Marks and Spencer has strongly criticised a proposed new price cap rule, calling it 'completely preposterous.' The backlash comes amid reports that ministers are pressing supermarkets to cut costs for shoppers, though they will not force them to cap prices on essentials such as eggs, bread, and milk.
Government Talks on Cost of Living
On Wednesday, Labour Party Cabinet member and Treasury secretary Dam Tomlinson confirmed that talks with the supermarket sector had taken place 'about the steps that they can take to support people with the cost of living.' However, the government has stopped short of mandating price caps.
M&S Chief Executive's Response
Stuart Machin, from M&S, argued that the government should instead reduce the tax and regulatory burden on supermarkets. 'I don't think government should be trying to run business,' he said. 'They should try to understand business better. There is so much in the government's control. My advice is to try to reduce tax and regulatory burden and free us up in a very competitive market.'
Mr Machin highlighted that retailers are facing 'a triple whammy of headwinds with increased taxation, a greater regulatory burden and ongoing global conflict.' He added that ministers 'can do things to relieve some pressure and help retailers grow and invest.' He noted that the additional costs from new regulations and taxes 'does all link to employment.'
Critical Year Ahead for M&S
Mr Machin described the year ahead as 'one of the most important … in our history.' He stated, 'The next three years are critical for M&S as we invest for growth.'
Industry Leaders Criticise Price Cap Idea
Mr Tomlinson said supermarkets would not be forced to cap prices, but even a voluntary scheme was described by former chairman of Ocado and Conservative peer Lord Rose as the 'stuff of nonsense.' 'It's right that the government looks across the board at what more we can do - both government levers but also talking to industry about the steps that they can take to support people with the cost of living,' Mr Tomlinson said.
Lord Rose, a former Marks and Spencer chief executive, told the Today programme: 'I think the whole idea is the stuff of nonsense and it will never fly. This smacks of state control, it's idiotic, it's dangerous and it'll never work.' The Conservative Party peer said there was 'no better system than a free market economy.'
