A former consumer watchdog boss will dig into the thorny issue of big business price gouging via a union-backed inquiry.
Esteemed economist and the former Australian Competition and Consumer Commission chair, Allan Fels, has been given the task of investigating the extent of price-gouging in the Australian economy.
The inquiry has been set up by the Australian Council of Trade Unions, which has been concerned excessive corporate profits are doing more to fuel sky-high inflation than rising wages.
Inflation started surging last year and has triggered a series of interest rate rises to bring it under control, with the higher borrowing costs and elevated cost of living putting Australian households under financial pressure.
ACTU secretary Sally McManus said working people were feeling the effects of higher prices.
“It’s only right we take a look to see what’s fuelling these rises and what can be done about it,” she said.
The role of corporate profits in the inflation outbreak has been debated, with Treasury and Reserve Bank analysis suggesting profits were not significantly driving up prices, with the exception of the mining sector.
Professor Fels said it was time to seriously investigate the matter.
“It’s time to take a serious look at what is a serious problem – does Australia have a price gouging problem, and if so, to what extent?”
He said price gouging had real consequences in a cost of living crisis.
“Those affected by this deserve an opportunity to express themselves alongside debate on potential policy solutions.”
The inquiry will hear from the public as well as academics, not-for-profit organisations, and think tanks.
The Australian Council of Social Service (ACOSS) welcomed the inquiry, with the high cost of essentials particularly taxing on low income households.
“We accept that inflation has put many businesses under pressure, but the burden of high inflation should be fairly shared – not shifted to lower paid workers and people on low fixed incomes relying on income support,” ACOSS chief executive Cassandra Goldie said.
(Australian Associated Press)