INDIA

Informal Workers Stage National Protest for Labour Rights

Newsclick Report | 08 Feb 2024

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Demonstration strategically timed ahead of forthcoming National Elections to draw attention to plight of over 90% of India's workforce; Similar demonstrations scheduled to take place at state level from February 8-15

New Delhi: Thousands of informal workers representing various sectors of the unorganised workforce converged outside the Parliament on February 7, demanding comprehensive legal protections and labour rights. Following yesterday’s national protest, similar demonstrations are scheduled to take place at the state level from February 8th to 15th, with the aim of presenting core demands to state governments and political parties ahead of the elections.

The ongoing protest, organised by the Working Group on Legal Protection of Informal Workers, is witnessing participation from a wide array of trades, including construction, agriculture, domestic work, fisheries, and more.

Expressing dismay over the absence of budgetary allocation for social security in the recently presented Union Budget, the workers voiced their grievances during the Budget session of Parliament. The demonstration, strategically timed ahead of the forthcoming National Elections, aimed to draw attention to the plight of over 90% of India's workforce, contributing over 50% to the country's Gross Domestic Product (GDP).

The workers presented a list of core demands to the Parliament, the Government, and the President of India, calling for urgent legislative measures to safeguard their rights. These demands include compulsory registration of workers and unions, collective bargaining rights, and a guaranteed minimum wage based on established norms.

Among the demands were provisions for occupational health and safety, recognition of women workers, and the establishment of sectoral welfare boards empowered to address the welfare needs of workers. The workers also emphasised the need for social security measures, including a monthly pension and housing provisions.

The protest highlights the erosion of labour rights due to recent labour code reforms by the Central Government, which have dismantled sectoral protections for informal workers. The workers have also called for the withdrawal of these labour codes and the restoration of sectoral laws to ensure adequate safeguards.

In solidarity with other labour movements, the informal workers pledged their support to the struggles of central trade unions, truck drivers' unions, and farmers' unions. They have announced their support for a nationwide hartal scheduled for February 16, 2024.

Read the Full Statement Below:

Informal Workers Demand Labour Rights & Protections 

A National Dharna of unorganised sector workers has been organised before the  Parliament on 7 Feb 2024 by the Working Group on Legal Protection of Informal  Workers consisting of SEWA, NCC CL, NCL, NFUMW and Representatives of trade  unions of unorganised workers belonging to Construction, Agriculture, Domestic,  Fisheries, Forests, Handlooms and Powerlooms, Pottery, Dhobi, Hairdressers,  Tailoring, Loaders, Street vendors, and various trades and occupations in  different parts of the country have participated in this Dharna during the Budget  session of Parliament and in view of the forthcoming National Elections. A  delegation will present Memoranda to Parliament, the Government and the  President of India the Core Labour Demands of Informal workers. We are indeed  shocked that no money has been allotted in the Budget presented by Union Govt  fro Social security of Unorganised workers. 

State level Dharnas will also be held from 8th to 15th Feb and our Core Demands  presented to state governments and to political parties for inclusion in their  election manifestos. 

Informal workers constitute more than 90 per cent of India’s workers and  contribute more than 50 per cent of the country’s GDP. Yet India’s labour laws  provide very little protection for the mass of workers. Instead, the few, limited,  hard won sectoral laws for informal workers have been done away through the  infamous Labour Codes introduced by the Central Government. 

The Constitution of India mandates the State to ensure labour rights and social  security of all working people. India has declared its commitment to the  Fundamental Principles and Rights at Work of the International Labour  Organisation. It is time to implement these promises. 

