- The SNP has proposed a legal cap on some food and drink prices.
- In response, business groups have written a joint letter urging John Swinney to abandon the plan.
- The letter states that the cap would not address the root causes of elevated food prices and would instead drive up costs.
- Ewan MacDonald-Russell, deputy head of the SRC, criticized the plan as an 'appallingly terrible idea', asserting that price caps do not tackle inflation.
- MacDonald-Russell emphasized that price caps are not a solution and merely displace costs elsewhere.
- John Swinney is scheduled to outline his programme for government on Tuesday.
Scottish business groups are calling on Deputy First Minister John Swinney to abandon his proposed legal cap on food prices, warning it could worsen the cost of living crisis. A joint letter from 23 organisations argues that the cap fails to address the root causes of elevated food prices, such as rising production and distribution costs.6
Ewan MacDonald-Russell, deputy head of the Scottish Retail Consortium (SRC), criticized the plan as an "appallingly terrible idea", stating, "Price caps don't tackle food price inflation". He emphasized that such measures are merely "gimmicks" that displace costs elsewhere, potentially leading to higher overall prices for consumers.4
MacDonald-Russell pointed to examples from Hungary, where price cap policies resulted in shortages and increased reliance on cheap imports. He noted, "We can't see a single example of where this has worked", and warned that the proposed cap could give a false promise of relief while actually increasing costs.
The letter from business groups highlights the need for a more effective approach to tackle food price inflation, suggesting that the current model is preferable. "Scottish consumers benefit from the most affordable food prices in western Europe," MacDonald-Russell added, urging the government to reconsider its strategy.
“The joint letter from 23 organisations says the cap won't address rising production, refrigeration, and distribution costs. Ewan MacDonald-Russell of the SRC warns it could make shopping baskets more expensive, citing Hungary's shortages and 'cheap imports' as a cautionary example.”
BBC
