Full Breakdown
National Party proposes structural split of Foodstuffs supermarkets
By Drooid · · How we work
Core Event
National’s finance spokesperson Nicola Willis announced that, if re-elected, the party will amend the Grocery Industry Competition Act within its first 100 days to give the Commerce Commission a new mandate to assess a structural separation of the Foodstuffs co-operative. The proposal would divide Foodstuffs into two nationwide groups – one comprising Pak’nSave stores and the other combining New World and Four Square – creating three major grocery chains alongside Australian-owned Woolworths. The Commission would receive NZ$5 million and six months to test commercial viability, implementation costs, regional access and impacts on owner-operators before making a formal recommendation. National says legislation would follow only if the Commission recommends the split.
Background & Context
Foodstuffs and Woolworths together control roughly 82 percent of New Zealand’s grocery market, a concentration that has drawn repeated scrutiny from the Commerce Commission and the government’s Grocery Commissioner. Rising living costs have made supermarket competition a focal point of the 2026 election campaign, with National positioning the split as a way to lower prices for households while other parties propose price-gouging bans or a state-owned “Kiwi-Mart”.
Data & Statistics
- Sense Partners’ cost-benefit model estimates total benefits of NZ$14 billion over 20 years, a 26 percent net gain over costs of NZ$11.1 billion.
- Consumer-welfare gains are projected at NZ$13.1 billion; operating-profit losses for supermarkets would total NZ$10.9 billion.
- The analysis predicts grocery prices could fall 3.5 percent after one year and 5 percent after six years, equating to household savings of up to NZ$1,320 per year.
Official Statements & Responses
Willis framed the plan as a “fairer deal at the checkout” and emphasized that any structural change would be evidence-based. The Commerce Commission, while not yet having issued a recommendation, has previously noted weak competition in the sector.
Criticism & Opposition
Business groups argue the split could duplicate logistics and administrative functions, raising costs that may be passed to shoppers. Manufacturers Association chief Alan McDonald called the policy “too close for comfort” and a “terrible signal” to investors.
Verbatim Quotes
- “National will pursue the structural separation of Foodstuffs, subject to an independent Commerce Commission assessment, so Kiwis get a fairer deal at the checkout,” — Nicola Willis
- “Uncoupling these groups by brand means establishing completely separate, duplicated administration and marketing functions as well as the challenges of splitting logistics and distribution functions (which already leverage economies of scale) across the entire country,” — Chris Wilkinson, group managing director
Conflicting Reports & Gaps
The Sense Partners model assumes modest increases in supply-chain costs (1 percent in its central scenario) but notes that a 2 percent rise would shrink net benefits to NZ$920 million. Local owner-operators such as Eric Rush argue that splitting the co-operative “would do the opposite” of lowering prices, citing the risk of duplicated costs. No definitive legal analysis has confirmed whether the government could compel property-ownership changes, and the Commerce Commission’s upcoming six-month review is the only mechanism identified for resolving these uncertainties.
What’s Next
The Commerce Commission’s six-month assessment will begin after the election, with any legislative action contingent on its recommendation. The November 7 election will determine whether National’s plan proceeds, while other parties continue to propose alternative competition measures.