As trade unions and organisations of informal workers we urge all political  parties to include in election manifestos the following concrete proposals to  protect the labour rights and social security of informal workers: 

Core Labour Demands 

1. A Comprehensive Law for Informal Workers extending Core Labour Standards  to all segments of workers – wage labour, self-employed, workers on commons,  migrants and platform workers. Such legislation must cover besides other  important rights 

a) • Compulsory Registration of workers and their unions 

• Compulsory recognition to unions chosen by workers through secret ballot

• Collective Bargaining Right 

• Grievance Redressal & Dispute Resolution mechanisms 

b) the working day to be a maximum of 8 hours and/or 48 hours a week with  double the rate of wages for overtime and one weekly off 

c) Guaranteed minimum wage calculated on the basis of the 15th Indian Labour  Conference norms and Supreme Court judgments. 

d) A minimum guaranteed income or MSP for the products of the self-employed. 

e) Occupational Health and Safety of unorganized sector workers, with Safety  measures and lists of Occupational Diseases for each major sector, besides  provision of Health card and annual health checkup. 

f) Equal pay for equal work should be restored and women workers in all sectors  should be 

recognized as workers, even for family labour at specific worksites as in  construction, brick kilns and harvesting of some crops. 

g) Sectoral Welfare Boards empowered to collect sectoral Levy of 1% to meet  welfare needs. 

h) Sexual Harassment complaints committees at ward, local bodies and district  levels. 

2. Social security must be ensured for every registered worker including ESI and  a Monthly Pension of not less than Rs 5000. Adequate provisions must be made  for Housing. Funds must be allocated for Social Security, with 3% of Central and  State budgets reserved for this purpose, as recommended by the Lok Sabha  Standing Committee on Labour, 2008 as well as 1% of GST and 2% special tax on  the super rich. The welfare needs of sectoral workers must be met through  Sectoral Welfare Boards funded through a 1% sectoral Levy. 

3. A Migrant Labour Action Plan must be mandated by law, with provisions for  compulsory registration, dry rations, child care, health care and children's  education, for all registered migrant workers. 

4. Agricultural workers and small farmers, who comprise the biggest segment of  informal workers, must be ensured a living wage, social security and minimum  guarantee of income. Their working day should be 6 hours, with a break during  the peak hot days. The Land Rights of this section must be recognised and they  must be compensated in case of displacement and job loss.

5. Rights to natural resources for livelihood should be ensured. Existing  provisions for workers who live off these resources, such as forest dwellers, fish  workers, salt pan workers and potters, should be strengthened. They need  special protections under labour law. 

6. A special law covering home based workers must be enacted to ensure  minimum guarantee of income, dispute resolution, social security, etc 

7. Comprehensive legislation for regulation of employment, working conditions,  provision of Social Security and protection from sexual harassment must be  enacted for Domestic Workers. 

8. Annual Survey of Bonded Labour and Child Labour as well as Action Plans for  Release and Rehabilitation of these sections. 

9. Withdrawal of Labour Codes and restoration of sectoral laws including the two  Building & Other Construction Workers (BOCW) Acts, the Plantation Labour Act,  the Motor Transport Workers Act and the Beedi and Salt workers’ Welfare  Cesses and Welfare Schemes. 

10. Employment Guarantee for 200 days in rural and urban areas. 

11. Existing State level laws and multiple Welfare Boards in Tamil Nadu, Kerala,  Maharashtra and other states should be protected, instead of being subsumed  under the less beneficial Central laws and Labour Codes. 

While raising these demands we also express our complete support to the  struggles of the Central Trade Unions, the truck drivers’ trade unions and the  Samyukta Kisan Morcha which comprises unions of farmers and peasants. We  support the Central Trade Unions Call for a Nationwide Hartal on 16th Feb 2024. 

We pledge to uphold the basic features of the Constitution that guarantee  Equality, Fraternity, Secularism, Socialism, and Cooperative Federalism,  especially in matters concerning Labour. We reject the ill-advised ideology of  neoliberalism which promotes “Flexible Labour” in the name of “Ease of doing  business” and erodes Labour Rights and Labour Jurisprudence based on the  values of the Constitution.

 

How Long Has Humanity Been at War With Itself?

Deborah Barsky | 08 Feb 2024

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Is large-scale intra-specific warfare Homo sapiens’ condition or can our species strive to achieve global peace?

Image Courtesy: Wikimedia Commons

The famous American astronomer Carl Sagan once said, “You have to know the past to understand the present.” But can we ever know the history of human origins well enough to understand why humans wage large-scale acts of appalling cruelty on other members of our own species? In January 2024, the Geneva Academy was monitoring no less than 110 armed conflicts globally. While not all of these reach mainstream media outlets, each is equally horrific in terms of the physical violence and mental cruelty we inflict on each other.

