UK supermarkets are being with faced with calls for the UK’s competition watchdog to investigate claims of profiteering, as food inflation soars to record levels.
The leader of the Liberal Democrats, Ed Davey, is calling on the Competition and Markets Authority (CMA) to probe into whether any profiteering was taking place in supermarkets, as the rising cost of a weekly shop adds pressure on households.
“We need to bring soaring food prices back under control and offer relief to families. That means cracking down on profiteering by food multinationals and the big supermarkets so customers get a fair deal,” Davey said.
Both Tesco and Sainsbury’s reported a drop in profits in recent weeks, but experts have said more could be done to help shoppers struggling with rising prices.
Tesco revealed that its profits have dropped by 50% from £2 billion to £1 billion for the year as customers continued to cut costs and focus on value.
Meanwhile, Sainsbury’s reported a fall in its pre-tax profit for 2022, after the supermarket chain said it has spent more than £560m on “keeping our prices low over the last two years”.
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UK manufacturer Unilever rejected suggestions that it is not protecting customers from rising prices.
“We are not profiteering in any form,” said CEO Alan Jope.
“We are very conscious that the consumer is hurting and that’s why we are not passing through the full price increases and are asking shareholders to bear some of the burden.”
His comments come as Unilever published a 10.5% increase in sales in the first three months of the year, led by a 10.7% rise in prices.
Government figures show that food and drink prices soared at the fastest annual rate in over 45 years to 19.1% in March, keeping UK inflation above 10%.
Chief executive of the BRC, Helen Dickinson commented: “The price of butter and vegetable oils started to come down as retailers passed on cost savings from further up the supply chain,” said Helen Dickinson,
Dickinson said: “We should start to see food prices come down in the coming months as the cut to wholesale prices and other cost pressures filter through. In the meantime, retailers remain committed to helping their customers and keeping prices as low as possible.”
