The ACT government has dumped its controversial supermarket competition policy, leaving local regulation of the sector to the Australian Competition and Consumer Commission.
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The government will abandon hand-picking supermarket operators for different locations, leaving the selection process to the ACCC and market forces.
Treasurer Andrew Barr denied the change of direction indicated the policy had failed, claiming it reflected only an increased confidence in the ACCC.
"[The] ACT government cannot solve all of the supermarket competition policy issues that are prevelant in Australia as a result of two very powerful national players," he said.
"Cosy duopolies are common in Australia across a variety of industries, that's what the ACCC is there to look after."
A spokesperson for Supabarn said that while the Canberra-based supermarket chain had originally supported the competition policy, it had been undermined by Coles and Woolworths.
The spokesperson said the government’s draft variation to restrict the maximum gross floor area for local centre supermarkets, if framed correctly, would be a more suitable way of ensuring the viability of local centres.
“[The draft variation] needs further refinement to deliver the ACT government’s policy on supporting local business and the ACCC’s commitment to reducing the market power of the major supermarket chains,” the spokesperson said.
Mr Barr said the government would maintain its right to sell sites directly to particular supermarket operators “should there be a compelling public interest in doing so”.
