Ottawa looks to understand why grocery prices are so high
Posted September 18, 2023 9:32 am.
The fall session of parliament is underway, and with a big focus on making the lives of Canadians more affordable, Ottawa is starting with grocery prices.
The CEOs of Canada’s biggest chains are in the nation’s capital as ministers try to nail down why prices are still so high, despite the rate of food inflation slowing in recent months.
What everyone wants to know is when will prices actually drop.
“We have no timeline from the federal government of when we’ll actually see prices go down,” CityNews’s Parliament Hill Reporter Cormac Mac Sweeney said.
This meeting comes after Prime Minister Justin Trudeau delivered chains a Thanksgiving threat — come up with a new price plan or face the consequences, which could potentially include taxing the profits of the big chains.
Mac Sweeney says if the federal government does that, it could backfire.
“In the end, it’s not going to help prices. You can tax the companies more but then the companies will just put those prices onto the food that you buy anyway, to try and even it out. So, it might not have the intended results that we’re hearing about from politicians.”
Canadians are struggling with the increased cost of living, and in particular the price of food.
That’s why, this morning, I will be meeting with the CEOs of the 5 largest grocery chains to discuss concrete solutions to stabilize food prices.
— François-Philippe Champagne (FPC) (@FP_Champagne) September 18, 2023
He says the tax idea is just one on the table.
“If we don’t get a plan by Thanksgiving, we’ll see whether the government follows through on this threat. We don’t know what type of tax measures they’re discussing on this. We don’t know what more they plan on doing. They’ve already promised changes to the Competition Act to try and better hold grocery chains, and others, accountable for their retail pricing.”
There’s a lot riding on this meeting, besides just getting prices down. Mac Sweeney says with the Liberals trailing the Conservatives in the polls by more than a dozen points, this could hurt them if something doesn’t change soon.
Related Articles:
-
Are grocery stores greedy or a scapegoat? Group pushes back on feds’ ultimatum
-
Parliament resuming as parties jockey for position on cost of living, housing fixes
-
Canadian shoppers turn to discount retailers to fight inflation
“The government is spearheading this effort, so if we don’t see results, voters are likely going to point the finger at the federal government, as opposed to the grocery store CEOs, but that could be the battle. There could be a big PR battle between grocery stores and the federal government as to who is to blame for this.”
The Liberals also aren’t the only ones that have been harping on grocery store prices — the NDP has also been vocal on the topic.
“You’ve heard about this for months and months and months from the Conservatives and the NDP and only recently the Liberals … the NDP has really been hammering this for some time, accusing grocery chains of taking part in what’s called ‘greedflation,’ where they say, they’re taking advantage of the inflationary issues that are going on in the world right now, and marking up their prices beyond what is needed.”
However, Mac Sweeney says despite multiple studies on ‘greedflation,’ nobody has yet found that it is actually happening.
There are a number of critics, including the Retail Council of Canada, which says grocery chains are not to blame. That group suggests profit margins are apparently thin, adding the blame should be on the suppliers and manufacturers, saying 70 per cent of the price you pay goes to vendor costs.
