges would like to give Mr Luxon some much-needed advice.