Some food companies could use inflation as an excuse to raise prices more than necessary, the Tesco chairman said.
Asked by the BBC’s Laura Kuenssberg whether food producers were taking advantage of the poorest in society, John Allan said it was “quite possible”.
He said Tesco is trying to “mitigate price increases” with measures such as private label alternatives.
Grocery costs including milk and cheese are at their highest since 1977.
Mr Allan said supermarkets were challenging cost increases where they could – and countering those that were not legitimate.
- Why are prices rising so much?
Millions of people continue to struggle with the cost of living, which has risen steadily as Covid restrictions eased and after Russia launched its attack on Ukraine.
Inflation, which measures the rate of price increases, fell to 10.5% in December from 10.7% in November – but remains at a level not seen in 40 years.
Food prices rose 16.8% in the year to December, the Office for National Statistics (ONS) said.
Basics like milk, cheese and eggs saw the biggest increases. The prices of jam, honey and chocolate also skyrocketed. However, the rise in the price of bread and cereals slowed down.
Consumer Group Which? has also tracked how much the major retailers have increased their prices relative to their peers.
Tesco was sixth in the list of supermarkets with the highest price increases, the group said.
The supermarket inflation tracker by which? charts the annual price increases of tens of thousands of groceries and drinks over a three-month period in eight major supermarkets – Aldi, Asda, Lidl, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose.
It turns out that despite being the cheapest supermarkets overall, Lidl’s prices rose the most in December at 21.1% since that time last year, closely followed by Aldi at 20.8%.
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