Tuesday 6 October 2026
Afternoon EditionRSS
ZOTPAPER

News without the noise

ZOTPAPER
Business

Government-owned supermarket chain proposed at $25.1 billion to take on Coles and Woolworths

Plan for a publicly owned 'Fair Go Grocers' chain draws support from the Greens and opposition from independent grocers

By LineZotpaper
Published
Read Time2 min
The federal government could buy hundreds of Coles and Woolworths stores and establish a publicly owned supermarket chain under a $25.1 billion proposal developed by the Greens-aligned Green Institute. The plan, welcomed by Greens leader David Shoebridge, would create a chain called Fair Go Grocers designed to compete directly with the major supermarkets and drive down grocery prices.

The Green Institute proposal calls for the government to acquire 200 existing Coles and Woolworths stores and three distribution centres, then build a further 424 supermarkets and 10 distribution centres over five years. The think tank envisions the new chain capturing about 20% of the grocery market, with stores operating at cost rather than generating profits for shareholders.

The institute claims Fair Go Grocers could sell essential groceries such as fruit, vegetables, bread, milk and meat for 30% cheaper than Coles and Woolworths, reducing the average grocery bill by 22%. It estimates a family of four could save about $60 a week, or more than $3,100 a year.

Independent grocers have pushed back against the proposal, arguing Australia should instead strengthen competition laws to give smaller supermarkets a better chance of competing with the major chains. Master Grocers, the industry body representing independent supermarkets, has voiced opposition to the government entering the retail sector directly.

§

Analysis

Why This Matters

  • Australian households face persistently high grocery prices, with Coles and Woolworths controlling a dominant share of the market
  • The proposal represents a radical intervention in retail markets, shifting from competition policy to direct government ownership
  • If implemented, it would mark the largest government entry into Australian retail in decades and could reshape the supermarket landscape

Background

Australia's grocery market has long been dominated by two major chains, Coles and Woolworths, which together account for a large majority of supermarket sales. The competition regulator has repeatedly examined the duopoly, and recent inquiries have highlighted concerns about pricing, supplier relationships and barriers to entry for independent grocers. The Greens have advocated for stronger action on supermarket competition, and the Green Institute proposal is the most detailed plan yet for a government-owned alternative.

Key Perspectives

Greens and the Green Institute: Argue that the duopoly's pricing power keeps grocery bills high, and only a government-owned competitor operating at cost can meaningfully lower prices. They say the $25.1 billion investment would pay off through consumer savings. Independent grocers: Oppose direct government intervention, preferring tougher competition laws that would allow smaller chains and independents to expand organically. They warn that a state-owned chain could crowd out private competition rather than fostering a level playing field. Critics/Skeptics: Question the cost and execution risk of a five-year, $25 billion build-out, and whether a government-run retailer can operate efficiently at scale without the discipline of profit-seeking.

What to Watch

  • The federal government's official response, if any, to the Green Institute's proposal
  • The next round of the parliamentary inquiry into supermarket pricing and competition
  • Whether independent grocers or the major chains launch a public campaign against the plan

Sources

Zotpaper

Written by software from the reporting listed above, scored by an automated standards desk, and published without a person reading it first. If something here is wrong, tell the editor and it will be put right.

How we workReport an errorSubscribe