The association made an urgent appeal in response to the latest statistics which revealed that while overall shop price inflation had decreased to 6.9% in August, down from 7.6% in July, food inflation remains considerably higher at 11.5%. Although there has been a slight decrease from July, when it stood at 13.1%, this persistent high food inflation rate is concerning.
Andrew Goodacre, Bira’s chief executive, expressed his concerns stating, “Despite the decline in inflation, the fact that food inflation is still in double digits is alarming because it means consumers have less money available for discretionary spending.”
He further highlighted the findings of a recent report by the Retail Sector Council, which revealed that a mere 10% increase in essential costs leads to a startling 72% reduction in discretionary expenditure. This demonstrates the significant challenges faced by businesses in the retail sector.
Bira calls for a comprehensive overhaul of business rates in the UK to relieve the burden on small businesses. Goodacre emphasized the urgent need for the government to take action, stating, “It is crucial for the government to do everything within its power to reduce cost burdens. One measure that could greatly assist small businesses is the permanent implementation of the current retail discount for business rates at 75%.”
In summary, the highlighted statistics indicate the persistent impact of high food inflation on consumer spending. Hence, it is imperative for the government to address this issue by enacting comprehensive business rates reform to support small businesses in the retail sector. The permanent implementation of the retail discount for business rates at 75% would provide much-needed relief to these businesses.
