'Madness': Seymour warns politicians in 'state of panic' responding to cost-of-living

Act’s David Seymour claims politicians are in a “state of panic” and risk destroying investor confidence in New Zealand with their proposed interventions in the supermarket sector.

Businesses, including supermarkets and banks, have “become the whipping boys for frustration” in New Zealand over the cost-of-living, the Act leader says.

He’s taken another crack at other parties’ supermarket policies, including National and NZ First’s promise to pursue a structural separation of FoodStuffs, Labour’s price-gouging ban, and the Greens’ desire for a state-run supermarket.

Seymour said he didn’t “accept the premise that this market isn’t competitive”.

Act’s focus this election would be on making it “easier for new businesses to to arrive and join a competitive market”, he said.

“Competition is exactly what’s given us click and collect, and grocery delivery.

“New supermarkets keep opening, both major players and disruptive independents. Kai Co in Christchurch is one example. So are the Asian and Indian grocers where you can buy international produce, or dense, protein-rich lentils for a couple of dollars a kilo.”

He highlighted already-announced policies from Act, including its proposed “one-stop consenting shop” to streamline entry into the market by new players, as well as changing product labelling laws to cut red tape.

“We need to step back from the abyss of madness where politicians fit up a different scapegoat every year to blame for your problems, hoping your vote with give them another three years to think of a real solution,” Seymour said.

“We need to call out political opportunism for what it is, naked self-preservation masquerading as moral principle. We need to end the state of panic that is engulfing the political class, and rediscover belief in the future.”

David Seymour wants an end to the 'state of panic' he says some are in. Photo / Alyse Wright

Seymour’s central argument in his speech today to the Aurecon engineering consultancy group in Newmarket was that some politicians’ response to cost-of-living woes was misguided.

He acknowledged “people feel poorer than they used to”, blaming a mix of high prices, wages barely keeping pace with inflation, and productivity problems.

“They’re understandably angry at the areas where they see their paycheque used up. The checkout, the pump, the rates bill,” Seymour said.

That feeling of anger and helplessness creates a vacuum. Nature may abhor a vacuum, but politicians love one."

He said politicians, in trying to respond, “have entered a phase of political panic”.

“Every week we hear another policy that fails to address the problem of poor productivity growth and will in fact make it worse.”

He identified National’s promise to break up Foodstuffs (a policy that depends on approval from the Commerce Commission that it would lead to greater benefits to shoppers than costs).

“It has caught the most attention because that party traditionally holds itself out as a sober and sensible broker of economic policy,” Seymour said.

Seymour said this policy, as well as those proposed by other parties, were a “good response to focus groups, people are angry at the people who are taking the cash off them in return for goods”.

“Of course, they are only focusing on the cost half of the equation, and they are creating a sense of political panic in the process.”

He said that instead of “addressing the underlying problem, they will destroy the confidence to invest”.

“They will undermine confidence in the future. Why invest and innovate - the activities we need for productivity growth - if you could be one bad political focus group away from having your business attacked by your own government?”

Nicola Willis believes separation is necessary to enhance competition. Photo / RNZ

When National announced its policy, intended to enhance competition in the sector, it leaned on independent advice showing households could save between $2.85 and $25.38 a week, depending on how much shopping they did.

The overall benefit would, however, be impacted if the restructuring led to higher than assumed supply chain costs in the long run.

“The Commerce Commission has found weak supermarket competition is not working well for shoppers,” National finance spokeswoman Nicola Willis said.

“Foodstuffs North Island, Foodstuffs South Island and Woolworths still account for around 82% of the market combined, leaving New Zealanders with little choice about where to shop.”

Willis said New World and Pak’nSave brands “would compete harder on prices, specials and service if they were genuinely independent of each other”.

But Seymour said supermarkets don’t “have a monopoly on a single item”, saying there are butchers, bakers, greengrocers, chemists, hardware stores and liquor stores that compete with them.

“It is wrong to say New Zealanders have only two options, we actually have many. So I question the story that New Zealand has some unique duopoly strangling competition.”

He said the “worst cost” was that such a policy may tell entrepreneurs and foreign investors: “don’t bother building here”.

“Grow a successful business in New Zealand, and if a politician spots votes in tearing it apart, they will. Why would the next great innovator choose that?”

National has repeatedly said its decision to pursue structural separation is limited to the supermarket sector and it wouldn’t seek to make a similar intervention elsewhere.

But Seymour said the effect of these policies would resonate beyond supermarkets.

Act’s focus would be on bringing down barriers for new entrants, Seymour said, including through the creation of a single entity for which businesses can get consents and approvals.

“A one-stop shop means one process, one timeline, one government working with you instead of 40 separate hurdles.”

Act would also change product labelling rules to allow those from “trusted regulatory systems like the UK, EU, and US by default”.

“This will lower the barrier to entry for international supermarkets, who will no longer need to do expensive runs of products specifically for the tiny Australasian market to open stores.”

Jamie Ensor is the NZ Herald’s chief political reporter, based in the press gallery at Parliament. He was previously a TV reporter and digital producer in the Newshub press gallery office. He was a finalist in 2025 for Political Journalist of the Year at the Voyager Media Awards.