Supermarket secrets – shopper docket documents reveal Woolworths’ heavy-handed tactics.
A Drink Tank exclusive has revealed the lengths Woolworths will go to when faced with measures that might curtail its alcohol promotion activities.
Following an extensive investigation into shopper docket alcohol promotions, the Office of Liquor, Gaming and Racing (OLGR) was in no doubt that the shopper docket activity in question was likely to encourage the misuse or abuse of liquor.
In a special report, Drink Tank asks, what part did industry pressure play in that decision?
See the index linking to all the documents in the investigation
Documents obtained by the Foundation for Alcohol Research and Education, and made public today for the first time, have shed light on OLGR’s investigation into shopper dockets which was sparked by a complaint from a member of the public on 1 March 2013.
Asked to ‘show cause’ why OLGR should not restrict or prohibit the activities of shopper dockets, Woolworth’s first response was to inform OLGR via its legal counsel that Woolworths was considering taking no action in response to the ‘show cause’ notice and believed it was “issued without thought” and “attacks the fundamental concept of discount liquor”.
On 3 April 2013, the Newcastle Herald published details of the OLGR investigation, again raising the ire of Woolworths, which takes its fight over the head of OLGR, by-passing the NSW Department of Trade and Investment, and going directly to the then Deputy Premier Andrew Stoner and the then Minister for Hospitality, Gaming and Racing, George Souris.
Requesting their direct intervention, Woolworths complained that “We consider it inappropriate that the issue of the show cause notice and the matter under review was disclosed to the Newcastle Herald’s [journalist] Ms Bramley.”
A letter from Woolworth’s lawyer on 29 May 2013, again challenges the OLGR investigation.
“It would be an extraordinary (and in our view unlawful) outcome if you were to purport to deny Woolworths packaged liquor outlets in NSW their right to compete on price in any material respect.”
Was Woolworths simply defending its turf?
Foundation for Alcohol Research and Education (FARE), Chief Executive Michael Thorn says no, and says the documents show Woolworths in a very unflattering light.
“There is a fine line between protecting your own commercial interests and corporate bullying, and my concern is that by choosing to adopt such a heavy handed, threatening and intimidating position, Woolworths has well and truly crossed that line,” Mr Thorn said.
On 4 June 2013, Woolworth’s lawyers request a meeting with Paul Newson in his capacity as Director of Compliance at OLGR stating, “Depending on your reply (to the attached letter) we may need additional time to respond, or I may receive instructions to approach the Federal Court because of potential Competition issues and Processes to date”.
Reacting to the continued criticism and pressure from Woolworths, an OLGR brief prepared for the Director General states “The correspondence from Woolworths alleging improper release of information appears to be an attempt to intimidate and disrupt OLGR’s regulatory intervention and interfere with the controlled release of regulatory information in the public interest”.
On 29 July 2013, OLGR concludes its review of the activity and submissions, and in a brief to the Director General states, “On review of the activity and submissions, there is sufficient evidence to support a preliminary view that the activity [shopper docket alcohol promotions] is likely to encourage the misuse and abuse of liquor as contemplated by section 102A of the Act”.
Department back down?
However, as the documents reveal, the Director General, Mark Paterson chooses to ignore and reverse OLGR’s decisive recommendation, advising “that he is not satisfied the case was made out that the activity was likely to encourage the misuse of or abuse of liquor.”
Mr Thorn says the Director General’s decision was disturbing and highly questionable, and says his decision to ignore the expert body’s advice adds further weight to calls for OLGR to be relocated outside of the Department of Trade and Investment.
“We have long argued that placing overall responsibility for liquor regulation in the hands of the Department of Trade and Investment is a recipe for disaster and now we have more proof. It creates a clear conflict of interest, and, again, has resulted in industry interests being placed above the public good.”
Mr Thorn says whether the industry’s influence of the NSW Department of Trade and Investment was undue or improper, should, in light of the documents now made public, be a matter for the Independent Commission Against Corruption (ICAC) to decide.
“The people of NSW deserve and demand that not only their politicians, but also their government bureaucracy is free of undue and improper industry influence. To that end, the Foundation for Alcohol Research and Education has written to the NSW Attorney-General calling on the NSW Government to refer the matter to ICAC for further investigation,” Mr Thorn said.