Personal Finance

Tesco follows Sainsbury’s, Asda and Morrisons and drops price of 500 essentials after ‘profiteering’ claims

Tesco has joined Sainsbury's, Asda, Morrisons and more in reducing the price of hundreds of products as supermarkets face allegations of profiteering from the cost of living crisis.

The retailer has slashed the price of more than 500 household staples such as fruit, vegetables, rice and tuna.

As well as groceries bought “week-in, week-out”, summer favourites have also been reduced.

It said shoppers would see an average 13 percent drop on prices for the affected items.

There will be a 5p reduction in the price of 500g packs of pasta, the second drop in recent weeks.

A 145g tin of tuna is down 10p to 80p, while frozen cod fillets are now £3.75 following a 25p reduction.

A four-pint bottle of milk will drop 10p to £1.45.

Sainsbury's and Aldi have also reduced the price of milk which has seen huge inflation in the last year.

Sainsbury's also announced it was investing £15 million to reduce the price of essentials such as rice, pasta and chicken.

Read more: Average UK Household Cost of Food

Asda announced last month it was price-locking 500 products until the end of August.

Prices have been frozen on a number of items including 1kg fusilli pasta at £1.65, a 180g bag of spinach for £1, eight beef burgers for £3, a 500g box of Kellogg's Cornflakes for £2.25, and a 40-pack of PG Tips teabags for £1.60.

Asda is currently also allowing a 30-day free trial of its delivery pass service, until July 10. To access the free delivery on online orders, customers need to sign up to one of Asda's delivery pass services - which starts at £35 for the year, or £3.50 a month.

Meanwhile Ocado dropped the price of Lurpak garlic butter by 25% and its own-brand seeded rolls by 17% in some of its price cuts, which also include M&S reductions such as yogurt, salmon fillets and avocados.

Morrisons last month announced it was cutting the price of 47 products by an average of more than 25%, while Waitrose has reduced the price of more than 200 items.

Supermarkets have been criticised for not passing on savings to customers as commodity prices drop, and have been quizzd by MPs.

Food inflation was 18.3% in May, according to Office for National Statistics (ONS) figures. It was a drop of 19% in April, but still a staggering figure keeping overall inflation stuck at 8.7%.

That higher-than-expected inflation figure led the Bank of England to raise interest rates 0.5%, with the base rate in June 5%.

Tesco, Sainsbury's, Asda and Morrisons denied profiteering when they were grilled by MPs in June.

They told the Business and Trade Committee UK retail was "the most competitive market" and that it took three to nine months for reduced wholesale costs to filter down onto the shop floor.

Tesco chief product officer Ashwin Prasad said: "We know that more than ever our customers are looking for great value, and this huge round of price cuts on 500 key household essentials will help their budgets go a little further.

"With price cuts on products like grapes, peppers, rice and tuna, customers will find it's even cheaper to eat healthily with Tesco this summer.

"And we'll continue to work closely with our suppliers to pass on price cuts to our customers whenever we can."

Supermarket petrol prices

Supermarkets have also come under fire for not passing on savings when it came to the sale of fuel.

Drivers paid nearly £1billion more at supermarket pumps last year as weak competition meant they could charge more. That amounted to a margin increase of 6p a litre.

Energy Security Secretary Grant Shapps said fuel retailers will have to publish live prices under a new law, allowing consumers to compare prices online.

The Competition and Markets Authority (CMA) investigated fuel pricing over fears price drops on the wholesale market were not being passed on to customers.

Diesel was the worst affected, with margins increasing so much drivers were paying 13p a litre more from January to the end of May 2023.

It found Morrisons had doubled and Asda had tripled their fuel margins since 2019.

And Sainsbury's and Tesco then also raised their prices.

This gave an overall increase in profit margins of 6p a litre.

CMA boss Sarah Cardell said motorists were paying more than they would “if competition was working really well”.

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Helen Barnett

Helen is a journalist, editor and copywriter with 15 years' experience writing across print and digital publications. She previously edited the Daily Express website and has won awards as a reporter. Read more here.


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