Those pre-Spending Review nerves for under pressure Chancellor Rachel Reeves won’t have been helped by today’s food and drink headlines, which are dominated by the doom and gloom of new figures showing families are cutting back on spending in the shops in their droves.
The Telegraph says nervous families are freezing spending in what it calls a blow to hopes that the UK economy will continue its recent signs of recovery, with retail sales up by just 1% in the year to May, according to new figures from the BRC.
Helen Dickinson, chief executive of the BRC, said families had “put the brakes on spending” amid growing nervousness.
The paper says the study will pile fresh pressure on Reeves amid concerns that confidence sparked by growth earlier in the year is evaporating. It claims the beleaguered Chancellor will be forced to find tens of billions of pounds more in the autumn to repair her fiscal headroom if her hopes of a growth fall short, raising the prospect on a further round of tax rises.
The FT says the figures cast doubt on the strength of consumer resilience. The value of retail sales increased at an annual rate of one per cent in May, the lowest rate in 2025 and well below the average of 2.5 per cent between January and May, according to figures published by the British Retail Consortium on Tuesday. The figure also lagged behind the April inflation rate of 3.4 per cent, suggesting a fall in real-terms spending.
The Daily Mail adds retailers are still grappling with the £5bn in extra costs from higher National Insurance Contributions introduced in Labour’s last budget whilst they also face an additional £2bn later this year from the new EPR packaging taxes.
One the recent boom areas in the economy that has also run out of steam is e-cigarettes, with The FT reporting growth in sales of the product is faltering on both sides of the Atlantic, challenging forecasts that vaping devices will become the dominant alternative to smoking. British American said last week it expected sales of its vaping devices to fall by a mid-teens percentage globally in the first half of the year.
Meanwhile in a fresh controversy for the baby food sector, The Times carries a warning that parents should not rely on shop-bought pouches or jars to feed their babies,.
It reports on updated NHS guidance advising parents that pouches, jars and trays of processed baby food should “only be used occasionally” and should not replace home-cooked meals.
The guidance says parents should never let their baby suck food from the spout of a pouch because it can cause tooth decay, and that children under 12 months should not be given snacks between meals.
It follows years of campaigning by nutrition experts, who say parents are being “misled” by packaging claims into believing that ready-made baby foods are a healthy substitute for home-cooked meals.
The FT reports on yet another cyberattack , this time on United Natural Foods, the primary distributor for Amazon-owned Whole Foods Market, which it says has been struck by outages following an attack expected to cause disruption on supermarket shelves.
UNF, which counts on Whole Foods for close to a quarter of its $31bn in annual net sales, said it had detected “unauthorised activity” on its IT systems on June 5.
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