Chimpanzees, our closest living relatives, are known to partake in violent intra-specific skirmishes, typically to preserve privileged access to resources in response to breaches in territorial boundaries. But only humans engage so extensively in large-scale warfare.

Do massive acts of intra- or inter-populational violence conform with Darwinian precepts of natural selection, or is this something we do as a competitive response to the stresses of living in such large populations? Looking back in time can help us find answers to such questions.

Evidence preserved in the archaeological record can tell us about when and under what conditions the preludes to warlike behaviours emerged in the past. Scientific reasoning can then transform this information into viable hypotheses that we can use to understand ourselves in today’s world.

As archaeologists continue to unearth new fossil evidence at an increasing rate, so too are they piecing together the human story as one of complex interactions played out by (a growing number of) different species of the genus Homo that lived during the tens of thousands of years preceding the emergence—and eventual global dominance—of our own species: Homo sapiens.

In fact, scientists have recognised more than a dozen (now extinct) species of Homo that thrived over the millennia, sometimes sharing the same landscapes and occasionally even inter-breeding with one another. Millions of years of hybridisation is written into the genomes of modern human populations.

Although we know very little about what these paleo-encounters might have been like, progress in science and technology is helping archaeologists to find ways to piece together the puzzle of interspecific human relationships that occurred so long ago and that contributed to making us who we are today. In spite of these advances, the fossil record remains very fragmentary, especially concerning the older phases of human evolution.

First consider Homo, or H. habilis, so-named because a significant increase in stone tool-making is recognised following its emergence some 2.8 million years ago in East Africa. The evidence for the beginnings of this transformational event that would set off the spiralling evolutionary history of human technological prowess is relatively sparse. But such ancient (Oldowan) toolkits do become more abundant from this time forward, at first in Africa, and then into the confines of Eurasia by around 1.8 million years ago.

Throughout this period, different kinds of hominins adopted and innovated stone tool making, socialising it into normalised behaviour by teaching it to their young and transforming it into a cutting-edge survival strategy. We clearly observe the positive repercussions of this major advancement in our evolutionary history from the expanding increases in both the number of archaeological sites and their geographical spread. Unevenly through time, occurrences of Oldowan sites throughout the Old World begin to yield more numerous artifacts, attesting to the progressive demographic trends associated with tool-making hominins.

Tool-making was a highly effective adaptive strategy that allowed early Homo species (like H. georgicus and H. antecessor) to define their own niches within multiple environmental contexts, successfully competing for resources with large carnivorous animals. Early humans used stone tools to access the protein-rich meat, viscera, and bone marrow from large herbivore carcasses, nourishing their energy-expensive brains. The latter show significant increases in volume and organisational complexity throughout this time period.

But were these early humans also competing with one another? So far (and keeping in mind the scarcity of skeletal remains dating to this period) the paleoanthropological record has not revealed signs of intraspecific violence suffered by Oldowan peoples. Their core-and-flake technologies and simple pounding tools do not include items that could be defined as functional armaments.

While a lack of evidence does not constitute proof, we might consider recent estimates in paleodemography, backed by innovative digitised modelisation methods and an increasing pool of genetic data that indicates relatively low population densities during the Oldowan.

Isolated groups consisted of few individuals, organised perhaps into clan-like social entities, widely spread over vast, resource-rich territories. These hominins invested in developing technological and social skills, cooperating with one another to adapt to new challenges posed by the changing environmental conditions that characterised the onset of the Quaternary period some 2.5 million years ago.

Complex socialisation processes evolved to perfect and share the capacity for technological competence, abilities that had important repercussions on the configuration of the brain that would eventually set humanity apart from other kinds of primates. Technology became inexorably linked to cognitive and social advances, fuelling a symbiotic process now firmly established between anatomical and technological evolution.

By around one million years ago, Oldowan-producing peoples had been replaced by the technologically more advanced Acheulian hominins, globally attributed to H. erectus sensu lato. This phase of human evolution lasted nearly one and a half million years (globally from 1.75 to around 350,000 years ago) and is marked by highly significant techno-behavioural revolutions whose inception is traced back to Africa.

