British supermarkets are set to cap prices on everyday essentials like eggs, bread and milk under bold new government proposals – but ministers say this would not be a return to the 1970s
The government is planning a deal with supermarkets which would cap prices on everyday essentials to protect Brits from the impact of the Iran war.
Bold new proposals would see shops voluntarily cap the prices of essential items such as eggs, bread and milk, according to the Financial Times.
The Treasury has said it would in return offer supermarkets “incentives” which may include easing packaging policies and delay potentially costly changes to healthy food rules, the newspaper said.
This would be agreed to by retailers on a voluntary basis, and would not emulate the strict price controls brought in during the inflation crisis of the 1970s.
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Helen Dickinson, the chief executive of the BRC, the leading trade association for retailers, 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.”
“The challenge facing retailers is a combination of higher energy and commodity costs resulting from the Middle East conflict, and the soaring cost of the Government’s domestic policies.”
“The UK has the most affordable grocery prices in Western Europe thanks to the fierce competition between supermarkets,” she also said.
A spokesperson for the Treasury 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.”
The Treasury asked supermarkets for guarantees that British farmers would not lose income from price caps, according to the FT.
It comes after the Prime Minister said the UK will “feel the effects both the short and long-term” of the Middle East conflict – but that the government has taken decisions to protect the British public from “global shocks”.
After Keir Starmer chaired a meeting of the Middle East Response Committee with his cabinet on Tuesday afternoon, a Number 10 spokesperson said:
“The Prime Minister acknowledged the current uncertainty, stressing that we do not want to see a return to fighting and that a lasting settlement is essential for peace and stability in the region.
“He noted that, whatever the outcome, the UK will feel the effects in both the short and long-term. He invited ministers to provide updates on the extensive planning under way across supply chains, transport, energy and business sectors.
“It was highlighted that the Government’s economic plan has taken the longterm decisions needed to restore the country’s finances and protect the UK from global shocks. The UK was the fastestgrowing economy in the G7 at the start of the year, and the IMF’s upgraded growth forecast for 2026 demonstrates the country is well placed to meet these challenges.
“The meeting focused on ongoing contingency work to ensure public services are prepared for immediate pressures, including targeted support for heating oil and other measures designed to protect those most in need.”
