Supermarkets: Pricing

Viscount Younger of Leckie Excerpts

Monday 14th October 2013 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what discussions they have had with the major supermarkets on delivering simple and clear pricing for consumers.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie) (Con)]

The Government agree that supermarket prices should be clear so that consumers can make informed choices. The Minister for Employment Relations and Consumer Affairs held a working group meeting with the supermarkets in May to discuss unit pricing and clarity of shelf-edge labels. We are working closely with the supermarkets and look forward to their continued positive engagement to make improvements that help consumers compare pricing information.

[Lord Kennedy of Southwark (Lab)]

Does the noble Viscount not realise that we have a cost of living crisis in this country? Can he tell the House why the Government are not doing more to ensure that consumers are properly informed of the cost of everyday essentials?

[Viscount Younger of Leckie]

I should reassure the noble Lord that we are doing much. Since the working group in May, BIS has continued to engage with supermarkets to explore where further improvements can be made, and has agreed to work with supermarkets to identify barriers to doing this. We are aware that there is a bite on household spending and we are doing as much as we can to deal with that.

[Baroness Gardner of Parkes (Con)]

My Lords, is the Minister aware of the problem for older people, or people in single family units? The advantageous deals are three for two, or buy two and get one for a much cheaper price. While I think that is very desirable for people who have large numbers to feed, it is definitely a disadvantage for people who want smaller quantities. Quite a lot of food must also be wasted, because people cannot use it. Will he take up with the supermarkets the possibility of providing these large super-deductions, but also providing things that can be bought in smaller helpings?

[Viscount Younger of Leckie]

My noble friend makes a good point, and it is one of the issues that we are discussing earnestly with the supermarkets. However I should point out that “buy one, get one free” deals represent a small proportion of supermarket promotions, the majority of which are temporary price reductions. We are also in discussions over the Waste and Resources Action Programme, which works with retailers to encourage alternative promotions for perishable goods.

[Lord Kinnock (Lab)]

My Lords, is not the sense of crisis heightened by the fact that the Prime Minister appears not to know the price of a loaf of bread? Could the Minister show rather more urgency in trying to insist that retailers, including supermarkets, have a uniformity of descriptions of the pound and kilogram cost of items on their shelves so that people can make a cogent choice in deciding what the best value for money is?

[Viscount Younger of Leckie]

The noble Lord raises an important point. He may be aware that there is legislation in place, in the form of the Price Marking Order 2004, which requires the selling price and, where appropriate, the unit price—65p per 100 grams, for example—to be clearly displayed on products being offered by traders to consumers. We take this seriously and we are working hard to improve communication about and the display of these items.

[Lord Razzall (LD)]

My Lords, I assume that the Minister would wish to be congratulated on the forthcoming introduction of a consumer affairs Bill sponsored by his ministerial colleague, Jo Swinson. Can the Minister confirm that the Bill will deal with the sort of practices to which the noble Lord, Lord Kennedy, has referred?

[Viscount Younger of Leckie]

Indeed, although I have not yet seen the details of that particular Bill. Much is being done with the OFT, which is working with the supermarkets to develop a set of principles to address the concerns over special offers and promotions for food and drink. For example, the principles state that pre-printed value claims on packs, such as “Bigger pack, better value”, must be true.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, given the cost of living crisis, will the noble Viscount apologise to consumers for doing nothing about price increases, particularly the latest energy price rise? Will he tell the House why, for the first time since the war, he thinks that the Red Cross has had to launch an emergency food aid plan for our own hungry, asking volunteers in supermarkets to get shoppers to donate goods?

[Viscount Younger of Leckie]

I have no intention of apologising but I have recognised that there is a bite on household expenditure. I point out to the noble Baroness that the biggest drivers of UK food price inflation are global commodity prices, exchange rates and oil prices. As regards energy pricing, the Energy Bill, which is being led by the Department of Energy and Climate Change, will ensure that all households get the best deal for their gas and electricity by giving legislative backing to Ofgem’s retail market review.

[Lord Tebbit (Con)]

My Lords, in view of the crisis in the cost of government, would my noble friend consider getting together a group of senior retailers who would be asked to look at manifestos before an election, price up the promises and make sure that we know the unit price of government as proposed between the various parties?

[Viscount Younger of Leckie]

My noble friend makes an interesting point and it is firmly noted.

[Lord Harris of Haringey (Lab)]

My Lords, given the very rapid rise in food prices in this country, which is double the rate in Germany and France, can the noble Viscount comment on the fine of £300,000 imposed on Tesco for not properly declaring or misrepresenting a cut in price it claimed that it had made? Are the Government putting enough resources into the consumer protection world to make sure that consumers are protected against unfair offers of that sort? I declare an interest as chair of the National Trading Standards Board.

[Viscount Younger of Leckie]

I can reassure the noble Lord that we take enforcement very seriously. As the noble Lord will be aware, enforcement of the legislation is undertaken by the Office of Fair Trading and trading standards boards. If there is an issue, the first thing that complainants should do is go to trading standards. I am also extremely aware of the major supermarket that was prosecuted for giving a misleading price on strawberries.

[Lord Elton (Con)]

My Lords, will the Minister take on board the plight of elderly single people trying to follow a balanced diet? They have to try to find a loaf of bread that does not go stale before they have finished it because the loaves are all too big.

[Viscount Younger of Leckie]

Indeed, that point is also noted.

[Lord West of Spithead (Lab)]

My Lords, so that I am not caught out in the future, will the Minister tell us exactly what is meant by a loaf of bread? There seem to be so many of them.

--- Later in debate ---

[Viscount Younger of Leckie]

I hope that the noble Lord will forgive me if I say that that goes slightly beyond my brief. However, I happen to know the price of a loaf of bread.