Sainsbury’s has warned of a “pretty challenging” market in the run-up to Christmas as households are “finding it tough” and food producers face rising costs. Simon Roberts, the chief executive of the UK’s second biggest supermarket, called on the government not to “further aggravate” pressure on costs for businesses in this month’s budget.
Government Budget Concerns
Roberts emphasized the importance of avoiding the mistakes of previous budgets, particularly regarding business rates and employers’ national insurance contributions. He stated, “That’s been really hard.” After a meeting with government ministers last week, he expressed optimism that “this government is really listening to business,” especially in terms of creating more jobs for young people.
Food Inflation and Production Challenges
While food inflation is not as severe as previously forecast, Roberts warned that high energy and fertilizer costs could lead to increased food prices next year. He stressed the need for the UK to “improve food resilience and grow and produce more at home” in a more unsettled global environment. He urged the government to enhance tax breaks that support investment in technology on farms, particularly for irrigation and reservoirs, as the climate crisis is expected to result in hotter, drier summers like this year’s.
