Industry Minister François-Philippe Champagne announced a number of measures to help alleviate high food prices and told Canadians to monitor grocery flyers to see their impact.
“I invite you to look at the flyers that are starting to come out today from different grocers and you’ll see different offers,” said the minister after being asked by reporters when he expects prices to stabilize.
Mr. Champagne spoke at a press conference on Oct. 5 with Deputy Prime Minister and Finance Minister Chrystia Freeland, Housing Minister Sean Fraser, and Treasury Board President Anita Anand. The ministers each announced various programs or plans to address affordability issues or government spending.
The minister defended that the governmental measures, such as the creation of focused teams, are brand new and would help to bring down prices.
“It’s a set of measures that together will help stabilize price,” he said. “The actions of the grocers is one piece of that, but there’s many more things that will help us to stabilize prices and offer this value for consumers.”
Mr. Champagne, who met with the CEOs of top grocers in mid-September, said Canadians will soon see the rollout of actions stemming from that meeting. He said those include discounts across a basket of food products, price freezes, and price matching campaigns.
Grocers have submitted different plans, said the minister, “so it will be up to Canadians to judge them, to benefit from the best offer.”
Mr. Champagne also announced he would strengthen the Office of Consumer Affairs to have a dedicated team to monitor the retail sector and investigate issues like “shrinkflation” and “dequaliflation”—food industry practices to maintain prices by reducing content or quality.
“With more transparency in prices, the smaller players will be better equipped to negotiate,” said Mr. Champagne.
The minister said his government is open to do more and to hold the grocers’ “feet to the fire.” The Liberal government has threatened the grocers with fiscal measures if they don’t address food prices, a measure some critics say would not help to lower prices.
“We’re not there yet today,” Mr. Champagne said about imposing a tax, but he said it’s not off the table.
Ms. Freeland said that her presence at the meeting with the grocers was to send them a message that all tools at the government’s disposal could be used against them, including under her fiscal remit.
“That was a physical demonstration of the reality that there is teamwork on this front, there is a whole of government approach and no tools are off the table, no measures are off the table,” she said. “And that very much includes finance measures, like tax measures.”
The Retail Council of Canada, which speaks for grocers on the issue, says that food inflation in Canada has been less than in other developed countries and that it’s starting to see some abatement in some of the input costs impacting prices in the past months.
Spokeswoman Michelle Wasylyshen says that good faith discussions have taken place with the government in recent days, but remarked that grocers are “unique entities, with different business models and distinct approaches.”
Ms. Wasylyshen added that food distributors are “heavily dependent” on what manufacturers charge for their products.
Criticism
Economists testifying earlier that day in the House of Commons finance committee said the Liberal government won’t be able to reign in inflation with the measures it’s implementing.Vivek Dehejia, an economics professor at Carleton University, said inflation can’t be fixed without recognizing that “loose monetary policy, let loose after the financial crisis and the pandemic” are the “real culprit.”
“And wage and price controls or tinkering with competition law, it won’t fix that problem,” he said, specifying that wage or price controls don’t fix inflation and only cause scarcity.
Bill C-56 was introduced on Sept. 21 and also seeks to remove the GST on new rental builds to increase the housing supply.