Groundbreaking technologies like fire-making emerged during the Acheulian, as did elaborate stone production methods requiring complex volumetric planning and advanced technical skills.

Tools became standardised into specifically designed models, signalling cultural diversity that varied geographically, creating the first land-linked morpho-technological traditions. Ever-greater social investment was required to learn and share the techniques needed to manipulate these technologies, as tools were converted into culture and technical aptitude into innovation.

In spite of marked increases in site frequencies and artifact densities throughout the Middle Pleistocene, incidences of interspecific violence are rarely documented and no large-scale violent events have been recognised so far. Were some Acheulian tools suitable for waging inter-populational conflicts? In the later phases of the Acheulian, pointed stone tools with signs of hafting and even wooden spears appear in some sites. But were these sophisticated tool kits limited to hunting? Or might they also have served for other purposes?

Culture evolves through a process I like to refer to as “technoselection” that in many ways can be likened to biological natural selection. In prehistory, technological systems are characterised by sets of morphotypes that reflect a specific stage of cognitive competence. Within these broad defining categories, however, we can recognise some anomalies or idiosyncratic techno-forms that can be defined as potential latent within a given system.

As with natural selection, potential is recognised as structural anomalies that may be selected for under specific circumstances and then developed into new or even revolutionary technologies, converted through inventiveness. Should they prove advantageous to deal with the challenges at hand, these innovative technologies are adopted and developed further, expanding upon the existing foundational know-how and creating increasingly larger sets of material culture. Foundational material culture therefore exists in a state of exponential growth, as each phase is built upon the preceding one in a cumulative process perceived as acceleration.

I have already suggested elsewhere that the advanced degree of cultural complexity attained by the Late Acheulian, together with the capacity to produce fire, empowered hominins to adapt their nomadic lifestyles within more constrained territorial ranges. Thick depositional sequences containing evidence of successive living floors recorded in the caves of Eurasia show that hominins were returning cyclically to the same areas, most likely in pace with seasonal climate change and the migrational pathways of the animals they preyed upon. As a result, humans established strong links with the specific regions within which they roamed.

More restrictive ranging caused idiosyncrasies to appear within the material and behavioural cultural repertoires of each group: specific ways of making and doing. As they lived and died in lands that were becoming their own, so too did they construct territorial identities that were in contrast with those of groups living in neighbouring areas. As cultural productions multiplied, so did these imagined cultural “differences” sharpen, engendering the distinguishing notions of “us” and “them.”

Even more significant perhaps was the emergence and consolidation of symbolic thought processes visible, for example, in cultural manifestations whose careful manufacture took tool-making into a whole new realm of aesthetic concerns rarely observed in earlier toolkits.

By around 400,000 years ago in Eurasia, Pre-Neandertals and then Neandertal peoples were conferring special treatment to their dead, sometimes even depositing them with other objects suggestive of nascent spiritual practices. These would eventually develop into highly diverse social practices, like ritual and taboo.

Cultural diversity was the keystone for new systems of belief that reinforced imagined differences separating territorially distinct groups.

Anatomically modern humans (H. sapiens) appeared on the scene some 300,000 years ago in Africa and spread subsequently into lands already occupied by other culturally and spiritually advanced species of Homo. While maintaining a nomadic existence, these hominins were undergoing transformational demographic trends that resulted in more frequent interpopulation encounters. This factor, combined with the growing array of material and behavioral manifestations of culture (reflected by artifact multiplicity) provided a repository from which hominin groups stood in contrast with one another.

At the same time, the mounting importance of symbolic behaviours in regulating hominin lifestyles contributed to reinforcing both real (anatomic) and imagined (cultural) variances. Intergroup encounters favoured cultural exchange, inspiring innovation and driving spiralling techno-social complexity. In addition, they provided opportunities for sexual exchanges necessary for broadening gene pool diversity and avoiding inbreeding. At the same time, a higher number of individuals within each group would have prompted social hierarchisation as a strategy to ensure the survival of each unit.

