Greens want to fine supermarkets up to $10 million for charging too much

The Green Party wants the government to support a new law that would stop supermarkets from charging prices that are too high, with fines of up to $10 million.

The bill was written by Green MP Ricardo Menéndez March. It would ban supermarkets from charging prices that are "excessive" compared with what it costs them to supply a product plus a "fair margin" (RNZ).

Under the bill, the Commerce Commission — the government agency that watches over competition in New Zealand — would ask a court to decide whether a supermarket had broken the rules. Supermarkets would have to keep records of their prices and give them to the Commission if asked. Fines would be up to $10 million, three times the profit a supermarket made from overcharging, or 10 percent of its total income.

Menéndez March said the idea copies a law Australia brought in on 1 July, with the same penalties.

Green co-leader Chlöe Swarbrick said New Zealanders pay too much for groceries and that supermarkets make more than $1 million a day in profit. She called on the prime minister and the coalition to use Parliament's remaining time to lower the cost of living.

The bill is part of the Greens' affordable kai policy, which will be announced next month. It comes as the government has tried and failed to bring a new international supermarket into the New Zealand market, and as New Zealand First has promised to break up the two big supermarket companies if elected.

The Greens have previously called for the government to urgently tax excess supermarket profit and give the money to households (Green Party). Party material has cited food prices rising 4.5 percent over the past year while supermarkets made $1 million a day in excess profits (Green Party). The party has also put forward a separate bill that would require the biggest supermarkets to partner with food rescue organisations (Green Party).

Swarbrick has been speaking out more strongly on the issue for months. On 19 May she posted on Instagram that New Zealanders cannot afford their groceries and called MPs who ridiculed bills "cowards" (Instagram). A week later she described supermarkets as making "demonstrable, proven excess profit" and called the situation a "greed crisis" (Instagram). More recently, Swarbrick was told to leave Parliament after challenging what she called the Speaker's "double standards" (RNZ via Facebook).

The broader context here is that bills like this one, put forward by individual MPs rather than the government, only become law if parties across Parliament agree to support them. Parliament has limited sitting days left before the election, so the chances of this bill being picked up, debated, and passed are slim. The Greens' strategy seems to be as much about forcing a vote that puts the coalition on the record about supermarket prices as it is about the bill actually becoming law.

Australia's new ban gives the Greens a direct comparison. Any New Zealand government that chose not to do the same would have to explain why. Whether that argument works with the coalition, or whether the bill stays a political tool ahead of the election, will depend on whether there is any appetite for directly regulating prices in a market where bigger fixes have not yet happened.