Bank of England won't let inflation get out of control, Ramsden says

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And as if by magic... It looks like the IMF agree!

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Rishi Sunak told to trigger general election if inflation target not met

Rishi Sunak has faced calls to trigger a general election if he fails to hit his inflation reduction target.

The Prime Minister was described in the Commons as “literally the worst person” to be leading the country through a cost-of-living crisis because he “created it”.

Mr Sunak sought to brush off the attacks from the Labour benches during Prime Minister’s Questions on Wednesday, and criticised the Opposition’s plans for the economy, insisting he is “making difficult and tough decisions”.

He has previously pledged to halve the rate of inflation by the end of the year.

The Bank of England last week raised interest rates – adding to the mortgage misery for many – in a bid to tackle inflation, which has stuck at 8.7%.

Speaking in the Commons, Labour MP Alison McGovern (Wirral South) said Mr Sunak has promised to reduce inflation to 5% or lower by the end of the year before asking: “What will happen if he fails to meet that promise?

“Will it be yet more ranting on about the Labour Party or will it be the general election my constituents crave?”

Mr Sunak replied: “No, we’re sticking to the course of bringing inflation down.

“What the Labour Party needs to understand is that requires making difficult and tough decisions. It requires prioritising. It requires being able to say ‘no’ when people come looking, asking you to borrow more money.

“Those are the type of responsible decisions that I will make and the Conservative Government will make because they’re the right ones for the country.”

The Prime Minister has had responsibility for the UK economy now for 1,323 days and he's delivered... He's delivered the largest national peacetime debt ever, the largest tax burden since the Second World War, the highest core inflation since 1991, the fastest interest rate rises since 1989 and the biggest fall in living standards in our history. - Chris Bryant MP

Labour former minister Sir Chris Bryant (Rhondda) earlier said: “The Prime Minister has had responsibility for the UK economy now for 1,323 days and he’s delivered…

“He’s delivered the largest national peacetime debt ever, the largest tax burden since the Second World War, the highest core inflation since 1991, the fastest interest rate rises since 1989 and the biggest fall in living standards in our history.

“So will he stop lecturing my constituents about holding their nerve, ditch the lame excuses and admit that he is literally the worst person to be leading this country through a cost-of-living crisis because as he created it?”

Mr Sunak, in his reply, said: “What do we hear from the party opposite? Only ideas that would make the situation far worse.”

He said Sir Chris has “sat there and supported” plans from Labour to borrow more money, claimed “unaffordable” union pay demands would “make the situation worse”, adding: “And (Sir Chris) has sat there and supported plans to not exploit our domestic sources of energy, imperilling our energy security.

“Those are all things that would make not just the situation worse for British families today but for years into the future.”

Plaid Cymru Westminster leader Liz Saville-Roberts said: “The Prime Minister’s solution to inflation is to push families into poverty while letting corporate profits pile up.

“The IMF (International Monetary Fund) said this week that the way to cut inflation is for companies to cut their profit margins. It’s corporate greed fuelling inflation, not workers’ need for fair pay.

“Can he explain to the one in five people in Wales facing hunger because they cannot afford to buy decent food why they must pay his price for lowering inflation?”

Mr Sunak said Chancellor Jeremy Hunt met economic regulators on Wednesday morning in a bid to “ensure fairness of pricing” and said the IMF has “strongly endorsed” the UK Government’s plans to reduce inflation.

Source: https://www.belfasttelegraph.co.uk/business/uk-world/rishi-sunak-told-to-trigger-general-election-if-inflation-target-not-met/a443159318.html

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Key moments as supermarket bosses grilled by MPs over profiteering

MPs didn't hold back when confronting executives on profits and obscene salaries

Supermarket bosses faced a grilling yesterday by MPs over questions of profiteering and high food prices during a cost of living crisis.

MPs didn’t hold back as they laid into the executives representing four of Britain’s biggest supermarkets Tesco, Sainsbury’s, Asda and Morrisons.

Bosses left answerless when confronted by CEO’s giant pay cheque

Andy McDonald MP left his audience squirming for an answer after confronting the supermarket executives over obscene CEO pay packages.

Using the annual report from Sainsbury’s as an example, McDonald highlighted the nearly £4 million in bonuses their chief executive Mr Roberts was paid on top of his salary last year.

He broke Mr Robert’s £4.9 million salary down for them, to £408,000 a month, £94,000 a week, £2,298 an hour before comparing that to Sainsbury’s workers who are paid £11 an hour.

“How is that justifiable when the people who work for you and the people who come into stores are suffering from a grotesque cost of living crisis now?” McDonald asked.

To which Rhian Bartlett, food commercial director at Sainsbury’s, attempted an answer: “They’re set by the Remco, I don’t have any remit over setting any of those salaries so I can’t really comment any further on that today.”