While much has been written about what Middle Paleolithic inter-specific paleo-encounters might have been like, in particular between the Neandertals and H. sapiens, solid evidence is lacking to support genocidal hypotheses or popularized images of the former annihilating the latter by way of violent processes.

Today, such theories, fed by suppositions typical of the last century of the relative techno-social superiority of our own species, are falling by the wayside. Indeed, advances in archeology now show not only that we were interbreeding with the Neandertals, but also that Neandertal lifeways and cerebral processes were of comparable sophistication to those practiced by the modern humans they encountered.

At present, apart from sparse documentation for individual violent encounters, there is no evidence that large-scale violence caused the extinction of the Neandertals or of other species of Homo thriving coevally with modern humans. That said, it has been observed that the expansion of H. sapiens into previously unoccupied lands, like Australia and the Americas, for example, coincides ominously with the extinction of mega-faunal species.

Interestingly, this phenomenon is not observed in regions with a long record of coexistence between humans and mega mammals, like Africa or India. It has been hypothesised that the reason for this is that animals that were unfamiliar with modern humans lacked the instinct to flee and hide from them, making them easy targets for mass hunting.

If large-scale human violence is difficult to identify in the Paleolithic record, it is common in later, proto-historic iconography. Evidence for warlike behaviour (accumulations of corpses bearing signs of humanly-induced trauma) appear toward the end of the Pleistocene and after the onset of the Neolithic Period (nearly 12,000 years ago) in different parts of the world, perhaps in relation to new pressures due to climate change.

Arguably, sedentary lifestyles and plant and animal domestication—hallmarks of the Neolithic—reset social and cultural norms of hunter-gatherer societies. Additionally, it may be that the amassing and storing of goods caused new inter-relational paradigms to take form, with individuals fulfilling different roles in relation to their capacities to benefit the group to which they belonged.

The capacity to elaborate an abstract, symbolic worldview transformed land and resources into property and goods that “belonged” to one or another social unit, in relation to claims on the lands upon which they lived and from which they reaped the benefits.

The written documents of the first literate civilisations, relating mainly to the quantification of goods, are revelatory of the effects of this transformational period of intensified production, hoarding and exchange. Differences inherent to the kinds of resources available in environmentally diverse parts of the world solidified unequal access to the kinds of goods invested with “value” by developing civilizations and dictated the nature of the technologies that would be expanded for their exploitation. Trading networks were established and interconnectedness favoured improvements in technologies and nascent communication networks, stimulating competition to obtain more, better, faster.

From this vast overview, we can now more clearly see how the emergence of the notion of “others” that arose in the later phases of the Lower Paleolithic was key for kindling the kinds of behavioural tendencies required for preserving the production-consumption mentality borne after the Neolithic and still in effect in today’s overpopulated capitalist world.

Evolution is not a linear process and culture is a multifaceted phenomenon, but it is the degree to which we have advanced technology that sets us apart from all other living beings on the planet. War is not pre-programmed in our species, nor is it a fatality in our modern, globalised existence.

Archaeology teaches us that it is a behaviour grounded in our own manufactured perception of “difference” between peoples living in distinct areas of the world with unequal access to resources. A social unit will adopt warlike behaviour as a response to resource scarcity or other kinds of external challenges (for example, territorial encroachment by an ‘alien’ social unit). Finding solutions to eradicating large-scale warfare thus begins with using our technologies to create equality among all peoples, rather than developing harmful weapons of destruction.

From the emergence of early Homo, natural selection and technoselection have developed in synchronicity through time, transforming discrete structural anomalies into evolutionary strategies in unpredictable and interdependent ways. The big difference between these two processes at play in human evolution is that the former is guided by laws of universal equilibrium established over millions of years, while the latter exists in a state of exponential change that is outside of the stabilising laws of nature.

Human technologies are transitive in the sense that they can be adapted to serve for different purposes in distinct timeframes or by diverse social entities. Many objects can be transformed into weapons. In the modern world plagued by terrorism, for example, simple home-made explosives, airplanes, drones, or vans can be transformed into formidable weapons, while incredibly advanced technologies can be used to increase our capacity to inflict desensitised and dehumanised destruction on levels never before attained.

