Concerns over the cost, complexity and potential impact of Scotland’s proposed statutory food price cap have continued to emerge from discussions between retailers and other parts of the food supply chain at a Fair Food Summit held last month.
Ewan MacDonald-Russell, deputy head of the Scottish Retail Consortium (SRC), said suppliers were particularly concerned that costs created or displaced by a price cap could ultimately be pushed back through the supply chain.
“Food and drink suppliers were deeply concerned that the displacement of cost inherent in price caps would be passed in full or part to their businesses,” he said.
MacDonald-Russell was responding to questions about a recent Scottish Government summit on food affordability, where he said there had been concerns about the proposed approach.
He stressed he could not speak for every delegate and that there were no plenary sessions, but said: “In my interactions with other delegates I found no one who felt the best solution to food affordability in Scotland was to introduce statutory price caps.”
He said retailers had also questioned how the proposed system would operate in practice, describing it as 'exceptionally complex and costly'.
“It would not lower the cost of the full shopping basket,” he said.
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MacDonald-Russell said international experience raised further concerns, with price controls potentially creating shortages, encouraging substitution of domestic products with cheaper imports and increasing the risk of abuse of shop workers.
The SRC has instead argued that direct financial support would provide a more targeted way of helping households struggling with food costs.
“Both the SRC and charities noted that, if the policy intention is to directly help less affluent households, then the efficient and proven mechanism would be through direct targeted welfare payments to those specific households,” he said.
He also pointed to investment in food production as a way of addressing some of the external pressures contributing to food inflation.
MacDonald-Russell said the SRC had engaged with ministers and its members had provided detailed evidence since the policy was announced.
He said the organisation recognised the Scottish Government wanted to support households affected by rising food costs, but hoped ministers would reconsider the proposed mechanism.
“Our hope is when they look at the overwhelming evidence that statutory price caps are costly, ineffective, complex, and will take a long time to bring to fruition, that instead they change tack and look to more efficacious solutions,” he said.
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