By Sandra O'Malley
The federal government has quietly dumped its Grocery Choice price-monitoring website, announcing the decision late on Friday only days before the unpopular initiative was due to be relaunched.
The website faced plenty of criticism from its inception and last December independent consumer group Choice took over responsibility for the project, and its remaining $13 million budget.
Choice was shocked by the government decision, saying it was a bad day for consumers. It was only told of the decision after industry players and the media.
Consumer Affairs Minister Craig Emerson, who took on the job earlier this month, made the announcement in a statement after a meeting with major grocery retailers, saying it had become clear the aims of the website were not feasible.
Grocery Choice was one of the Rudd government's pre-election commitments, designed to appease consumers who felt they were being ripped off amid skyrocketing food prices.
"The government remains of the view that consumers are better placed to make informed choices when they are able to gain access to prices conveniently and make comparisons among supermarkets," Dr Emerson said.
"However, the Grocery Choice proposal as originally envisaged would not be able to generate reliable, timely data as a basis for consumers to make meaningful comparisons in their local neighbourhoods."
Dr Emerson could not be contacted for further comment despite repeated attempts by AAP.
Choice was due to relaunch the website on July 1.
"I am shocked and disappointed at the decision by the consumer minister to side with supermarkets rather than consumers," Choice chief Nick Stace said.
"Supermarket prices are higher in Australia than many other developed countries and Choice agreed to deliver Grocery Choice because we believed we could make a difference for consumers."
Mr Stace said the decision to pull the website suggested supermarkets were worried about losing their market power.
"Consumers (were to be) given up-to-date information on 1,000 products, rising to 5,000 within weeks," he said.
"To pull the site five days before launch shows that we were on the money and the supermarkets are worried about losing out to consumer demands."
The coalition, which has long derided the initiative as a waste of money, said taxpayers would bear the cost of the failed experiment.
Opposition consumer affairs spokesman Luke Hartsuyker criticised Prime Minister Kevin Rudd for telling voters Labor would be able to put downward pressure on grocery and fuel prices - yet Grocery Choice had now gone the way of FuelWatch, which was torpedoed in the parliament.
His Liberal colleague Steve Ciobo, spokesman on small business, told AAP it was good news for small retailers.
"This was always (an initiative) ... that gave the big grocers a massive advantage over the small independents," he said.
"Small independent retailers operate on a different pricing model ... and the way that this operated, those issues weren't being picked up.
Independent Nick Xenophon accused the government of giving up on reducing the massive market power of Coles and Woollies.
"By giving up on the scheme, the government is effectively giving up on making things fairer for consumers and smaller supermarkets," he said.
This week Senator Xenophon and Nationals Senate leader Barnaby Joyce introduced a private member's bill to end geographic price discrimination - where major chains cut prices at outlets around independents, but charge higher prices at other sites.
Major retailers applauded the government decision, saying commonsense had finally prevailed.
Australian Food and Grocery Council chief Kate Carnell said it was never going to be feasible to compare thousands of prices across thousands of supermarkets in a timely manner and with any degree of accuracy.
"Grocery Choice was only going to work if prices were displayed in real time, which is obviously unachievable," she said in a statement.
"The practice of constantly surveying food and grocery prices could have also undermined competition by impacting on local price flexibility."
Competition expert Frank Zumbo, from the University of NSW, said the website had never delivered any meaningful information to taxpayers.
"The federal government now needs to go back to the drawing board to deliver real action to rein in the ever increasing market power of the major supermarket chains that is costing consumers dearly through higher grocery prices," he said.
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