Meanwhile, our advanced communication venues serve to share selected global events of warfare numbing the public into passive acceptance. While it is difficult to determine the exact point in time when humans selected large-scale warfare as a viable behavioural trait, co-opting their astounding technological prowess as a strategy to compete with each other in response to unprecedented demographic growth, there may yet be time for us to modify this trajectory toward resiliency, cooperation, and exchange.

Deborah Barsky is a writing fellow for the Human Bridges project of the Independent Media Institute, a researcher at the Catalan Institute of Human Paleoecology and Social Evolution, and an associate professor at the Rovira i Virgili University in Tarragona, Spain, with the Open University of Catalonia (UOC).

SOURCE: Human Bridges

CREDIT LINE: This article was produced by Human Bridges.

Canada Post aims to increase price of stamps; changes would take effect in May

The Canada Post logo is seen on the outside the company's Pacific Processing Centre, in Richmond, B.C., on June 1, 2017. (THE CANADIAN PRESS/Darryl Dyck)

It may soon cost more to send letters in the mail.

Canada Post is aiming to raise the cost of stamps by seven cents, to 99 cents, for stamps purchased in a booklet, coil or pane, which it says account for the majority of sales.

The price of stamps purchased individually would go up to $1.15 from $1.07 for a domestic letter.

Other products, including U.S., international letter-post and domestic registered mail, would also be affected by the rate changes.

The price increases were announced for public comment today and, subject to regulatory approvals, would take effect on May 6.

Canada Post says domestic letter mail rates have gone up twice in the last decade: by five cents in 2019 and two cents in 2020. It says the last "major pricing change" was made in March 2014.

The agency says the proposed price increase comes as it faces "considerable" financial pressure due to inflation and the fact that each year, there are fewer letters to deliver to more addresses.

It says the impact of the change is estimated to be about 65 cents per year for the average Canadian household, and about $12.07 for the average Canadian small business.

This report by The Canadian Press was first published Feb. 9, 2024.

POM POM GIRL FOR BIG OIL

Alberta’s premier Smith sees U.S. LNG export pause as opportunity

Robert Tuttle, Bloomberg News

U.S. President Joe Biden’s decision to pause approval of new liquefied natural gas export licenses is an opportunity for Canada as the country prepares to start exporting the fuel, Alberta’s premier said.

“I note, with interest, that the Americans may be pausing on their LNG export,” Danielle Smith, head of the country’s fossil fuel-producing heartland, said on Bloomberg TV. “I look at that as an opportunity for us. If we can be an additional supplier to the world of this vitally important energy source that’s also lower emissions, and lower polluting, I think we have a role to play.”

After years of delays, Canada’s first LNG export plant is scheduled to start operation as early as 2025, shipping as much as 14 million metric tons annually from British Columbia to Asia. A number of additional projects off the Pacific Coast are at various levels of development and more than a dozen have been proposed over the years. 

The U.S., which moved earlier and more aggressively than Canada to become an LNG exporter and is today among the largest producers, halted approving new export licenses in an effort to study how shipments affect climate change, the economy and national security. The moratorium is expected to disrupt billions of dollars in projects. 

Smith spoke during her first visit to Washington as premier, hammering home her province’s status as a major North American energy provider and pushing for expanded access, such as new pipelines. President Joe Biden killed the Keystone XL Pipeline upon taking office.

She said she was set to meet with Republican Senators J.D. Vance, Rand Paul, Markwayne Mullin, Marsha Blackburn, Steve Daines, Lisa Murkowski and Democrat Joe Manchin.

PROFITEERS BLAMING GLOBALIZATION

How the grocery supply chain works, from wheat fields to weekly flyers

Rosa Saba, The Canadian Press

Over the past year, the CEOs of Canada’s biggest grocery chains have become familiar faces to lawmakers studying food prices.

Executives have faced questions from MPs and battled accusations of profiteering as their earnings rise. 

But experts say the main factors that have driven grocery prices up over the past couple of years are global.

