Latest / Best of Business / Catherine Beard: BusinessNZ Director of Advocacy on National's plan to split up Foodstuffs to drive competition

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Catherine Beard: BusinessNZ Director of Advocacy on National's plan to split up Foodstuffs to drive competition · Best of Business

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  Speaker 1: You're listening to a podcast from Newstalk ZB. Follow this
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  Speaker 2: Now the Finance Minister is getting blowback and it's coming hard.
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  Speaker 2: Catherine Bear, Business NZ with us this morning. Catherine, good morning.
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  Speaker 2: Good morning. So you've mentioned the oil and gas ban
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  Speaker 2: here all over again. Why is that?
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  Speaker 1: Look, this is hugely alarming, particularly coming from one of
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  Speaker 1: the major political parties. To threaten to take private property
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  Speaker 1: and split it up is a very dramatic thing to do.
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  Speaker 1: And it sends an incredibly concerning signal right through the
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  Speaker 1: business community in every sector. And it sends a terrible
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  Speaker 1: signal to international investors that be careful what you do
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  Speaker 1: in New Zealand because the government could come along and
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  Speaker 1: actually take your business essentially. I think the other thing
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  Speaker 1: to think about here is there's no surety that this
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  Speaker 1: would actually reduce costs for consumers. In fact, it might
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  Speaker 1: increase costs because you have to remember we've got a
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  Speaker 1: very big country with a very small population, a lot
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  Speaker 1: of territory to cover, and if you're just duplicating systems,
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  Speaker 1: you're actually just adding costs into the system.
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  Speaker 2: Is this Banana Republic stuff, Catherine?
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  Speaker 1: It seriously is, you know. We're starting to look a
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  Speaker 1: bit like Venezuela because you've got a lot of the
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  Speaker 1: political parties falling over themselves to make these sort of
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  Speaker 1: announcements and it's not just confined to supermarkets, frankly.
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  Speaker 2: The Minister has said that the supermarkets have a big
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  Speaker 2: and expensive lobby group. Foodstuffs is one of your members.
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  Speaker 2: You are a lobby group, essentially. Are you out there
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  Speaker 2: this morning keeping prices high screwing Kiwi consumers, laughing all
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  Speaker 2: the way to the bank.
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  Speaker 1: Look, I think the other thing that they haven't actually proven,
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  Speaker 1: and the Commerce Commission itself acknowledges this, is we don't
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  Speaker 1: even have a definitive study that says a basket of
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  Speaker 1: New Zealand supermarket goods are more expensive than anywhere else
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  Speaker 1: in the world, because most countries in the OECD, like
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  Speaker 1: the majority, do not put a tax on food. New
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  Speaker 1: Zealand has a 15% tax on all food. So, you know,
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  Speaker 1: we would argue, actually, if you take the GST off,
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  Speaker 1: we're actually very competitive with a basket of goods anywhere
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  Speaker 1: in the world. So, you know, they really haven't, I
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  Speaker 1: don't think, proved the case that there's a problem here.
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  Speaker 1: You know, yes, we've had food inflation, but so has
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  Speaker 1: the rest of the world. And the last Comcom report
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  Speaker 1: says that our food inflation is pretty much in line
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  Speaker 1: with the UK and Australia. So... really they could intervene
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  Speaker 1: and do more harm than good.
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  Speaker 2: What other industries do you think would be nervous this morning,
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  Speaker 2: having listened to Nicola Willis yesterday?
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  Speaker 1: Well, any big sector really. So they've already had a
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  Speaker 1: crack at the banking industry. We've got New Zealand First
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  Speaker 1: threatening to break up the Gentailers. Again, we feel like
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  Speaker 1: that could be an own goal. You know, again, you
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  Speaker 1: can lose your efficiencies of scale. And, you know, that
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  Speaker 1: is a market that everybody has seen deliver. And, you know,
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  Speaker 1: the facts are there to prove it. Very competitive electricity
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  Speaker 1: prices over the last 20 years. It's a state market.
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  Speaker 1: And there's a bunch of reasons why investment was a
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  Speaker 1: bit slow to come on board, but to really go
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  Speaker 1: in and break things up. And, you know, it's, yeah,
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  Speaker 1: it's destructive, really. And, you know, New Zealand just ends
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  Speaker 1: up going sideways. And international investors who want to come
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  Speaker 1: here and build new things go, well, we can't trust
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  Speaker 1: that economy anymore.
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  Speaker 2: Catherine Baird, Business New Zealand.