NDP Leader Calls for ‘Severe Penalties’ for Price-Fixing Following Loblaw Settlement

NDP Leader Jagmeet Singh arrive on Parliament Hill in Ottawa on June 19, 2024. (The Canadian Press/Sean Kilpatrick)

NDP Leader Jagmeet Singh has called for “severe penalties” for corporations that engage in price-fixing following news that Loblaw Companies Limited and its parent company, George Weston Limited, have agreed to pay $500 million in penalties for their role in a bread price-fixing scheme.

“The rules should be there to protect Canadians, but the rules written by the Liberals and Conservatives by Justin Trudeau and Pierre Poilievre, have allowed big corporations to rip you off,” Mr. Singh said during a July 25 press conference.

“There are no real penalties. We want to change that. We want severe sanctions, severe penalties.”

Loblaw Companies Ltd. and George Weston Ltd. announced in a statement on the same day that they have agreed to pay out $500 million to settle a class-action lawsuit against them for their involvement in an “industry-wide” arrangement to fix the price of bread. It’s estimated that Canada’s largest grocery retailers and bread makers overcharged consumers by $5 billion over 16 years.

Citing the settlement by the two companies, Mr. Singh said penalties for corporations engaging in price fixing should be tripled, indicating “$15 billion of fines would really deter these companies from ripping you off. That’s what we’re talking about.”

The NDP leader also proposed a price cap on essential food, saying grocers are making “record profits” while Canadians struggle to afford food.

Mr. Singh has been critical of grocery store CEOs in recent years, saying they have driven up food prices while Canadians have faced hardship to afford groceries.

The heads of Canada’s biggest grocery chains have pushed back on these allegations, saying their profit margins are very low.

“As unexpected as it may sound, grocery chains operate with extremely small profit margins, which means we have minimal influence on inflation,” Loblaws’s Mr. Weston told parliamentarian at a committee meeting last year.

Back in September 2023, Mr. Singh introduced a private member’s bill to increase penalties for price fixing and give the Competition Bureau more powers to protect smaller grocery stores.

“I’m putting forward changes today that would ensure Canadians aren’t getting ripped off at the grocery store and to bring food prices down for you and your family,” Mr. Singh said at the time.

In May 2024, Mr. Singh also called for the competition commissioner to investigate allegations that the Loblaw grocery chain and a company owned by telecom companies Rogers and Bell have been engaging in price fixing.

He was responding to a May 9 letter from Québecor telecom CEO Pierre Karl Péladeau to Industry Minister François-Philippe Champagne informing him that Loblaw had decided to “prematurely terminate” a contract between its in-store kiosks, called The Mobile Shop, and Québecor’s Freedom Mobile subsidiary.

Mr. Péladeau said Loblaw is instead partnering with Glentel, owned by Rogers and Bell. “It is imperative that action be taken to preserve a fair competitive environment in the telecommunications and grocery businesses, in the best interests of Canadians,” he said.

The Liberal government had amended the Competition Act in December 2023 to strengthen the Competition Bureau’s ability to promote competition and prevent anti-competitive mergers and conduct.

Back in September 2023, the Liberal government also threatened to tax grocery chains if they fail to reduce grocery prices.