“The supply chains we have depended on for many decades now have come under massive stresses over the last five years — COVID, conflict, climate change being the most notable examples of big global macro stresses — and that is translated into broad-based inflation for all goods across the global economy,” said Evan Fraser, director of the Arrell Food Institute at the University of Guelph. 

Consumers are acutely aware of increases in food costs because other costs, especially housing, are also skyrocketing, said Fraser, and so food prices have become emblematic of a wider problem.

Because consumers don’t really understand the ins and outs of the supply chain, the bulk of the blame is often placed on the retailer, said Michael Graydon, CEO of the Food, Health and Consumer Products of Canada association. 

“People are significantly pressured from a cash flow perspective. And so ... they're seeking to blame,” he said. “And that's a bit of a challenge that the whole industry is facing.”

Higher interest rates have slowed inflation since it peaked in 2022, but grocery inflation continues to outpace the overall figure. The annual headline inflation rate was 3.4 per cent in December, while food prices rose at a rate of 4.7 per cent. 

The major commodities that soared in price and drove breakneck food inflation due to factors including the war in Ukraine have moderated, but are still higher than pre-pandemic levels, said Karl Littler, senior vice-president of public affairs for the Retail Council of Canada.

“There’s no return to the status quo,” he said. 

The supply chain

At its most simplified, the food supply chain comprises three levels. Farmers or producers are at one end and retailers on the other. In the middle are processing, shipping and manufacturing companies, making everything from packaging to ingredients to food products, and buying and selling between each other on their way to bring products to the grocery store. 

Farmers are “price-takers,” meaning the prices they’re paid for what they produce are mainly dictated by global commodity markets and not by negotiations with buyers, said J.P. Gervais, chief economist at Farm Credit Canada.

Companies in the middle section of the supply chain, such as processors and manufacturers, are also dealing with rising costs like packaging materials, wages and energy, he said. 

“While those costs may not be going up at the same pace as before, they've not come down for the most part,” he said. 

“There's a lot of pressure in the supply chain overall on margins.”

In order to mitigate rising costs, processors may change their packaging, invest in automation or alter recipes, said Graydon. But higher interest rates are making it harder to invest in adaptations.

When they’ve done all they can to mitigate rising costs, processors then turn to negotiations with grocery retailers, said Graydon. 

Over the past couple of years, retailers have been "very responsive" to price increase requests, he said. That's likely in part because the retailers have their own private-label brands and are aware of the forces driving costs higher. 

But Graydon said the consolidated nature of the grocery retail industry means retailers often have more power in negotiations, which is why the industry has been working on a code of conduct intended to level the playing field. 

The grocery store

It’s the retailers that have borne the brunt of scrutiny over food prices — and their rising profits have made them an easy target, though some industry watchers have been at odds over whether the companies are unduly profiting off of inflation.

Some of the global pressures affecting other parts of the supply chain affect retailers directly too, said the Retail Council’s Littler, like fuel prices, rising labour costs and interest rates. The others affect retailers indirectly through negotiations with suppliers. 

Requests for price increases soared over the past couple of years in frequency and in magnitude, said Littler, and it’s up to the retailer to figure out “how much is legitimate, and how much is opportunistic.” 

“They can't reasonably expect people to operate on a loss or on unsustainable margins. So if they don't accept reasonable price increases, then they won't be getting the product,” said Littler.

But similarly, he said grocers also can’t be expected to “operate with no margin or a margin that's cut to the bone.”

Large multinational suppliers of major brands are the chief concern when it comes to unreasonable requests, noted Littler.

Once a price increase request has been accepted, the grocer has to decide how much of it to pass along to the consumer, he said. 

The outlook

The good news is that things are starting to normalize along the supply chain, said Gervais, with commodity prices coming down and prices at the manufacturing level stabilizing. 

But it may take a bit more time for that to translate to the retail level, he said, as some costs — like wages and transportation — remain elevated. 

"We're one major supply shock away from seeing some disturbances in the marketplace," he noted.

"But the bottom line is, we've seen commodity prices come down, we've seen the price that food manufacturers get for their products (come down), we've seen that inflation come down." 

Littler says food inflation and headline inflation will continue to converge as the factors that have made food inflation stickier are abating.  

“I think we can look forward to a more stable period.” 

