Supermarkets charge UK consumers more than rest of Europe
The monopoly enjoyed by supermarkets in the UK is allowing them to increase food prices at a higher rate than on the continent, according to a controversial report compiled for the Royal Bank of Scotland.
The cost of groceries in the UK is going up almost three times as quickly as in the rest of Europe and consumers are paying 5.6% more for their shopping than they did a year ago, compared to 1.9% more in the Eurozone.
Report authors Geoffrey Dicks and Ross Walker qualified their findings and said that rising energy prices are believed to have pushed up the cost of many products, and poor harvests have not helped the process in recent months.
But this does not explain why prices are rising so much faster in the UK than in the Eurozone. The report’s authors wrote: “Over the years, as the supermarket giants have built up their market share, they have come to dominate food sales…
“At the same time they have progressively extended their reach into non-food… it may be that they are increasingly able to exploit their monopoly position and raise prices, even when consumer spending is not especially robust.”
The report – entitled ‘The Return of Rip-Off Britain?’ – found tea and coffee prices, for example, soared 10.2% in the UK over 12 months, compared to a much gentler rise of only 1% on the Continent.