Explaining away the obvious not a good look for grocery CEOs

(Thumbing through the pages of grocery store flyers at the grocery flyers).. Sigh.

It is ugly out there. Stuff that are advertised as great sales now, are what they used to be regular priced. It’s not difficult to find videos on social media of people lamenting the astronomical and ridiculous prices of food.

So with inflation being an issue for Canadians with many people not making enough to make ends meet choosing between power, food or lodging… it is up to the government to try and step in and help right? The food chain goes from production of the crops, livestock etc. to processing and creation of the food products to aggregation and distribution and then markets and consumers.

While we all know about the ever-increasing federal environmental taxes and how it is hurting household incomes, the one which is currently receiving the most attention, is the federal government’s attempt to find out why grocery prices are so high. A parliamentary committee “investigating” high food prices are having the head of the largest food grocery chains to explain themselves to them and assembled media. Grandstanding potential at its finest. It’s not a sham, but this committee is allowing these companies to make generic statements, weakly defensive explanations but it seems doubtful anything will change because of it.

This parliamentary committee (from all three parties) heard Costco’s senior vice president and country manager for Canada Pierre Riel set to testify April 17. Metro, Empire Foods (Sobey), and of course Galen Weston and Loblaw have already testified and denied any wrongdoing.

Nope, they are definitely not gouging the public and using the talk of food inflation to pad their profits and bottom line. Nope. Their profit margin isn’t that much.

Grocery prices were up 11.4 per cent this January compared to January 2022. Overall inflation is 5.9 per cent. If you were wondering if the higher pricing has made that much of a difference, check these numbers out. According to Canada's National Observer, “Loblaws’ net earnings went from just over $1 billion in 2019 to $2.2 billion in 2022, and Empire Co.’s net earnings went from $387 million in 2019 to $746 million in 2022.”

Yup sounds like those profit margins are weak.

Not wearing a tacky sweater like he has in those terrible commercials which have not surprisingly disappeared from television airwaves, Weston said it was “impossible” for grocers to be making that high of profits.

“(It’s) a very difficult challenge,” he told the media after his March 8 testimony. “Hopefully our opportunity to speak and answer questions today has been helpful not just in terms of satisfying the committee but also through media exposure, to help rebuild public trust.”

After a vomit—inducing statement like that, you know that these food CEOs don’t care.

Now with the federal budget, the Liberals unveiled a grocery rebate targeting 11 million Canadians.

The federal Liberals are now boasting of a up to $467 rebate (family of four), $234 (single people) and $225 for seniors. It will sent out through the GST/HST rebate system (i.e. anyone single making over $49,000; over $50,000 for a couple or over $60,000 for a family of four) and so those pay periods are April 5, July 5 and Oct. 5.

The average family of four will spend up to $16,288.41 on food this year, according to the latest Canada’s Food Price Report. I don’t those rebates will help consumers but it “helps” the Liberals to say we have addressed the issue, in a controlled way.

What would help is for the parliamentary committee to have some teeth and force the companies to lower prices. Simple. This won’t happen because they have to let their corporate friends and if one had time to dig, corporate party donors, do what they want.

It’s like cleaning up the mess your younger sibling left in the house just so no one else gets angry.

Personally, I think the food CEOs should have to complete a worthy and legitimate exercise. They are given $200. The goal of the exercise is they have to buy what is on their grocery lists (a quote average grocery list for a family of four) with no help from anyone. They need to stick to that budget while they try to fill their shopping carts while doing it in their respective stores. If they fail, they get massive fines and that money is redistributed to low income households. Fair is fair right? Inflation is truly a horrible thing for those whose income has stayed constant or decreased over a long period of time, not that these CEOs would understand or care.