The price shoppers pay for food in UK stores could go up by 10% this year, according to the boss of Marks and Spencer. Archie Norman, told BBC Radio 4’s Today programme: “It wouldn't be surprising to see food price inflation over the course of the year running towards 8% to 10%.
“But we don't know that yet because it runs through the year, some has gone through now but quite a lot's still to come.”
It comes after figures today showed that in real terms the average wage in the UK has gone down 2.9% - thanks to take-home pay failing to keep up with inflation. According to the Mirror that works out at £800 a year.
Asked if food price rises would be “apocalyptic”, he said: “Um, I think, you, you, have to keep it in context.”
Yesterday the Governor of the Bank of England Andrew Bailey said he felt “helpless” in the face of global pressures during an appearance before MPs. Mr Bailey told MPs at the Treasury Select Committee on Monday that UK consumer demand will be impacted by current inflation, which is the highest in 30 years, and this is expected to cause higher unemployment.
“The main driver of inflation and what brings it down is the very big, real income shock which is coming from outside forces and, particularly, energy prices and global goods prices,” Mr Bailey told MPs. “That will have an impact on domestic demand and it will dampen activity, and I’m afraid it looks like it will increase unemployment.
He told the committee that “we are walking a very narrow path” between surging inflation and risks to growth. The Governor stressed that the war in Ukraine has resulted in an unpredictable jump in inflation, highlighting that there is still a “major worry” over further rises in food prices due to the conflict.
“The Ukrainian finance minister said is that there is food in store but they can’t get it out,” he told MPs. “While he was optimistic about crop planting, as a major supplier of wheat and cooking oil, he said we have no way of shipping it out and that is getting worse.
“It is a major worry for this country and a major worry for the developing world. Sorry for being apocalyptic but that is a major concern.”
In March, UK food inflation increased by 5.9% and is expected to accelerate in the coming months.
The number of Britons buying less food due to soaring inflation has increased over the past month, according to new figures.
The Office for National Statistics (ONS) said its latest survey found that 41% of adults reported cutting back on their grocery shop due to the rising costs.
The figure, taken from poll responses between April 27 and May 8, is an increase on the 39% in the previous survey, carried out earlier in April.
Asked about Mr Bailey’s comments, Northern Ireland Secretary Brandon Lewis told the BBC on Tuesday: “I was surprised to see that particular turn of phrase, I have to say. But the Bank of England is independent, they will have their view of their assessment, their economic view of where things are and where things are going.
“We do recognise … and as a constituency MP I see the challenges that some of my constituents face, that we all face. In my part of the world, we are all – the majority of people – on oil fire heating and you see that change in the price which has a big impact on people.
“That’s why I think it is important as a Government we put in the packages of support we’ve put in and, as the Chancellor said, this is something we will keep under review because of the global pressures, as the Bank of England Governor said yesterday, that we’re seeing on economies around the world.”
The Office for National statistics recorded inflation at 7% in March and on Wednesday it is expected to unveil a figure of 8% for April. The Bank of England has said inflation is likely to peak at 10.25% during the final quarter of 2022.
