The supermarket bosses appearing before MPs today (27) have insisted they are not guilty of ‘grotesque’ profiteering and have denied to back price caps.
Answering in reference to Unite union general secretary, Sharon Graham’s accusation of “grotesque display of profiteering” at a time when many families are struggling to get food onto the table, Tesco’s commercial director, Gordon Gafa, denied it, saying the supermarket makes 4p in the pound.
He reiterates that Tesco is not profiteering. Sainsbury’s Rhian Bartlett stated that her firm’s profit margins are even slenderer while Asda’s Kris Comerford stated that the 25 per cent drop in Asda’s EBITDA profits last year isn’t consistent with Unite’s claim.
In reference to why food inflation is soaring, Morrisons’ David Potts cited the example of eggs, saying the loss of birds to avian flu led to shortages of poultry meat and eggs and wholesale egg prices have gone up a lot more than either figure, he said.
Bartlett from Sainsbury’s stated that labour costs (wages), energy costs and rising commodity costs have all pushed up food inflation. It hits fresh and chilled food faster, she explains, so prices of produce, meat, fish and poultry have jumped fastest, adding that wholesale prices have started to ease, leading to price cuts for milk, bread, butter and cheese.
Supermarket bosses also has declared that they won’t back price caps on essential goods. Critics of price caps have argued they lead to shortages, as supermarkets will not want to sell products at a loss and suppliers will take their goods elsewhere.
However, supermarkets have offered backing for transparent system of live fuel pricing. Gafa said Tesco would “welcome more transparency” on fuel pricing, and would welcome a system such as in Northern Ireland where drivers can check the average fuel prices at every petrol station online.
Kris Comerford, chief commercial officer at Asda, and Bartlett from Sainsbury’s, both reply agreed to the idea of having live fuel price transparency. Potts from Morrison stated that his supermarket would be happy to look at “anything that can benefit consumers”.