Chancellor Rachel Reeves has unveiled plans to reduce the cost of the weekly food shop by lowering import tariffs on everyday food and drink items. The move, which suspends tariffs until the end of 2028, covers £2 billion worth of imports and includes products such as fruits, pasta, and juices.
Tariff Cuts and Impact
Current tariffs range from two per cent to 50 per cent. The suspension aims to ease the financial burden on households struggling with rising living costs. While the announcement has been welcomed, Andrew Opie, director of food & sustainability at the British Retail Consortium, urged the Labour Party to go further. He stated: "While any assistance is welcome, cutting tariffs alone will barely touch the sides in offsetting the rising costs supermarkets face."
Energy Bills Set to Rise
The cost of energy is also expected to climb, with typical annual bills predicted to rise from £1,641 to £1,843 in July when Ofgem announces the new price cap. This increase of £202 follows a seven per cent drop in April, which had lowered the cap by £117. However, the upcoming rise will negate that relief. Research reveals that two-thirds of the 12 million households on standard tariffs are unaware of the impending 12 per cent increase, according to Uswitch. The same percentage said a 10 per cent price hike would negatively affect their household budget.
Consumer Responses
One in ten homes on standard tariffs said they would need to dip into savings to pay energy bills, while a sixth would cut back on essentials like food and transport. Energy expert Ben Gallizzi urged consumers to lock in cheaper fixed tariffs, which could save a typical home £233 when the July cap is enforced. He warned: "More than 10 million households on standard tariffs are sleepwalking towards energy bill hikes, with their prices predicted to increase 12% in July."
