Grocers under growing political pressure as NDP pushes for investigation of 'profit-driven inflation'

A New Democratic Party member of Parliament wants to summon grocery executives to the House of Commons to explain why Canada's biggest supermarket chains are growing profits at a time when food inflation is rising.

As soon as next week, the House of Commons agriculture committee will vote on a motion that will investigate "profit-driven inflation" in the grocery business, according to the speaker's office.

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It was not clear if he would get enough support from other parties to pass his motion. The committee has seven Liberals, including chair Kody Blois and three Conservatives.

Regardless of the outcome, the growing public relations problem for Canada's big grocers is further evidence of a growing public relations problem.

Jagmeet Singh has become one of the most vocal critics of the grocery business and blamed corporate greed for the fastest food inflation in decades.

The CEO of Sobeys, Michael Medline made $8.6 million last year — 15% more than the year before.Did workers at his stores get a 15% raise?No.Instead, he took away their hero pay during the pandemic.

Workers deserve better. https://t.co/neumX4Izsy

— Jagmeet Singh (@theJagmeetSingh) September 16, 2022

Loblaw Cos. is the top grocer. Empire Co., Metro Inc., and Sobeys say profits and margins are not related to inflation. All say they are benefiting from increased demand for high-margin health and beauty products, now that people are going back to work.

Accounting experts say it is difficult to figure out if the explanations are true, leading to calls for a public inquiry.

Robin Shaban is a former officer at the Competition Bureau and co- founder of the Canadian Anti-Monopoly Project. There are many limits to what can be done with public information.

The notice of motion called on the committee to investigate record profits of large grocery chains and their CEOs in relation to employee wages. The investigation should look at how the grocery oligopoly is able to cut into the earnings of Canadian farmers. The notice of motion states that witnesses would include the CEOs of grocery stores.

All political parties have been feeling the heat on this. People are talking about the high cost of groceries in my house.

John Barlow, the Conservative agriculture critic and one of the committee's vice-chairs, believes that the House of Commons committee on industry should investigate wage and competition issues.

Barlow said they would try to make some changes. The way this motion is worded would be better at the industry committee because he is talking about wages and not competition.

Barlow said he would be more open to an investigation if the motion was focused on rising input costs at the farm level.

People are talking about the high cost of groceries in my house.

Alister MacGregor is a member of the House of Commons.

Bibeau wouldn't say if she supported a closer look at the grocery industry.

She said at a news conference on Wednesday that the committee could make their own decision about the studies they wanted to pursue. The price of food is a concern for us all. They will be allowed to make their decision based on their priorities.

The scrutiny on profits is unwarranted, according to grocery leaders. Karl Littler, senior vice-president at the Retail Council of Canada, told the House of Commons finance committee that people in Canada don't understand how inflation works.

Inflation in Canada has been at historic lows for over 30 years, according to Littler, whose organization represents the big grocers. Some commentators are rushing to judgement or seek to play the blame game for their own purposes, because of the lack of modern experience.

Empire chief executive Michael Medline spoke at the company's annual general meeting about the controversy.

He said that he was tired of armchair quarterbacks who were comfortable sitting on the sidelines andpontificating about how Canadian companies are reaping unreasonable profits on the backs of inflation.

That caught the attention of the leader of the New Democratic Party, who complained that Medline's compensation was 15 per cent less than it would have been in 2020. Workers at his stores got a raise. It is not possible to say yes. Singh said that the hero pay was taken away during the Pandemic due to the June 2020 scandal.

Empire's net income was little changed from a year earlier in its most recent quarter. In its most recent quarter, Loblaw's profits increased by 22 per cent over last year. Metro reported a nine per cent increase in profits.

The chief executives of the three companies did not answer questions about their participation in the House of Commons hearing.

The email address is jedmiston@postmedia.