Minister says Canada's largest grocery chains have agreed to 'work' on stabilizing food prices

The heads of Canada's five largest grocery chains have "agreed to work with" the federal government to stabilize food prices, Industry MinisterFranois-Philippe Champagne said Monday.

Champagne and Finance Minister Chrystia Freeland met with the heads of Loblaw, Sobeys, Metro, Costco and Walmart in Ottawa on Monday. Freeland stayed only for the first few minutes of the two-hour meeting.

"As you would expect, those are difficult discussions but much-needed discussions at a time that Canadians are feeling the high prices of groceries," Champagne said after the meeting.

"I appreciate the constructive nature of the discussions we had.Bottom line is that they agreed to work with the government to stabilize food prices in Canada."

Champagne sent out invitations Thursday afternoon to the heads of Canada's grocery giants asking them to come to Ottawa in person to meet with himself and Freeland.

Each company will work with the Liberal government to delivera plan on grocery prices specific to their operations by Thanksgiving, Champagne said.

WATCH | Grocery story CEOs called to Ottawa:

Grocery CEOs agree to work on price stabilization

12 months ago

Duration 2:27

The CEOs of Canada's five biggest grocery store chains have agreed to work with the government on price stabilization and come up with a plan to address it within three weeks. The government said if the CEOs did not meet that deadline, they could face punitive taxes.

The CEOs were invited to meetafter Prime Minister Justin Trudeau announced a number of affordability measures last week to address the rising cost of living and inflation.

Trudeau said that if thechains fail to share their plans with the federal government by Thanksgiving, Ottawa will take action.

"And let me be very clear," Trudeau said Thursday. "If their plan doesn't provide real relief ... then we will take further action and we are not ruling anything out, including tax measures."

Trudeau said Monday the meeting was called to "make sure" grocery companies haveplans to rein infood prices.

"Food is too expensive for too many families and they're making record profits and that's why we're holding them to account," Trudeau said on his way into the House of Commons.

Trudeau promised last week to introduce a number ofamendments to the Competition Act.

Those amendments wouldgive the Competition Bureau powers to compel information from grocery companies, restrict mergers between companies and prevent large grocers from starving out smaller competitors.

NDP Leader Jagmeet Singhaccused"greedy CEOs" of using "inflation as cover to drive up the cost of groceries."

Singh saidhe will introduce legislation later Monday that wouldmake it harder for major grocery companies to drive up the cost of food.

"We're proposing a law that will strengthen competition in Canada, which will put an end to price-gouging, price-fixing and to mergers which continue to allow for monopolies when it comes to our groceries," he said.

The NDP leader said asking grocery companies to stabilize prices is "ridiculous" and insistedthey have to be compelled to act with legislation.

The Retail Council of Canada, which speaks on behalf of Canada's big grocery chains, said Monday's meeting was "constructive and informative."

"Our members are always ready to participate in good faith dialogue about the food industry, inflation and affordability," a spokesperson said in a statement.

The Retail Council also said the government committed to examining the larger food supply chainnot just grocersin its efforts to stabilize prices.

More competition needed, report says

A parliamentary committee investigating high food prices said in March that if Canada's Competition Bureau finds the grocery store giants are profiting excessively from food inflation, Ottawa should consider hitting the companies with a windfall tax on excess profits.

The Competition Bureau concluded in June that Canada's grocery business doesn't have enough competition and is dominated by three domestic giants. It called on the government to encourage new market entrants to bring down prices.

After spending months examining Canada's grocery sector, the bureau concluded it's mainly controlled by three domestic companies Loblaw, Metro and Sobeys owner Empire along with foreign giants Walmart and Costco.

WATCH:Liberals announce more measures on housing, grocery prices:

Liberals announce more measures on housing, grocery prices

12 months ago

Duration 2:28

Under pressure to respond to widespread concerns about the cost of living and faced with questions about his leadership, Liberal Prime Minister Justin Trudeau announced new measures Thursday aimed at rising housing and grocery prices.

The government said it plans on changing the Competition Act to give the bureau more power to take action. The legislative changes would include allowing the bureau to "compel the production of information to conduct effective and complete market studies," a government press release said.

The release said the bureau alsowouldbe given the authority to take action against "collaboration that stifles competition and consumer choice, in particular situations where large grocers prevent smaller competitors from establishing operations nearby."