All through the summer I kept receiving offers from my gas company to sign a two-year deal for a fixed gas price, which would allegedly guard me against any price increases. Being a naturally suspicious person all I could think of was ’what’s in for them?’
There were rumours that gas prices would fall and as I would rather believe a rumour than a utility company, I did not sign. Well, as predicted prices have plunged (pg 5). Not that you are seeing the benefit yet. And I am sure they will think of reasons to temper reductions. I expect to see phrases such as ’guarding against the volatility of the market’ or ’demand is keeping prices high’. Yes, greed has the same effect.
This week I asked Bev Hughes, MP for Stretford and Urmston, Greater Manchester, to give her view of the Northern Foods bakery closure at Trafford Park where 690 jobs are going. The bakery falls within her constituency and she has been talking to the people affected (pg 11).
She makes a point that successive Tory and Labour governments have ignored - "manufacturers cannot sustain current downward pressure on prices without serious impact on jobs and pay".
On the other hand, while governments support supermarkets charging consumers low prices, the supermarkets are inevitably going to keep as much of that low price for their own profit, especially when they are competing so hotly against each other and their results are under such intense scrutiny by the national press, not to mention their shareholders.
The government and the Office of Fair Trading must decide: do they want a Supermarket Code of Practice with any teeth or do they want to listen to the heavy lobbying of the British Retail Consortium (BRC), which represents the supermarkets, and continue to do nothing? And MPs, with the exception of Bev Hughes who speaks honestly, must stop wearing two hats on this issue, nodding duplicitiously to both manufacturers and the BRC. There should be enough profit for everyone to make a decent living.
Also in this issue Igor Bekaert take us step by step into making a delicious chocolate cake with healthy profit margins (pg 21). And BHS joins the coffee shop boom (pg 14) - with sandwiches made from scratch!