No evidence ‘weak competition’ leading to high supermarket food prices – Hunt
Food prices continue to rise, but increases have fallen to single digits for the first time in 16 months, according to data from Kantar.
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Your support makes all the difference.An investigation into high food prices has not yet found evidence of “weak competition” among supermarkets, the Chancellor has told MPs worried about price gouging.
Jeremy Hunt said the Competition and Markets Authority (CMA) would continue to investigate food price rises, as he heard concerns about companies making “bonanza” profits while families suffered.
Food prices continue to rise, but increases have fallen to single digits for the first time in 16 months, according to data from analysts Kantar.
Can (the Chancellor) tell me, why does he believe that it is right for companies to profit while families struggle to feed their babies?
Prices across grocers were 9.7% higher than a year ago over the four weeks to October 29, down from the previous month’s 11%.
It is the eighth consecutive decline in the rate of price rises since the figure peaked at 17.5% in March, and the first time the figure has fallen below 10% since July last year.
In the Commons, SNP MP Alison Thewliss drew attention to the high price of baby formula.
The Glasgow Central MP said: “Between March 2021 and April 2023, the cost of first infant formulas increased by an average of 24%, with the cheapest infant formula on the market increasing by 45%, an absolute catastrophe for families who rely on infant formula, but a bonanza for the formula companies who are making significant profits out of this.
“Can he tell me, why does he believe that it is right for companies to profit while families struggle to feed their babies?”
They (The CMA) have not yet found evidence that high food price inflation is being driven by weak competition, but they are continuing their review
The Chancellor replied: “She is absolutely right to draw attention to the pressures on families caused by very high food inflation in a number of areas, but I can tell her that the Competition and Markets Authority undertook a review earlier this year of the groceries sector.
“They have not yet found evidence that high food price inflation is being driven by weak competition, but they are continuing their review, they are looking at the supply chain and we all wait to hear what they say.”
Mr Hunt continued to face pressure from the SNP about food inflation, with Glasgow North MP Patrick Grady calling on the Government to “commit to ensuring that the Department for Work and Pensions has enough resource to raise benefits at least in line with September’s inflation rate”.
The Chancellor replied: “The Secretary of State for Work and Pensions (Mel Stride) is doing his review at the moment to decide the correct amount by which to uprate benefits.”
Mr Hunt later insisted it was right that the CMA carried out its work on supermarket pricing “at arm’s length from politicians”, after SNP economy spokesman Drew Hendry quoted consumer rights organisation Which?, who claimed some supermarkets had committed “dodgy practices over food prices and loyalty schemes”.
The senior Cabinet minister said: “I can tell him that we had the supermarkets in over the summer to make sure that they were doing everything they could to bear down on food price inflation.
“However, the correct way for politicians to look at this is at arm’s length. We have the independent Competition and Markets Authority, which does a rigorous job and often does things that politicians disagree with, and it is looking at the issue right now.”