Who's to blame for food price hikes – supermarkets or Reeves?

Whatever happened to the supermarket price war? The latest inflation figures showed no signs of it. Food prices are surging. They recorded an ugly 4.4 per cent rise over the year to May, the sharpest increase in more than a year. That compares to the previous month's 3.4 per cent jump. Remember, those rises are cumulative.

- James Moore, The Independent

This will come as a bitter blow, particularly to low-income households for whom food takes up a disproportionate chunk of the household budget. It also raises a question: were the supermarkets pulling a fast one on us with all their talk about pumping money into lowering their prices a few short months ago? Was the supposed price war just smoke and mirrors? Or is this down to Rachel “We won't raise taxes on working people” Reeves?

When I spoke to one of the big supermarkets, they insisted that this isn’t on them, pointing to City forecasts, which clearly show that the big players are going to make less money this year than they did last year. “This is down to a combination of increased taxes, increased wages and the increased prices supermarkets are having to pay suppliers,” my source said, pointing to the sharply increased wholesale price of beef as an example of the latter. “We are competing hard, but cost inflation has to pass through at least in part.”

A particular sore point with retailers is the government's packaging levy, which it prefers to call the “extended producer responsibility” (EPR) tax. Try saying that quickly three times. This shifts responsibility for the cost of household recycling from local authorities to the companies that use the packaging.