Independent Review of the Food and Grocery Code of Conduct's Interim Report delivered its "Firm Recommendations" on 8 April 2024

There are 21 days left to have your say on this discussion paper. Submissions close 30 April 2024.

Go to https://treasury.gov.au/consultation/c2024-510813 for details.

Submissions to the Interim Report will assist Dr Emerson in preparing a Final Report, which will be provided to the Government by 30 June 2024

IndependentReview of the Food and Grocery Code of Conduct – Interim Report, 5 April 2024, excerpts:

PAGE 1

A heavy imbalance in market power between suppliers and supermarkets in Australia’s heavily concentrated supermarket industry necessitates an enforceable code of conduct. An effective code of conduct would benefit smaller suppliers and consumers by enabling suppliers to innovate and invest in modern equipment to provide better products at lower cost.

The existing Food and Grocery Code of Conduct (the Code) is not effective. It contains no penalties for breaches and supermarkets can opt out of important provisions by overriding them in their grocery supply agreements.......

PAGES 2-3

The Review has held more than 40 meetings, as well as receiving 56 submissions in response to the Consultation Paper that was released on 5 February 2024. In addition, 2 roundtables were co-convened by the Review with the Minister for Agriculture, Fisheries and Forestry, Senator the Hon Murray Watt, involving members of the National Famers’ Federation, various primary producer representative groups, meat and other agricultural processors, and the trade union movement.

The terms of reference for the Review ask whether the Food and Grocery Code (the Code) should be retained as a voluntary code, made mandatory or scrapped altogether. The Review has found that the heavy imbalance in market power between the major supermarkets and their smaller suppliers necessitates the continuation of a Food and Grocery Code of Conduct in some form. The Code should not be scrapped.

A mandatory Code that is the best of both worlds

The Review’s central, firm recommendation is that the voluntary Code be made mandatory and subject to enforcement by the ACCC. The mandatory Code should apply to all large supermarkets that meet an annual revenue threshold of $5 billion (indexed for inflation). Revenue would be in respect of carrying on business as a grocery ‘retailer’ or ‘wholesaler’ (as defined in the voluntary Code). At this stage this would capture Coles, Woolworths, ALDI and Metcash. All suppliers to these businesses would be covered by the Code.....

PAGE 7

Firm recommendations

Firm recommendations of the Interim Report are as follows and will not change. [my yellow highlighting]

• Recommendation 1: The Food and Grocery Code of Conduct should be made mandatory.

• Recommendation 2: All supermarkets that meet an annual revenue threshold of $5 billion (indexed for inflation) should be subject to the mandatory Code. Revenue should be in respect of carrying on business as a ‘retailer’ or ‘wholesaler’ (as defined in the voluntary Code). All suppliers should be automatically covered.

• Recommendation 3: The Code should place greater emphasis on addressing the fear of retribution. This can be achieved by including protection against retribution in the purpose of the Code and by prohibiting any conduct that constitutes retribution against a supplier.

• Recommendation 4: As part of their obligation to act in good faith, supermarkets covered by the mandatory Code should ensure that any incentive schemes and payments that apply to their buying teams and category managers are consistent with the purpose of the Code.

• Recommendation 5: To guard against any possible retribution, supermarkets covered by the mandatory Code should have systems in place for senior managers to monitor the commercial decisions made by their buying teams and category managers in respect of a supplier who has pursued a complaint through mediation or arbitration.

• Recommendation 6: A complaints mechanism should be established to enable suppliers and any other market participants to raise issues directly and confidentially with the ACCC.

• Recommendation 8: A Code Supervisor (previously the Code Reviewer) should produce annual reports on disputes and on the results of the confidential supplier surveys.

• Recommendation 10: Penalties for non-compliance should apply, with penalties for more harmful breaches of the Code being the greatest of $10 million, 10 per cent of turnover, or 3 times the benefit gained from the contravening conduct. Penalties for more minor breaches would be 600 penalty units ($187,800 at present)....

PAGES 70-71

Facilitating stronger competition in grocery retailing

Greater competition in grocery retailing and wholesaling would not only improve the negotiating position of smaller suppliers, but it would also deliver better prices to consumers. From the perspective of consumers and the economy at large, competition is good, but more competition is even better.

