Adam Bennett

Adam is a political reporter for the New Zealand Herald.

Progressive: Big liquor payment OK

Supermarket owner says it was entitled to up to $2m payback as Key backs inquiry

Progressive Enterprises owns the Countdown supermarket chain. Photo / APN
Progressive Enterprises owns the Countdown supermarket chain. Photo / APN

Countdown owner Progressive Enterprises has confirmed it received $1 million to $2 million from a liquor company, but denies the payment was one of those Labour MP Shane Jones has alleged the supermarket chain demanded from its suppliers.

After Mr Jones' claims in Parliament this week, industry sources have told the Herald payments of up to $2 million were made to Progressive by liquor suppliers to ensure their products remained on supermarket shelves.

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Progressive's confirmation came yesterday as Prime Minister John Key gave his backing to a Commerce Commission investigation into Mr Jones' claims.

Mr Jones picked a fight with one of Australasia's biggest companies, Woolworths, this week when he alleged in the House that its subsidiary Progressive Enterprises was using standover tactics to force retrospective payments from New Zealand suppliers.

Progressive Enterprises managing director Dave Chambers, who has rejected Mr Jones' allegations, yesterday said his company had recently negotiated payments of $1 million to $2 million from a local alcohol supplier whom he would not name.

But the payment was "nothing about a retrospective charge ... it was about a change in the deal".

"There was an agreed change between the two parties to the way trade was done with an unintended consequence that valuations as had been intended didn't come about.

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"So when that was realised, that was raised between the parties and then agreed that, okay, that wasn't in keeping with the deal and so the deal was squared up. I'm very comfortable with our position on that," he said.

Leading alcohol suppliers yesterday refused to comment.

Earlier, Mr Chambers said Progressive would co-operate fully with Commerce Commission inquiries.

"If any MP or supplier has questions or concerns about our business they are welcome to contact us directly to discuss them."

Mr Jones claims suppliers had told him they had been called to meetings with the supermarket chain's managers, who demanded recompense for losses incurred last year.

"And if they don't pay these cheques, they are being told no shelf space into the future."

Mr Jones set out his allegations in a letter to the Commerce Commission yesterday.

Commission chairman Mark Berry said it was taking steps "to ascertain the basis of the allegations and whether the behaviour is a breach of the Commerce Act".

He urged anyone with information relevant to the allegations to come forward.

Both Mr Jones and Food and Grocery Council chairman Pierre van Heerden called for the commission to grant anonymity to any suppliers who came forward as the commission's Australian counterpart did when it investigated similar allegations there last year.

The commission has yet to decide whether to start a formal investigation but Mr Key yesterday said it would be "a good idea".

Commerce Minister Craig Foss also effectively pressured the commission to conduct an investigation. He had written "to bring it to their attention so that I'm kept informed of their activity in this space".

Mr Jones' letter of complaint to the commission was deemed so sensitive that Parliament's Clerk of the House took the rare step of refusing to publicly release it yesterday after it was tabled in the House due to the risk of defamation from Progressive Enterprises.

- NZ Herald

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