Sunak to urge supermarkets to cap price of food basics amid inflation

The scheme will encourage supermarkets to charge less for everyday items, but a representative for the retail sector told ITV News 'we can not go any lower'

Downing Street is drawing up plans to encourage supermarkets to introduce voluntary price caps on food staples in a bid to help with the cost-of-living crisis.

The scheme would aim to get retailers charging the lowest possible amount for some basic products like bread and milk, health secretary Steve Barclay confirmed to ITV News.

Mr Barclay said on Sunday morning: "I think everyone is concerned about the increase in food inflation and that is having an impact on the cost of living.

But we want to work constructively with supermarkets in a voluntary way, as to how we can work together to increase the cost that we've seen around food prices."

A No 10 source initially told the Sunday Telegraph that the plans are at “drawing board stage” and stressed they would not involve government-imposed price controls.

Elsewhere, a Treasury source told the paper: “Food inflation is much more resilient and difficult to get rid of than we anticipated.”

Supermarkets are expected to be allowed to select which items they would cap and only take part in the initiative, modelled on similar agreement in France, on a voluntary basis.

Andrew Opie, from the British Retail Consortium, an association that represents all UK retailers, said the government's plan would not "make a jot of difference" to prices. “High food prices are a direct result of the soaring cost of energy, transport, and labour, as well as higher prices paid to food manufacturers and farmers," he said.

The scheme would aim to get retailers charging the lowest possible amount for some basic products, like bread and milk. Credit: PA

“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."

Mr Opie claimed that by introducing a "muddle of new regulation", the government has contributed to keeping prices high.

“Rather than recreating 1970s-style price controls, the government should focus on cutting red tape so that resources can be directed to keeping prices as low as possible,” he said.

It comes after Chancellor Jeremy Hunt backed interest rate hikes, even if they risk of plunging the UK into recession, in order to combat soaring inflation.

Though down from 10.1%, the Consumer Prices Index of inflation remains stubbornly high at 8.7%, while experts have warned that alarmingly expensive food is set to overtake energy bills as the “epicentre” of the cost-of-living crisis.

Food prices are expected to keep rising, having already increased by 19.1% in the year to March, placing additional pressure on families.

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