To address wider recommendations is very important for [the] wider advance in policy reform since the current Government is appropriately establishing many reviews and inquiries in many individual areas. But it lacks a proper mechanism devoted to adding up and integrating the results. [Professor Withers and Professor McEwin (Australian National University), Submission to the Consultation Paper, 23 February 2024, p1]

A reformed Food and Grocery Code is one of several cost-of-living and pro-competition inquiries and measures being undertaken at present. Other inquiries and initiatives are outlined briefly below.

ACCC Supermarket Inquiry 2024-25

On 1 February 2024, the Treasurer, the Hon Dr Jim Chalmers MP, directed the ACCC to undertake a 12-month price inquiry into the supermarket sector to ensure Australians are paying a fair price for their everyday groceries.

The inquiry will examine the competitiveness of retail prices for everyday groceries. Matters to be considered by the inquiry include, but are not limited to:

• The structure of the supermarket industry at the supply, wholesale and retail levels;

• Competition in the industry and how it has changed since 2008, including the growth of online

shopping;

• The competitiveness of small and independent retailers, including in regional and remote

areas;

• The pricing practices of supermarkets;

• Factors influencing prices along the supply chain, including the difference between farmgate

and supermarket prices;

• Any impediments to competitive pricing along the supply chain; and

• Other factors impacting competition, including loyalty programs and third-party discounts.

An issues paper has been published seeking views on the key issues the ACCC will consider in the inquiry. An Interim Report will be provided to the Government by 31 August 2024, with the Final Report due to be provided by 28 February 2025.....

The full 83 page interim report can be read and downloaded at:

https://treasury.gov.au/sites/default/files/2024-04/c2024-510813-ir.pdf

Final Report of the Aged Care Taskforce March 2024: "A strong preference for many older people and their families is for them to age in place and remain in their home for as long as they are able. This was reflected in responses to the stakeholder survey, with 90% of respondents supporting the principle."

 

Given the growing number of people over the age of 65 years living in the Northern Rivers region, this may be of some interest to retirees, their families and friends.

Australian Government, Final report of the Aged Care Taskforce, 12 March 2024, excerpt:

Support older people to age in place

______________________________________

Principle 1: The aged care system should support older people to live at home for as long as they wish and can do so safely.

______________________________________

A strong preference for many older people and their families is for them to age in place and remain in their home for as long as they are able. This was reflected in responses to the stakeholder survey, with 90% of respondents supporting the principle.

The decision of whether an older person wishes to remain at home or enter residential aged care is driven by a wide range of factors. Consultation showed the top reasons for preferring to remain at home included comfort and privacy, a desire to remain independent, better mental and physical health outcomes and maintaining connection to community, friends and family. For other reasons, such as social connectedness, increasing clinical care and safety needs, some older people may choose to enter residential aged care sooner. While overall there is a shift towards ageing in place, it is important to meet each person’s preferences for their aged care and provide continuity of care when needs change.

Home care programs need an overhaul to meet future demand

The current home care programs are not ready to meet the needs of a rapidly growing cohort of older people. Home care currently involves 2 programs, the Home Care Packages Program and the Commonwealth Home Support Programme, that have evolved over time and with different design objectives. This has led to a system where:

• applicant assessments are inconsistent and not well aligned to actual need

• access to services is constrained and inconsistent, and many older people are not receiving an optimal mix of services 

• services are priced and fees are charged inconsistently (see Appendix E for details)

• different funding approaches are impeding the sector from scaling up and diversifying

• there is a lack of clarity about what services should be available.

Those who can access home care under the current system can leave significant funds unspent, while others can wait for months to access services. This is due to existing program constraints, limited availability of services and appropriately skilled workers, as well as behavioural and attitudinal factors. In the Home Care Packages Program, unspent funds as at 30 June 2022 totalled $2.3 billion.16 Prices across the programs are inconsistent and inefficient due to variable price setting arrangements. This undermines the predictability and sustainability of funding and can cause confusion when comparing packages with other participants.

There are also obvious signs of lack of scale and diversification of providers. As the population ages, these issues will need to be addressed to deliver a rapid scaling up of services to meet demand.

