Gauteng MEC calls for probe into ‘anticompetitive practices’ of supermarkets

Gauteng economic development MEC Lebogang Maile has asked the Competition Commission to investigate possible anticompetitive practices by large anchor supermarkets that prevent competing businesses from entering shopping malls.

This emerged during Maile’s budget vote presentation in the legislature on Monday.

Maile said powerful supermarkets had made it difficult for new entrants to succeed through the practice of exclusivity clauses in long-term lease agreements between anchor supermarkets and property developers in shopping malls.

The lease conditions stipulate that no rival supermarket can take up tenancy in the mall, and they often span over decades, and such lease conditions are dictated by the anchor supermarket.

“In some instances retailers like butchers and bakers are sometimes prevented from renting a space in malls, as they are perceived to be a competitor to the anchor supermarket. This practice reduces product and retail diversity and deprives consumers,” Maile said.

His department has asked the Competition Commission to investigate the matter.

He said the commission had to consider several variables, such as bylaws associated with mall infrastructure investment, budget reallocation for bulk infrastructure from other community social needs, monetary loss for local vendors or compensation, and local procurement.

“The technical recession that we currently find ourselves in signals a need for a different model of development and investment in working-class communities. It is not acceptable that black townships have become consumption centres for monopoly capital goods without tangible developmental outcomes,” Maile said.

He said communities where malls were located had become an epitome of unemployment, poverty and social inequality.

Meanwhile, the Gauteng legislature’s portfolio committee on infrastructure development has expressed concern about the reduced targets for infrastructure development in the province’s budget.

The committee was reacting to the tabling of the Gauteng department of infrastructure development’s budget of R2.5 billion for the current financial year by MEC Jacob Mamabolo on Monday. The budget increased by 1% compared to R2 050 698 000 allocated in the previous financial year.

Committee chairperson Lindiwe Lasindwa further criticised the provincial infrastructure development department for having appointed an auctioneer to dispose identified noncore and nonstrategic state assets when it was not even able to complete its assets register.

Lasindwa, however, welcomed the committee’s allocation of R1.9 billion to the Immovable Asset Management subprogramme

The amount given was meant to implement the Provincial Property Management Optimisation Plan, which governed the disposal of noncore and nonstrategic assets. “The committee also notes that a private auctioneer has been appointed to manage the online auctioning process to dispose of the identified properties.”

The committee, however, remains concerned on how the department will achieve this, noting that it has been unable to provide the complete asset register.

“The view of the committee is that the department should expedite the completion of the asset register in order to achieve its planned targets,” Lasindwa said.

A sum of R304.6 million, representing a 9% increase, was allocated to an expanded public works programme in the Mfuleni Municipality, Cullinan and Harmanskraal, among other areas.

Lasindwa said her committee was unhappy about the department’s failure to meet its targets with regard to the allocated budget for Military Veterans Associations.

– ericn@citizen.co.za