MPs To Hold Inquiry Into Supermarket Pricing As Cost Of Staples Soars
3 min read
The environment, farming, and rural affairs (EFRA) committee has ordered an inquiry into food supply and prices as large supermarkets see their profits soar despite the cost of living crisis.
Earlier this week PoliticsHome reported the committee was considering the action, with committee chair Sir Robert Goodwill suggesting supermarket bosses could be questioned by the crossparty group of MPs as part of an inquiry into supermarket pricing.
The intervention comes after the Office for National Statistics (ONS) reported food and drink items saw on average a 19 per cent increase for the year to March 2023 – despite the wholesale prices of staples like wheat falling over the last 12 months.
Costs according to the Consumer Price Index (CPI) are also significantly lower than food inflation at 10.1 per cent, according to the ONS.
The average price of bread has increased by 29 per cent from £1.07 to £1.38, with the average price of olive oil increasing from 49 per cent from £3.87 to £5.78.
Hard cheese increased on average by 44% from £6.92 to £9.98, with sugar increasing 42 per cent from 73p to £1.04 on average.
The terms of reference for the committee's inquiry will include the structure and operation of the food supply chain; market power and regulation; food prices, security and fairness; and affordable and healthy food.
The committee has said in particular it will explore how profitability and risks are shared through the supply chain and how it is regulated by government – as well as other factors including the price of imported food and global commodity prices.
EFRA committee chair Goodwill said MPs sought to "get to the bottom of what's going on".
“During these times of high food price inflation, when many people are struggling to give their families good food at a reasonable price, it’s our job as a committee to get to the bottom of what’s going on," he added.
“We know that consumers are paying higher prices, but the question is – are the other parts of the supply chain unduly benefitting from that, or are some of them also feeling the squeeze?
“We need to strike the right balance to ensure healthy, affordable – and preferably British-produced – food is available to all of us.”
Trade union Unite recently accused supermarket giant Tesco of "excessive profiteering" after £704 million was paid in dividends to shareholders in 2021/22; it also claimed its research shows profit margins at UK supermarkets have increased by 89 per cent since 2019.
Last week Anna Taylor, chief executive of the Food Foundation, told PoliticsHome it was important the government was "asking the questions" of supermarket pricing amid the cost of living crisis.
“The government can, and the select committee should, be asking those questions – because the impacts of the rising food prices are so dramatic on families," Taylor said.
"We're really, really concerned about their impact on the health of children – because of the knock on effect that it has on their diet, the levels of stress at home [is] immense, they're struggling, families struggling to put food on the table.
“And that obviously has knock-on impacts on children's wellbeing so all the questions should be being asked, for sure."
PoliticsHome Newsletters
PoliticsHome provides the most comprehensive coverage of UK politics anywhere on the web, offering high quality original reporting and analysis: Subscribe
