Chancellor John Healey has stated the government is prepared to prevent the public from "being taken for a ride at the pump or the till" as the ongoing Iran war continues to affect prices. Writing in a weekend column, Mr Healey informed major retailers that ministers are "watching closely" for any indications of profiteering, though he noted there has been "no significant evidence of so-called price gouging" during the crisis.
The Chancellor highlighted that the conflict in the Middle East impacts national security and economic security, threatening the finances of millions of British people and increasing costs for businesses. Last week, the Bank of England maintained UK interest rates, warning that an escalation in the Iran war could push inflation above 4% next year.
The British Retail Consortium responded by suggesting the new Chancellor should instead consider the effect of tax increases, such as employers’ national insurance and business rates, on inflation. Andrew Opie of the British Retail Consortium stated that supermarkets operate in a highly competitive environment and that the Competition and Markets Authority (CMA) has repeatedly found that competition, not government action, has kept food prices as low as possible.
These comments follow earlier discussions this year when then-Chancellor Rachel Reeves raised the possibility of capping food prices to limit inflation caused by the Middle East conflict, a proposal that was met with strong opposition from supermarket bosses.