UK supermarket bosses reject 'profiteering' charge

STORY: British supermarket bosses on Tuesday (June 27) rejected allegations they were profiteering through a cost of living crisis.

Telling lawmakers they were not passing on cost rises in full to customers in order to remain competitive.

Soaring food inflation has contributed to the biggest squeeze on living standards in Britain since records began in the 1950s.

Food prices jumped by 18.7% on the year in May.

It has all prompted questions about who is responsible for record jumps in grocery bills.

Labour MP Ian Lavery questioned executives from Tesco, Sainsbury’s, Morrisons and ASDA.

"It's been described by Sharon Graham, the general secretary of Unite, the union, that the biggest supermarkets in the UK are engaging in a, quote, grotesque display of profiteering at this time, in a time when millions of workers are struggling simply to put food on the table. What do you say to that?”

Tesco’s commercial director responded to the allegation.

"We make, and this is the whole group, four pence in every pound, which I don't think is any example of profiteering. Without customers and without the trade, there is no Tesco and we have doubled down on our competitiveness."

Sainsbury's commercial director also responded.

"We make less than three pence in the pound. We've also seen profits step back and as I said earlier, the input cost pressures that we've had have not been reflected in full shelf hedge prices. So we're doing absolutely everything we can. We really understand how much customers and also colleagues are struggling."

Labour MP Darren Jones put it to Tesco that its group profits have jumped from $2 billion before the health crisis to over $2.5 billion now.

"You've got more cash in the bank at the end of the day. Based on your reported accounts."

"Our profitability has hovered between 3 to 4 percent in the last four or five years. And I quote from our group accounts since 2019. And as I say, profits year on year for the group business are down."

The supermarket bosses argued their industry did not need an intervention because it was already highly competitive.

UK food prices are still rising rapidly but not quite as sharply as in recent months.