The Support at Home Program is an opportunity for generational change in how home care is delivered

It will also be important to make sure home care better meets older people’s needs, while enabling program

scalability and pricing signals that ensure funds are used consistently and in line with program intent. In

addition, home care must provide value for money, transparency and better quality services.

The new Support at Home Program, to be introduced in stages from July 2025, is an opportunity to address

these critical issues in the current home care programs.

As the Support at Home Program is implemented, it will be important to ensure the new arrangements

deliver on the intent of the design and meet the expectations of older people, their families and carers for:

• greater choice and control

• easier and more timely access

• flexibility to adjust services over time as needs change

• better value for money through controls on unreasonable administration fees

• better clarity and transparency around fees and how funding is used.

It is also important that the new arrangements deliver for providers, acknowledging the need for:

• more predictable and sustainable funding that meets the costs of quality service delivery

• recognition of the costs associated with complying with regulatory requirements

• flexibility to adjust services on the ground as participant needs change

• improved use of a qualified and skilled workforce to increase service availability

• appropriate and adequate implementation timeframes.

Support at Home Program inclusions and exclusions need to be more clearly defined than under current programs

The Taskforce was asked to provide advice on program inclusions and participant contributions for the

Support at Home Program. In developing this advice, the Taskforce considered the diverse needs, goals and

circumstances of participants, the intent of the program and the role of other service systems. The

importance of prevention, flexibility and reablement also played a key role in discussions.

The Taskforce notes the Support at Home Program needs much clearer specifications than current programs about what it will and will not fund. The lack of clarity and consistency in inclusions and exclusions in current home care programs has led to confusion between providers and participants. This affects participants’ ability to make informed choices about their care, diminishes value for money in the programs, and could also mean that funds are not used according to the policy intent of home care.

Read and download the full report at:

https://www.health.gov.au/sites/default/files/2024-03/final-report-of-the-aged-care-taskforce_0.pdf

With Aging in Place recommendations on pages 16 to 18.

A simple explanation of the 'right to disconnect' - that is the right to separate your work life from your home & family life

All employees in the national workplace relations system are covered by the National Employment Standards (NES).

This is regardless of the award, registered agreement or employment contract that applies. 

Details can be found at:

https://www.fairwork.gov.au/employment-conditions/national-employment-standards

Considering that Opposition Leader & LNP MP for Dickson Peter Dutton has vowed to repeal the Albanese government’s newly passed tranche of workplace reforms, including the right to disconnect, if the Coalition was to be re-elected to office next year — here is a simple explanation of how, under the law, workers now have the legal right to ignore phone calls and emails made by their employers out of working hours or demands to work unscheduled unpaid hours if the employer's request can be considered unreasonable. In other words, workers have the right to disconnect their home and family life from their work life.

 

https://www.youtube.com/watch?v=zvKfaKR2UAs

Cartoons of the Week

Alan Moir

Mark David

David Rowe

Cathy Wilcox

Matt Golding

It appears that Peter Dutton's drive to label Labor's proposed amended Stage 3 Tax Cuts as "a betrayal" and his accusation that the PM was "lying to the public" have fallen on predominately deaf ears across the national electorate

The Australian's Newspoll of 4 February 2024 was published Monday 5 February.

This was the first Newspoll of 2024 after a seven week gap since previous polling in December 2023.

The published results are based on a survey of 1,245 voters who were surveyed between Wednesday, 31 January and Saturday, 3 February 2024.

PRIMARY VOTE

Labor (sitting federal government) — 34 (up 1)

Coalition (L-NP opposition) — 36 (no change)

The Greens — 12 (down 1)

One Nation — 7 (no change)

TWO PARTY PREFERRED

Labor — 52 (no change)

Coalition — 48 (no change)

PREFFERED PRIME MINISTER

Anthony Albanese (current incumbent) — 46 (no change)

Peter Dutton (current opposition leader) — 35 (no change)

Uncommitted — 19 (no change)

APPROVAL RATING

Albanese:

Approve 42 (no change)

Disapprove 51 (up 1)

Dutton:

Approve 37 (down 2)

Disapprove 50 (up 2)

PROPOSAL TO AMEND STAGE 3 TAX CUTS

IMAGE: via @GrogsGamut Click on image to enlarge

According to The Australian's Page One on 5 February, "Mr Albanese has said the tax cuts were aimed at Middle Australia. This was supported by the poll results, which showed that 43 per cent of 35- to 49-year-olds said they would be better off and 44 per cent of 50- to 64-year-olds agreeing they would benefit....

