CMA publishes inflation update
The UK's Competition and Markets Authority has updated its work into competition in the groceries sector and is calling for reforms on unit pricing legislation.
The agency published on 20 July an initial update on its continuing work to tackle cost-of-living pressures in groceries with the publication of two reports: an assessment of retail competition in the groceries sector and a review of unit pricing practices across major retailers.
"At a time when food and other grocery prices are rising it is crucial that people can be confident that competition is working effectively to keep price rises as low as possible and that people can shop around and compare prices easily and with confidence," the CMA said in a press release.
Its three primary findings were:
- Evidence to date indicates high food price inflation has not been driven by weak retail competition, but competitive pressure is important as input prices fall
- Next phase of CMA probe will examine competition and prices across the supply chain for the product categories identified
- Rules on unit pricing should be tightened and retailers must comply to help shoppers compare prices easily
Commenting on the update, Gareth Mills, a partner at Charles Russell Speechlys said: “The current cost of living crisis has led to competition regulation and politics becoming increasingly intertwined, with the CMA’s investigatory findings and subsequent ministerial announcements to the press threatening greater regulation or oversight becoming almost weekly occurrences.
"Supermarkets should expect new levels of scrutiny and regulatory oversight as political parties of all stripes aim to position themselves as the protector of consumers.
"As increasing prices continue to be felt by the public across the country, the role of regulators in ensuring that competition is acting in the interest of consumers is likely to become more prevalent over the coming months.”