UK Supermarkets Reject Government Push for Voluntary Price Freeze on Essentials
BBC Business reported Wednesday that Britain’s government has been pressing major supermarkets to accept a voluntary grocery price freeze on staples including milk, bread and eggs, in exchange for regulatory concessions.
Government Floats Voluntary Deal, Stops Short of Mandate
Treasury secretary Dan Tomlinson confirmed discussions with retailers had taken place. He said the talks centred on steps supermarkets could take to ease cost-of-living pressures. Tomlinson was clear, however, that no mandatory price cap would be imposed. Government sources also told the BBC that no food price controls would feature in cost-of-living announcements expected Thursday.
The proposal reportedly involves freezing prices on selected products. In exchange, retailers would receive relaxed packaging requirements and a possible delay to regulations governing healthy food promotion.
Industry Reacts With Rare Unified Fury
The response from supermarket executives was swift and scathing. Marks and Spencer chief executive Stuart Machin called any government-led price cap “completely preposterous.” He urged ministers to cut the tax and regulatory burden instead of intervening in what he described as an already competitive market.
Former Ocado chairman Lord Stuart Rose told BBC Radio 4 the idea was “the stuff of nonsense” and warned it “smacks of state control.” Former Sainsbury’s boss Justin King labelled the proposals “pretty silly” and flagged potential competition law complications. He also called it hypocritical for the Treasury to seek price restraint from retailers while its own policies were adding to inflationary pressure.
Helen Dickinson, chief executive of the British Retail Consortium, argued the government should focus on reducing “public policy costs” driving food prices higher rather than reviving what she called 1970s-style price controls. A government source responded by dismissing her comments as “hysterical.”
Background: Food Inflation Climbing Again
The row arrives as official data shows UK food price inflation running at 3% annually in April, above the headline rate of 2.8%. Some industry groups warn that figure could approach 10% by year-end, partly because disruption to the Strait of Hormuz has pushed fertiliser and animal feed costs sharply higher.
The Scottish National Party has already pledged a similar but mandatory price cap scheme in Scotland. The Bank of England’s governor Andrew Bailey acknowledged a short-term benefit to capping essential prices but cautioned the approach would not hold up over time.
The episode illustrates the tension between a government seeking visible cost-of-living wins and retailers who argue market competition already keeps British grocery prices among the lowest in Western Europe.
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