The Newspoll showed female voters were significantly more likely to support the tax cuts than men: 65-59 per cent.

Those aged between 50 and 64 were also the most supportive of the change"

The Australian Parliament resumed on Tuesday 5 January, with the government planning to introduce legislation to replace the stage three tax cuts with a new tax rate table

Hopefully the government's amendments will pass unopposed and unamended by the Liberal-Nationals Coalition.

If for no other reason than Morrison's Treasury Laws Amendment in 2019 will no longer survive to fulfil its unofficial alternative title and descriptions: “Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money But Not For A Really Long Time) Bill 2019” aka "a tax package that is both fiscally irresponsible and unfair", "unfair and unjust", "a con job" making "inequality worse".

Sources:

Australian Parliament, Hansard, June 2018 to July 2019

9 News, 25.01.24

The Daily Telegraph, 26.01.24

AAP General Newswire, 04.02.24

The Australian, 05.02.24

Ghost Who Votes (@GhostWhoVotes), 05.02.24

Grog's Gamut (@GrogsGamut), 05.02.24

Live and work in the NSW Northern River Region? Want to know how much less tax you will pay under the Albanese Government 's changes to former Morrison Government Stage 3 tax cuts?

The Australian Government Treasury has kindly created a an online Tax Cut Calculator which those who pay personal income tax on their wages or salaries can use to calculate how much less in tax liabilities they will have in 2024-25. 

Calculation are based on an individual's annual taxable income and, starts showing varying degrees of tax relief at taxable incomes of $21,887 per annum all the way up to taxable incomes of $1,000,000 per annum.

It will also supply a comparison with this financial year's estimated annual tax liability and an individual's estimated annual tax liability in 2024-25 if the proposed amendments are passed by the House of Representatives this month.

Go to: https://treasury.gov.au/tax-cuts/calculator 

Why did the Albanese Labor Government make the decision to amend the former Morrison Coalition Government tax cuts due to come into effect on 1 July 2024?  

Treasury Advice on Stage 3 Tax Cuts

Overview

  The upcoming Stage 3 tax cuts were designed and legislated when dramatically different circumstances were expected to unfold. Since they were legislated, the global economy has been impacted by several significant, unanticipated shocks. The COVID-19 pandemic disrupted supply chains and saw the rollout of unprecedented government support. More recently, ongoing global conflicts have led to rapid increases in energy and food prices, which are rippling through domestic prices and have contributed to inflation reaching 30-year highs. 

  Low- and middle-income households have been under significant pressure from unanticipated cost-of-living increases associated with the lift in prices. It is challenging to provide support to these households without unduly adding to inflationary pressures and perpetuating cost-of-living challenges. 

  Treasury expects inflation to return to the target band over the coming 18 months and built into this profile are the Stage 3 tax cuts. One way to provide further relief to those households most affected by cost-of-living increases and not impact inflation is to redesign the Stage 3 tax cuts. 

  It remains important to deliver an overall tax cut around the size of the Stage 3 tax cuts to unwind bracket creep and lower average income tax rates. This case is supported by the ongoing improvement in the budget position and adverse impacts of rising average income tax rates. 

  A redesign of the Stage 3 tax cuts presents other opportunities, including enhancing the participation benefits of the tax cuts, especially for women, and distributing the future impact of bracket creep more evenly. This can be achieved with the same budgetary cost as the Stage 3 tax cuts. 

  The redesign of the Stage 3 tax cuts outlined in this document is estimated to provide cost-of-living relief to 13.6 million taxpayers. This option is broadly revenue neutral, will not add to inflationary pressures and will support labour supply......

Read the full advice at:

https://treasury.gov.au/sites/default/files/2024-01/tax-cuts-treasury-advice.pdf 

IMAGE: Australian Treasury

By way of example.....

