Editor’s View: Politicians blind to end of cheap food era
© Andrew Lockie/Alamy Stock Photo News of this week discussions between the Treasury and retailers over voluntary price caps on key groceries is another dispiriting insight into the lack of serious attention food policy is given.
Why are prices going up? Because costs are going up.
Why are costs going up? In part because of the unfurling global mega-shock linked to the Iran conflict, but also because the government is driving them higher through its own choices.
See also: Climate experts urge food stockpiling to avoid shortages
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One can only imagine what the ideas discarded as being too ludicrous were in Westminster, if the best proposed solution so far to hold down food prices is:
“Have we considered asking the grocers nicely?” Are they even aware staple foods are often already loss leaders?
Meanwhile, the food supply chain is groaning under significant increases to the cost of fuel, electricity, standing charges, national insurance, packaging and compliance (such as the 24% increase to Food Standards Agency meat inspection charges).
And the only mitigations to date are a one-third cut to red diesel duty and an extension on the wider fuel duty freeze for rest of year.
Perhaps the most charmingly naive line in the whole price cap story, first reported by the Financial Times, was:
“The Treasury has also told supermarkets that it would like guarantees that British farmers would not lose income from shop price caps.”
No word, as yet, on whether there is concern about the many other reasons farmers lose money from producing food.
I wouldn’t hold your breath; I’ve been told the government is also looking at further cuts to tariffs on imported food which could increase competition yet again from farmers overseas who can produce more cheaply than we can.
Of course, Labour isn’t the only party examining food inflation at the moment.
This week’s revelations follow similar moves by the SNP to compel supermarkets in Scotland to limit the cost of up to 50 essential food items such as milk, eggs, cheese and rice.
And voluntary price caps were also examined in May 2023 by then prime minister Rishi Sunak and chancellor Jeremy Hunt, following the sharp jump in food inflation at the start of the Ukraine conflict.
The indifference of politicians of all power-wielding parties to the end of the cheap food era is coming home to roost, and it is the poorest in society that will suffer while the taxpayer subsidises lunches in Parliament.
Home-grown production is already in decline. As we report this week, the beef herd continues to shrink and there are plenty of other examples. It makes us more exposed to each supply shock.
We could start to battle our way out of the current shock by taking a leaf out of the Australian government’s playbook and underwriting the risk of high-cost fertiliser imports.
But we must also urgently prepare – as the Climate Change Committee warns this week – for future disruption by committing to more ambitious food production targets and considering large-scale national food stockpiling.
Hopefully our leaders, having fantasised about zero-cost solutions, will reluctantly accept that they instead must live in the real world with the rest of us.