NDP calling for probe of grocery store profits as food prices continue to rise
The federal NDP is calling for a parliamentary probe of the rising cost of food to determine whether major grocery store chains are raking in excess profits.
While Canada's inflation problem seems to be easing off, the cost of groceries has risen 10.8 per cent in the past year, according to Statistics Canada.
NDP agriculture critic Alistair MacGregor said he plans to table a motion before Wednesday's agriculture committee proposing that MPs investigate to find out whether grocery stores have been taking advantage of inflation.
"I think Canadians deserve answers and … in this time where they see the prices of everything going up, unfortunately they have a Liberal government which has not paid much attention to the role that corporate greed plays in the increasing prices they're seeing," MacGregor told CBC.
Two of Canada's three major grocery chains posted increased profits in their most recent financial reports. Loblaw reported a quarterly profit of $387 million — an increase of $12 million, or 3.2 per cent, over the same quarter last year.
Metro posted a $275 million quarterly profit, up from $252.4 million in the same quarter the year before. While Empire reported an increased profit in June, its latest financial statement showed a slight decline in profits over the most recent quarter — $187.5 million compared to $188.5 million the year previous.
Loblaw brands include Shoppers Drug Mart, Superstore and No Frills. Metro owns Food Basics, Jean Coutu, Metro and other brands, while Empire owns Sobeys and FreshCo.
While Loblaw and Metro have attributed their increased profits to a rise in pharmaceutical sales, MacGregor said it's still worth looking into.
"I know Canadians are trying to do everything they can to balance their budgets, but they also deserve to have parliamentarians look at this issue and find solutions," he said.
University of Toronto professor Partha Mohanram, an expert in financial statement analysis, said there is little evidence to suggest major grocers are using inflation as a pretext to boost their profits.
"It's incredibly difficult to actually make an allegation that these guys are actually profiteering, but there's no doubt they're doing pretty well," he said.
A recent report from Dalhousie University looked into the profits of Canada's major grocers over the past five years and found no evidence of profiteering off of the recent spike in inflation.
"If 'greedflation' exists, the available data suggests grocers are not responsible," the report reads.
"If people are accusing grocers of gouging and profiteering we don't know where they're getting their data," said Sylvain Charlebois, one of the report's authors.
But Charlebois, who is also director of the Agri-Food Analytics Lab at Dalhousie University, said a study into the rising cost of food is still worth doing, as long as it doesn't focus solely on grocery store profits.
The Retail Council of Canada, which represents the major grocers, said it doesn't oppose a committee study but — like Charlebois — argued that it should look at the effect external pressures — such as the war in Ukraine — are having on food prices.
"It would benefit any observer to look at the issue of rising food prices from the ground up, since there are so many global events and pressures at play," council spokesperson Michelle Wasylyshen said in an email.
A spokesperson for Conservative MP John Barlow, vice chair of the agriculture committee, told CBC News Barlow won't comment on the motion until he sees the text.
CBC reached out to Liberal members of the agriculture committee to ask if they would support the study but did not receive a response by the time of publication.
