BRC warns shop prices will keep rising unless Chancellor cuts retailer costs
The British Retail Consortium (BRC) has warned the Chancellor John Healey ahead of the Budget announcement that UK shop prices will continue to rise if the government does not act now to cut retailers’ costs.
The warning came as BRC figures showed that shop price inflation rose to 2.1% year-year in October, up from 1.4% in September and above the three-month average of 1.6%.
Subscribe to TRBNon-food inflation increased to 1.7% year-on-year, following growth of 0.8% the previous month while food inflation rose to 2.9%, against 2.5% in September.
Fresh food inflation was unchanged at 2.6%, while ambient food inflation increased to 3.2% year-on-year, from 2.2% in September.
Helen Dickinson, chief executive of the BRC, said: “Shop price inflation rose to its highest level in two and a half years. The dam is starting to break on the huge wave of costs retailers have absorbed over the last two years.
“Food inflation rose again, driven by ambient groceries, although retailers still delivered plenty of promotions on sweet treats ahead of Halloween.
“Non-food inflation climbed to an almost three-year peak as high energy and transport costs pushed up prices with furniture, flooring and DIY particularly affected this month.
“The message to the Chancellor ahead of tomorrow’s Budget could not be clearer: act now or prices will keep on rising. Retailers cannot endlessly swallow higher business rates, employment costs, energy bills, and packaging taxes.
“Without a change of course, October’s jump in inflation is only the beginning. Our recipe for the Chancellor is simple. Slash employment costs. Cancel the 3.5% business rates increase. Remove shops from the high-value surtax. Otherwise, households will end up paying the price.”