“Do you not understand how that sits with the general public?” questioned McDonald.

“That these sorts of wages are being paid and you tell us that your purpose it to provide the most reasonable priced food for your customers and yet dividends is paid out and these salaries are at this level?

“Does that not chime with any of you? No, that’s just utterly staggering quite frankly.”

As his further questions were met with stone silence.

Darren Jones pushes Tesco director on rising profits during cost of living crisis

Laying bare the facts, Labour MP Darren Jones pushed Tesco on their significant profit increase over the cost of living crisis.

During the committee investigation, the supermarket bosses denied profiteering despite having evidence of increased takings perfectly put to them by Jones who led the hearing.

Asda’s representative said their profits were actually down by 25% when adjusted, whilst Tesco had made 7% less profit than the last financial year according to its director Gordon Gaya.

Jones compared Tesco profits before and after the pandemic.

“In your 2018/19 accounts you made a profit of £1.6 billion, and in your 2021/22 accounts you made a profit of £2.03 billion. So just as a very basic review of your accounts, you’ve increased your profit quite significantly haven’t you?”

Gordon Gaya said Tesco’s profitability had hovered between 2-3% in the last four years and that profits year on year for the group business were down.

However Jones pressed that the numbers he had just presented show the group profits had gone up from before the pandemic to now, ‘that’s a bigger number, essentially you’ve got more cash in the bank at the end of the day’.

He summed up: “Why is it, given the covid pandemic, the energy crisis, the increased cost to your customers, how can it be possible that you’re making hundreds of millions in additional profits?”

Supermarkets reject call for price caps on essential food items

Labour MP Ian Byrne thoroughly pressed the key figures being grilled over the accessibly of essential food items such as baby formula.

He said the images of baby formula milk locked on supermarket shelves haunts him, and asked the executives if they, like their counterparts in France, would support price caps on essential items.

Gordon Gafa of Tesco, the first to answer argued you can’t compare France to the UK, to which Byrne said ‘you can when you have locks on baby formula’ and demanded a yes and no answer.

The resounding majority answered a hesitant no. David Potts of Morrsions responded: ‘Competition leads you to the right place. The industry requires volume and you’ll see it come.’

Morrisons admits supermarket chains petrol profits have increased

The boss of Morrisons admitted to the committee that supermarkets have had increased profits at the petrol pumps, saying, ‘I think there is more profit at the retail end of fuel.’

Due to energy, labour and transport costs the ‘barrel price’ of oil had been forced up, the boss David Potts said, however admitted, ‘we can do more’.

Other supermarkets said they were waiting on a report on fuel pricing by supermarkets, which was commissioned after a competition watchdog found evidence that retailers had increased fuel prices to unnecessary high levels during a cost of living crisis.

During the meeting, MPs said the report indicated supermarkets’ profit margins have doubled to 8% on fuel over the last five years.

Source: https://leftfootforward.org/2023/06/key-moments-as-supermarket-bosses-grilled-by-mps-over-profiteering/

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Not my fault, no siree

BoE's Bailey accuses some retailers of overcharging as inflation bites

Bank of England Governor Andrew Bailey said there was evidence that some retailers are overcharging customers, adding to pressure on the sector as authorities struggle to bring down the highest inflation rate among the world's rich economies.

Bailey, who has faced criticism over the BoE's approach to addressing the surge in price growth, told the BBC that moves by regulators on retail prices, especially in the fuel market, would help to lower inflation.

"That's important. It helps us with inflation, but it's just fairer if these things are tackled. This is having very difficult effects," Bailey told the broadcaster in an interview shown on Thursday.

Britain's finance minister Jeremy Hunt met regulators last week to discuss ways to ensure consumers do not pay more than they should and those struggling to make payments receive help.

On Monday, competition regulators said drivers buying fuel at supermarkets last year paid more than they would have done otherwise due to major supermarkets increasing their margins.

In his interview with the BBC, Bailey reiterated previous comments that the BoE had to act now to bring down inflation or risk more pain from high interest rates in the future.

He declined to speculate on when borrowing costs might fall.

"I can't give you a date as to when interest rates start to come down because that really depends upon what happens over the period of time ahead, but getting inflation down is the most important thing that we have to do," Bailey said.

"It (inflation) has already started to come down and I expect ... quite a marked fall in inflation, we'll notice it. What we have to do is set the interest rate to get it all the way down to 2%."

British inflation hit a 41-year high of 11.1% in October 2022 and held at 8.7% in May, more than double the rate in the United States and much higher than in the euro zone.

Source: https://www.reuters.com/markets/europe/boes-bailey-says-some-retailers-are-overcharging-customers-bbc-2023-07-06/