Using the 2021 Census &.id informed decisions data as guidelines for Northern Rivers Region stated annual individual incomes and relying on figures produced by Treasury's tax calculator:

in the 2024-25 financial year an est. 8.7% of all Northern Rivers local workers should see an annual tax cut somewhere between $234-$513;

with roughly 23% of local workers expected to find their annual tax liability reduced by between $468-$700;

around 14.5% can expect to have their tax liability drop by somewhere between $700-$978;

another 14.5% of local workers have annual incomes which should see their tax cut come in between $978-$1,303;

an est. 9.5% of local workers are calculated to receive a tax cut of between $1,304-$1,629;

while 7.7% of all local workers are estimated to fall within the range of between $2,279-$ 3,729 less in annual tax liability; and

est. 3.7% of all workers may see their annual tax liability cut by between $3,729-$3,889 or higher.  

Note: this is not an exhaustive list of Northern Rivers local workers' expected tax cuts in 2024-05 should the House of Representatives pass the Albanese Government proposed amendments to the former Morrison Government Stage 3 tax cuts.

BACKGROUND

Northern Rivers Regional Area

IMAGE: .id informed decisions

At the 2021 Census est. 116, 851 people were working part-time or full-time for a wage or salary in the seven local government areas within the NSW Northern Rivers region. [.id informed decisions, Northern Rivers Region economic profile]

In 2021 the taxable gross income of these workers ranged from est. $351 up to $3,500 and over per week.

Overall, 15.4% of the local workers earned a high income, and 16.0% earned a low income, compared with 24.6% and 11.5% respectively for NSW.

The major differences between the weekly income of the local workers in the Northern Rivers Region and NSW were:

• A smaller percentage of local workers who earned $2,000 - $2,999 (7.7% compared to 13.3%)

• A smaller percentage of local workers who earned $3,500 or more (2.4% compared to 6.2%)

• A larger percentage of local workers who earned $800 - $999 (14.5% compared to 10.9%)

• A larger percentage of local workers who earned $650 - $799 (11.5% compared to 8.1%) [.id informed decisions, Northern Rivers Region economic profile]

A brief look at changes to Australia's personal income taxation scheme from Morrison to Albanese

 

Then Treasurer, Scott Morrison, announced the Government’s Personal Income Tax Plan (PITP) in the 2018–19 Budget. The PITP reduced personal income taxes over the next seven years through a combination of changes to tax offsets for low and middle income earners and changes in income tax thresholds. The changes were to be implemented over three steps, commencing in 2018–19, 2022–23 and 2024–25. The 2018–19 changes were targeted at low and medium income earners, with the changes in 2022–23 and 2024–25 applying to individuals on higher taxable incomes. [Australian Parliamentary Library, Budget Review 2018–19 Index]

In 2018 the Treasurer placed a tentative costing on his seven-year tax scheme change of $140 billion.

In 2019 the Morrison Government began Stage 1 of what it characterised as a 'flattened' personal income tax scheme which abandoned in large measure Australia's progressive tax scales.

At the time it was expected to cost $18 billion in 2019-20. It mainly comprised a Low and Middle Income Tax Offset (LMITO) worth up to $1,080 a year for taxpayers on $30,000 to $126,000. High income-earners (the top 20% of taxpayers on $90,000 or more) have already gained up to $135 p.a. from an increase in the upper threshold of the 32.5% tax rate to $90,000 in 2018. Overall, Stage 1 mainly went to middle income-earners on $30,000 to $90,000.

Stage 2 began in July 2022. It was projected to cost $16.4 billion in 2023. Stage 2 saw the end of LMITO on 30 June 2022 under the cessation schedule revised by the former Morrison Government. This was the end of targeted offset tax relief for those earning between $66,668 – $126,000.

The scaled Low Income Tax Offset (LITO) is still available for those earning between $37,500 or less and $66,667.

The Australian resident tax rate for 2020-21 to 2023–24.

Australian Taxation Office Table, retrieved 25 January 2024.

There were no changes to any resident personal income tax rates or threshold in the four financial years up to 2023-24.

Stage 3 of the tax scheme commences in July 2024 and as originally legislated, would have seen the 32.5% marginal tax rate will cut to 30% for one big tax bracket between $45,000 and $200,000. This was intended to closely align the middle tax bracket of the personal income tax system with corporate tax rates. While the 37% tax bracket was be entirely abolished at that time. It heavy favoured high income earners. By November 2023 it been found that this last round of tax cuts were estimated to cost around $69 billion over the forward estimates period (to 2026-27). This estimate was higher than previously provided and reflects an additional year in the forecast period, along with updates to economic parameters.

