She's got to the nub of the problem, which is basically red tape.
Governments of all stripes, including her, have been quick to point the finger at private enterprise for high prices.
And there's truth in that, but most haven't looked in the mirror like Willis did yesterday and admit it's them that also has a problem.
We all do, really.
Everybody moans about prices but then moans about construction of anything new - not in my backyard.
Consultation up the wazoo, committees, petitions, Duncan Webb on a soapbox - that's democracy. Like Churchill said, the lesser of two evils.
It's taken them two years to get here, but they could have just listened to our interview with the former Managing Director of Costco back in March - he told us all this then.
The other big problems were real estate prices and shipping - getting goods here on their timeframes.
I predicted this (humble brag) all last week. They'll tinker round with fast-track and consumer laws and plaster their pressers with the threat of breaking up the duopoly. Divestment. Forcing Pak'nSave to sell some stores to a new entrant, forcing Foodstuffs to sell some distribution centres.
What I said last week is still true now, ACT won't go for it.
Plus, the even the Commerce Commission said it's risky as. Cost could outweigh benefits.
So, Willis should stop with the threats. If you own a supermarket right now and your livelihood is being threatened, are you going to invest? Hire staff? Plan expansions?
The threat is purely political and could end up doing the opposite of what Willis wants it to.
Put it in the bin.
Ryan Bridge is a New Zealand broadcaster who has worked on many current affairs television and radio shows. He currently hosts Newstalk ZB's Early Edition - where this article was sourced.
3 comments:
Ryan hits the troublesome nail on the head.....
"It's taken them two years to get here, but they could have just listened to our interview with the former Managing Director of Costco back in March - he told us all this then."
That's 2 years Willis has allowed the nz grocery cartel super profits to continue at our expense.
Why?
Oh, Dear Ryan. Here in NZ we have of past, had Business People "attempt" to set up alternative Supermarkets, but sadly at the time certain persons, involved in the then supermarket duopoly made it very clear that was NOT going to happen.
Now if has been a "problem" for NZ, why has the NZ Govt of day advised the Resource Management Council (this includes Local Councils) to revoke resource consents - made by then supermarkets - for the purpose of building "another" supermarket.
Even our Commerce Commission "could have" acted against duopolies from a business that could/would impact on a potential competitor - !
I will say this again, watch the Legal teams 'come out to play', from the current supermarkets - Foodstuffs to the fore - to contest any Govt actions that will allow competition in NZ against their established Nationwide business (New World, Pak & Save, 4 Square), which all are operated under Franchise.
Oh and from my observations, when shopping at a supermarket, the 'comments by all and sundry' does not seemed to have dampened trade - yup, I know the Managers of said shops are rubbing their hands.
They do "not" have happy thoughts for Nicola W, odd that.
Wooah. Hang on, Ryan. The theory about which Finance Minister Willis has zilch knowledge about, yet unbeknown to her is being implemented here, is called "contestable markets". It is associated William Baumol, who "held that there are markets served by a small number of firms that can still be competitive, because of the existence of potential short-term entrants". The assumptions that this theory is built on are not met in the case of the NZ supermarket duopoloy. Willis is marketing her greater freeing up of entry as a solution because her economic advisers at the NZ (Oligopoly) Initiative and Matt Burgess, who used to work there, are telling her to do so. The supermarket duopoly loves it, because it avoids their break-up, puts the blame not on them, but on too much government red-tape - and has suckered the likes of Ryan, who says, "She's got to the nub of the problem, which is basically red tape". The person who loves this theory most is the Chair of Foodstuffs who is a Director of the Initiative. Willis' announcement leaves him - and his industry -untouched. Its all only empty promises that things may change.
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