Cap in hand
Desperate Sunak in supermarket talks to limit cost of bread & milk
DESPERATE Rishi Sunak is drawing up plans for supermarkets to place a cap on the price of basic items such as bread and milk.
No10 is increasingly worried the cost of living crisis could derail the Tories’ slim hopes of winning the next election.
Amid mounting pressure on family budgets, retail bosses have held talks in recent days with Chancellor Jeremy Hunt and the Prime Minister, who yesterday tackled the Northallerton 10k run in his North Yorkshire constituency.
Surging inflation for food was at a shocking 19.1% in the year to April.
A No10 source said proposals were at the “drawing board” stage.
The source told The Sunday Telegraph: “The pressures are such that we are working with retailers on anything that can be done at their end to bring down prices for consumers. The opt-in scheme, modelled on a similar agreement in France, would allow supermarkets to select which items they would cap.
Health Secretary Steve Barclay insisted: “This is about having constructive discussions with supermarkets about how we work together, not about any element of compulsion.”
He added ministers wanted to “address the very real concerns around food inflation and the cost of living, and do so in a way that is also mindful to the impact on suppliers”.
But Mr Barclay admitted small, familyrun businesses would themselves be under “significant pressure”.
Supermarket chains have been forced to deny claims of profiteering and inflicting “greedflation” on customers as prices surge. But British Chambers of Commerce director general Shevaun Haviland told BBC1’s Sunday with Laura Kuenssberg: “No one’s profiteering.”
Andrew Opie, director of food and sustainability at the British Retail Consortium, warned that voluntary price controls “will not make a jot of difference to prices”.
He added: “Supermarkets have always run on very slim margins, especially when compared with other parts of the food supply chain, but profits have fallen significantly in the last year.
“Rather than recreating 1970s-style price controls, the Government should focus on cutting red tape so resources can be directed to keeping prices as low as possible.” While any agreement would be voluntary, the intervention would still amount to the biggest attempt to manage prices since Tory PM Edward Heath set up controls in 1973.
Shadow Work and Pensions Secretary Jonathan Ashworth said: “Rishi Sunak is now like a sort of latter-day Edward Heath. The reason why we’ve got such an inflation problem in this country is because of 13 years of failure where we’ve not invested in sustainable energy, we cut our gas storage and we’re not improving the labour supply.
“We could take measures now to get inflation under control and to grow our economy but instead you’ve got Jeremy Hunt saying, ‘Oh we might need to go into a recession’, as if worklessness, unemployment and people losing their homes is a price worth paying.”
The reason we’ve got an inflation problem is 13 years of Tory failure
LABOUR’S JONATHAN ASHWORTH ON PM’S PLANS
TEMPORARY price caps on milk, bread and other basic foods could help families but they hide a deeper problem.
The Government is guilty of sub-contracting solutions on to supermarkets when Tory economic disasters are at the root of hardship.
Covid and Putin’s invasion of Ukraine hit other countries too yet inflation is higher here and we were slower to recover after the virus.
Sunak should look in the mirror if he wants to see who is really at fault.