Stage 3 was amended by the Albanese Labor Government in January 2024 to reduce the largess awarded high income earners and lessen the impact of the sustained cost of living pressures.

On Thursday 25 January 2025 in a joint press release by the Prime Minister, Treasurer and Minister for Finance it was announced:

From 1 July 2024, the Albanese Labor Government will:

• Reduce the 19 per cent tax rate to 16 per cent (for incomes between $18,200 and $45,000).

• Reduce the 32.5 per cent tax rate to 30 per cent (for incomes between $45,000 and the new $135,000 threshold).

• Increase the threshold at which the 37 per cent tax rate applies from $120,000 to $135,000.

• Increase the threshold at which the 45 per cent tax rate applies from $180,000 to $190,000.

As a result of these changes, on July 1:

• All 13.6 million taxpayers will receive a tax cut – and 2.9 million more taxpayers will receive a tax cut compared to Morrison’s plan.

• 11.5 million taxpayers (84 per cent of taxpayers) will now receive a bigger tax cut compared to Morrison’s plan.

• 5.8 million women (90 per cent of women taxpayers) will now receive a bigger tax cut compared to Morrison’s plan.

• A person on an average income of around $73,000 will get a tax cut of $1,504 – that’s $804 more than they were going to receive under Morrison’s plan.

• A person earning $40,000 will get a tax cut of $654 – compared to nothing under Morrison’s plan.

• A person earning $100,000 will get a tax cut of $2,179 – $804 more than they would receive under Morrison’s plan.

• A person earning $200,000 will still get a tax cut, which will be $4,529. [reduced from est. $9,075] 

In addition, the Government will increase the Medicare levy low-income thresholds for 2023-24.

See full press release at:

https://www.pm.gov.au/media/tax-cuts-help-australians-cost-living

UPDATE 1 February 2024

SEE: https://treasury.gov.au/tax-cuts

MAIN SOURCES

The Guardian, Scott Morrison seeks backing for budget tax cuts without full costings, May 2018

ACOSS briefing notes, The Government’s tax cuts:

Who gains? What do they cost?, June 2019

H&R Block 2023 Federal Budget Tax Updates, undated

Australian Tax Office, Tax rates – Australian resident, September 2023 and Individual income tax rates and threshold changes, January 2024

Treasury Question Time Brief, Personal Income Tax - Stage 3, November 2023

Australian Parliamentary Library, Budget Review 2018–19 Index, Personal income tax cuts and the Medicare levy

National Press Club Address by Prime Minister Anthony Albanese, January 2024 

The Treasury, Tax cuts to help with the cost of living, January 2024

 

Department of Prime Minister and Cabinet

Monday 1 January 2024 | Media release

Transfer of 2003 Cabinet records to the National Archives of Australia

In 2020 the Department of the Prime Minister and Cabinet (the Department) transferred 2003 Cabinet records, including those prepared for the National Security Committee of Cabinet, to the National Archives of Australia (the Archives).

This is the normal process and allows time for appropriate consultation with relevant agencies to ensure content released is compliant with exemptions in the Archives Act 1983.

The 2020 transfer of a small number of additional 2003 Cabinet records did not take place as it should have due to apparent administrative oversights by the Department, the Archives and security agencies. These oversights were likely as a result of COVID-19 disruptions at the time.

The additional records were located by the Department on 19 December 2023, and the Department and the Archives jointly inspected the records on 22 December 2023. These additional records have now been transferred to the Archives.

The Archives will review the additional records in consultation with relevant agencies, including security agencies, to ensure content released is compliant with exemptions in the Archives Act 1983.

The Secretary of the Department has appointed Mr Dennis Richardson to undertake an independent review of the 2020 transfer process and confirm that all relevant records have been transferred to the Archives. Mr Richardson will complete his review by the end of January 2024.

Only the Archives decides which documents are released and to whom. Neither the Department, nor any Minister, has any role in this decision. [my yellow highlighting]

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

How the newspapers saw the situation on 1 January 2024......

The Guardian