Food bank consumers are refusing potatoes because cooking is too expensive, says Iceland boss Cost of Living Crisis

Some food bank users are turning away from items like potatoes because they can’t afford the energy to cook them, the Iceland supermarket boss said, as the rising cost of living is pushing vulnerable groups towards the financial abyss.

Richard Walker, who says the Budget chain’s 1,000 stores are in “Britain’s poorest communities”, also called on the government to help businesses forced to raise prices significantly as their own costs soar dramatically.

“I think the cost of living crisis is the most important domestic issue that we face as a country,” the Icelandic chief executive told BBC Radio 4 Today. “It’s incredibly worrying. We’re hearing from some food bank users who are turning down products like potatoes and other root vegetables because they can’t afford to cook them.”

The cost of living continues to soar, with inflation rising to a three-decade high of 6.2% in February, fueled by soaring petrol and diesel prices and a wide range of goods, according to the Bureau for National Statistics groceries to toys and games.

Annual food price inflation was 5.1%, the ONS said. Food prices rose 0.9% between January and February – the largest monthly increase since 2012.

Walker said that in reality, inflation for food “is up 10%” and is already higher for items like milk due to the cost of all the processes involved in making it.

He said that some issues affecting inflation, such as g. supply shortages, would eventually ease but others did not, and eventually the age of cheap grocery shopping in Britain could be over.

“Systematically, if you look at it, you could argue that groceries have been too cheap for too long, but [price increases] need to be adjusted in wages and productivity and everything in between,” he said. “We are doing everything we can, our customers rely on us for this value, but of course the pressure is unrelenting at the moment and is coming at us from all sides. We are not an endless sponge that can absorb everything.”

Walker said Chancellor Rishi Sunak, who is due to announce a mini-budget in his spring statement on Wednesday, could ease the pressure on businesses and help consumers. He proposed extending the household energy price cap to companies, which could potentially be paid for by a “windfall tax” on energy companies’ skyrocketing profits. That could mean an extra £100m in savings for consumers, he said, promising Iceland would “pass on every penny”.

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Walker also said the Government could perhaps delay the introduction of social security increases and postpone the introduction of environmental taxes that would cost Iceland £16m this year.

“We also need to focus on business because ultimately it is the consumer who is affected by the shortage of cash and profits,” he said.

The British Retail Consortium said its retail price index, which tracks the cost of basic groceries, rose at a slower rate than the overall food inflation rate in February.

“This suggests that retailers are being successful in containing cost increases for many key groceries,” said Managing Director Helen Dickinson. “Many supermarkets have expanded their value ranges to support lower income individuals and households. However, as retailers struggle to absorb these higher costs, store prices are likely to rise in the coming months.”

Walker said costs have been rising across the supply chain, from oil – which affects the price of all food products – to labor shortages, higher transportation costs and rising utility bills.

He also pointed to factors including shortages in supplies of fertilizer from Russia, sunflower oil from Ukraine and a £20million increase in staff costs this year as the national minimum wage is raised.

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