This report by The Canadian Press was first published Feb. 9, 2024.

• CANADA

Feb 8, 2024

Competition Bureau investigating use of restrictive property clauses in grocery

Rosa Saba, The Canadian Press

The Competition Bureau is investigating the use of restrictive real estate clauses in the Canadian grocery sector.

Deputy commissioner Anthony Durocher told a House of Commons committee studying food prices that these measures, often called "property controls," can be a major barrier to entry and expansion in the Canadian marketplace. 

"We are actively pursuing an enforcement investigation in the grocery sector relating to the use of property controls," Durocher told MPs on Thursday. 

The Competition Bureau confirmed the investigation via email, noting there's no conclusion of wrongdoing at this time. 

In the Bureau's June 2023 report on competition in the grocery sector, it described property controls as clauses added to a lease or deed that limit how real estate can be used by competitors.

This can include limiting the kinds of stores that can open in a mall, or limiting the kind of store that’s allowed to open in that location after a tenant leaves the property. 

For example, if a grocery store is moving to a nearby location, the property control clause could prevent a competitor from entering the old store. That might be a rival grocer or even a more specific business such as a bakery. 

The clause might also limit other stores from selling similar products. 

"The effect is they can ultimately just make it harder for a competitor to get into the same space," explained associate deputy commissioner Bradley Callaghan at the committee meeting. 

"It could be the same commercial mall, but it also could cover a wider geographic area."

The Bureau's report recommended that governments limit use of the clauses in the sector, saying they make it harder for new supermarkets to open, and can curb competition. 

Durocher said that recent amendments to the Competition Act have given the Bureau more tools to protect and promote competition, particularly through Bill C-56, which became law in December. 

"The Bureau is committed to using the new tools made available through these amendments wherever necessary to protect competition," said Durocher. 

"We are encouraged to see the Bureau is already looking to use its new powers," Audrey Champoux, a spokeswoman for Industry Minister Francois-Philippe Champagne, said in an email. 

"Canadians expect this and we are glad to see they are taking swift action." 

Keldon Bester, executive director of the Canadian Anti-Monopoly Project, welcomed the announcement of an investigation by the Bureau. 

“I’m glad to see the bureau moving quickly,” he said. 

One key amendment in C-56 broadens the scope of the kinds of agreements the Bureau can look into, said Bester. 

Previously, the Competition Act had provisions against competitors making agreements that could prevent or lessen competition in a market. Now, those provisions include agreements that aren't just between two competitors -- such as an agreement between a grocer and its landlord, explained Bester. 

Property controls also make it more attractive for companies to consolidate as a way of expanding, said Bester.

"If the prime real estate is wrapped up in these kinds of agreements, if a company wants to expand, they are encouraged to buy up and reduce competition," he said. 

The bar will be high for the Bureau to prove that such clauses are being used on a widespread basis, and that their widespread use is hurting competition, said Michael Osborne, chair of the Canadian competition practice at law firm Cozen O'Connor.

“It’s not an easy case to make, nor should it be,” he said. 

“The Competition Bureau must still prove that, overall, it causes a substantial lessening or prevention of competition.”

Durocher told MPs that property controls can be an obstacle both for independent grocery stores and chains looking to expand, as well as for foreign players to enter the Canadian market. 

"That is why one of our recommendations in the report, and this is something that a number of other countries have done, is to consider limiting their use or banning them altogether in the grocery sector, because they can be harmful to competition," he said.

Champagne recently said he's been trying to attract foreign grocers to enter Canada as a way of boosting competition.

If the bureau finds that property control agreements in Canadian grocery are limiting competition, it can make its findings public and communicate that these kinds of agreements are "no longer acceptable," said Bester. And if Bill C-59’s further amendments to the Act are passed, it will also have the power to levy fines over such agreements, he added. 

But it would also be good for governments to follow that up with legislation restricting such agreements, Bester said. 

"What we really need to be doing in Canada, at a broad level, is changing what the business as usual standard is," he said.

"By doing that -- and you do need the law to do that -- we can actually get more competition out of existing players." 

This report by The Canadian Press was first published Feb. 8, 2024.