A Labour minister has denied reports that the Government is considering introducing a cap on supermarket food prices to tackle the cost of living crisis.
Treasury minister Dan Tomlinson has dismissed reports suggesting the Government approached supermarkets about introducing voluntary caps on staple food items.
Earlier this morning, Mr Tomlinson said: “This isn’t something we’re looking at. You have to talk to the supermarkets about that. The Government is not looking at doing this.”
However, the energy minister indicated that officials were instead examining broader economic measures to support households.
Labour has denied reports that the Government is introducing price caps for supermarket products
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According to the Financial Times, the reported proposals would have seen shops voluntarily limit prices on essentials including eggs, bread and milk.
The British Retail Consortium responded sharply to the reported scheme, with chief executive Helen Dickinson condemning the approach.
She said: “Rather than introduce 1970s style price controls and trying to force retailers to sell goods at a loss, the Government must focus on how it will reduce the public policy costs which are pushing up food prices in the first place.”
Ms Dickinson pointed to a combination of factors squeezing retailers, citing elevated energy and commodity prices stemming from the Middle East conflict alongside mounting costs from domestic government policies.
Households have been saddled with inflation-hiked prices for goods and services | GETTY
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The BRC chief also maintained that fierce competition between supermarkets has given Britain the most affordable grocery prices in Western Europe. The reported proposals emerged against a backdrop of rising food costs, with UK food inflation climbing to 3.7 per cent in April.
It is understood the Treasury had sought assurances from supermarkets that British farmers would not see their incomes reduced by any price caps.
In exchange for voluntary price freezes, the Government reportedly offered incentives including relaxed packaging regulations and delays to potentially expensive changes to healthy food rules.
Some of these measures, including packaging regulations, currently generate revenue for the Treasury, the newspaper noted.
Supermarkets have been grappling with higher costs | PA
A Treasury spokesperson said: “The Chancellor has been clear we want to do more to help keep costs down for families, and will set out more detail in due course.”
Chancellor Rachel Reeves is scheduled to unveil cost of living measures on Thursday aimed at easing financial pressures on households.
Writing in The Times, the Chancellor signalled a tough stance on businesses seeking to profit from the current economic climate.
She said: “I will not tolerate anyone exploiting a crisis to make a quick buck off the back of hardworking people.”