ACS has responded to speculation around the introduction of a price cap on supermarket goods, calling on the Government to tackle the root causes of food inflation. 

Reports first published in the Financial Times earlier this week suggested that the Government had approached supermarkets about a voluntary cap on the price of essential goods. The proposals were similar to those put forward in the Scottish National Party manifesto, which would see a cap on the price of 20-50 essential items imposed on large supermarkets only. As part of the reports, it was suggested that the Government could hold back on areas of regulation like packaging reforms and HFSS interventions in exchange for retailers keeping their prices low. 

This morning, Treasury Minister Dan Tomlinson MP has been appearing on TV and radio to state that the Government is in fact not looking at introducing this measure, but is instead working to increase the powers of the Competition and Markets Authority through regulations first announced in the Kings Speech. 

ACS chief executive Ed Woodall said: “Local shops are working hard to deliver everyday low prices at the same time as their operating costs and food inflation are rising. We need the Government to set out a proper plan for supporting local shops on employment regulations, business rates relief and energy bills instead of short-lived gimmicks on voluntary price caps.”

ACS has been calling on the government to address the cost of trading and outline meaningful support for retailers as a top campaign priority this year, highlighting the cumulative impact of business rates hikes, increases in the cost of employing people, and the rising cost of energy bills in addition to the cost of adapting businesses to comply with new regulations. 

A discussion on the policy proposal from an ACS interview with Times Radio earlier this morning is available here.