Federation of Wholesale Distributors (FWD) Chief Executive James Bielby has appealed to Chancellor Rishi Sunak for more action to combat cost rises.
Sunak’s eagerly awaited spring statement did offer some respite with a 5 percent cut in fuel duty, the stand-out change that should help alleviate some pressure on the food and drink supply chain – although that support wasn’t mirrored in other areas.
An increase in VAT for hospitality settings, and no additional spend on public sector food contracts or measures to curb energy price increases could still cause significant damage, pointed out Bielby.
“At a time of unprecedented cost increases for wholesale across food, energy and fuel, the 5 percent cut in fuel duty announced today will go some way to relieving the eye-watering costs wholesalers currently face,” said Bielby.
“Unfortunately, nothing in the Chancellor’s statement will support businesses with the five-fold increases they have seen in energy costs, which are uncapped. We urge the Chancellor to reconsider his position on this.
“It is also disappointing that the Chancellor has decided to increase VAT for hospitality settings back to 20 percent. This will increase the cost of living for many and depress demand for an industry which has suffered significantly over the past two years, and is still not back to 2019 levels.
“Similarly, the lack of any announcement today on increasing the amount spent on public sector food contracts is worrying and may result in the supply of hot meals being untenable in schools if not addressed. The per meal rate of £2.34 per child per meal is not enough given the growing cost pressures and the funding rate for 2022-23 must be increased when the funding allocations are announced in June.”
