(Bloomberg) -- UK Prime Minister Rishi Sunak’s government is seeking an agreement with supermarkets to voluntarily limit prices on basic food items like bread and milk in order to tackle inflation.
The government is working with supermarkets to address food prices and the cost of living, and in a way that is “very mindful to the impact on suppliers,” Health Secretary Steve Barclay said in an interview on the BBC’s Sunday with Laura Kuenssberg program.
“This is about having constructive discussions with supermarkets about how we work together, not about any element of compulsion,” Barclay said.
The story was first reported by the Sunday Telegraph, which said the proposals are at drawing board stage.
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Sunak has made reducing consumer prices a centerpiece of government policy and has pledged to get inflation to around 5% by the end of the year. He’s running out of time, as the inflation rate has defied forecasts for three months in a row, extending further into everyday items like groceries and mobile phone bills. The rate was at 8.7% in April, down from more than 10% at the start of the year.
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If introduced, a cap would be the strongest attempt in managing prices since controls established by conservative Prime Minister Edward Heath in the 1970s.
The proposal is reminiscent of an agreement in France, where retailers agreed to charge the “lowest possible amount” for some essential items. Earlier this month, French finance minister Bruno Le Maire announced an extension of the initiative.
Read more: French Retailers Agree to Margin Hit to Curb Food Inflation
(Flips story to lead with Barclay confirming talks)
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