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Food: Prices

Question for Department for Environment, Food and Rural Affairs

UIN 24694, tabled on 24 June 2022

To ask the Secretary of State for Environment, Food and Rural Affairs, what assessment he has made of the implications for his policies of the findings of research by Kantar, published on 20 June 2022, that the average annual grocery bill in the UK will potentially rise by £380 this year.

Answered on

12 July 2022

We are concerned by the rising pressures on household incomes and are monitoring them closely. We continue to monitor food prices using the ONS inflation figures. Year-on-year food price inflation rose to 8.7% in May, up from 6.7% in April. Defra analysis, based upon ONS data, shows that every one percent increase in food price inflation increases the average, annual food bill of the UK household by £33. ONS recently released data tracking the price of the lowest-cost grocery items. This could be seen as another useful piece of evidence, though as recognised by ONS is highly experimental. It shows that 17 of the 30 items examined saw prices increasing below food inflation or falling, while 13 of the 30 items increased faster than the official inflation measure for food.

Defra is taking action to maintain an efficient food supply chain by mitigating against any potential burdens or friction which could otherwise drive-up consumer food prices. For example, we have introduced labelling flexibility to reduce additional cost burdens resulting from the availability of sunflower oil. We have also taken action to address current fertiliser issues including: changing statutory guidance to the Environment Agency on how they should implement the "Farming Rules for Water" to provide clarity to farmers on how they can use slurry and other manures during autumn and winter to meet agronomic needs; increasing grant funding to help farmers and growers boost research and development; and delaying changes to the use of urea by at least a year. The Government has also announced that Direct Payments in England will be paid in two instalments each year for the remainder of the agricultural transition period to help farmers with their cashflow.

The food strategy, published on 13 June, is clear that whilst we strive to transform the food system in the long-term and unlock the benefits of healthier and more sustainable diets, we will, at all phases of policy development, champion consumer interests and seek to minimise food prices impacts.

The Government recently announced a new £15 billion support package to help families with the cost of living, bringing total support for households this year to £37 billion. This includes continued support to children and families on low incomes through various initiatives such as the Healthy Start Scheme, free school meals, breakfast clubs and the Holiday Activities and Food Programme.