Economy

Visy and Amcor: fat-cats play, SMEs pay

SmartCompany /

Visy chairman Richard Pratt has got a remarkably soft run from the media and our political leaders since he put his hand up to participating in a $700 million cartel with fellow packaging giant Amcor earlier this week.

But don’t let the hot air fool you: the Visy/Amcor cartel has swiped money from the hip-pockets of SMEs as surely as if they had strolled in and grabbed a wad of dollars straight out of the till.

Asked about Pratt yesterday, Prime Minister John Howard refused to comment on the case but made this comment: “For myself I have found Mr Pratt to be a generous Australian. He’s been very successful in business and my own dealings with him have always been very positive and I like him.”

The Australian newspaper yesterday was just as bad, lauding Pratt in its editorial for his “pragmatic stand” and having the “courage to make hard decisions that involve great personal cost”.

These woolly sentiments are a slap in the face to the hundreds of SMEs who have taken a hit to their bottom line over the years to pay the inflated packaging prices charged by Visy and Amcor.

The reality is, despite talk of record $40 million dollars in fines for Visy and Pratt, the outcome will barely put a dent in the billion dollar company’s bottom line.

And now the Coalition is equivocating on the question of whether we need criminal sanctions against cartels, despite a review in 2003 recommending that they be introduced for serious conduct.

Groups such as the Small Business Council of Australia and the National Independent Retailers Association have called for criminal sanctions to provide a real disincentive for big business cartel behaviour.

A recent SmartCompany/Roy Morgan poll of 824 business owners found nearly half of small and medium businesses say they have been bullied by big business.

And, it seems, they blame competition watchdog the Australian Competition & Consumer Commission for the problem, with a massive 81% saying the ACCC is not doing enough to fix big business bullying.

On the criminal sanctions, Howard will only say that “we would continue to examine the strength of the Trade Practices Law and if further changes were needed, we would implement them. But I am not making any commitment beyond that.” Labor, by contrast, has said it will introduce the laws.

SME owners will watch the ongoing saga of the Visy/Amcor cartel, and the response by our politicians to it, with interest.

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