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Milk price needs further scrutiny says Labour

Spokesperson for Commerce

2 August 2011

Milk price needs further scrutiny

The decision by the Commerce Commission not to hold an inquiry into the price of milk will come as a blow to the many Kiwi families struggling to make ends meet, Labour’s Commerce spokesperson Lianne Dalziel, who also chairs the Commerce Committee, says.

Labour will now push for a select committee inquiry.

“The Consumers Institute has written to the committee on behalf of the thousands of New Zealand families who cannot understand why the price of milk is so high in the country that produces it. There is too much at stake for the price of what is a staple, everyday food product to escape scrutiny,” Lianne Dalziel said.

She was pleased that the Commerce Commission said it would consider allegations by independent processors that Fonterra had breached the Commerce Act by misusing its market power when it supplies raw milk to independents. However she had major concerns about it also saying that the existing regulation arrangements meant that intervention under Part 4 of the Commerce Act was not possible.

“These assumptions need to be tested and if that means that the Commerce Act is deficient then that needs to be exposed. The select committee is in a position to do that.”

"I believe there is wide interest in the range of issues that would have been canvassed in a Commerce Commission inquiry, including the definition in the Commerce Act of the threshold being ‘little or no competition’, but right now it is the public interest in the price of milk that deserves our attention,” Lianne Dalziel said.


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