The head of major supermarket Tesco has warned that people in the UK are facing “real food poverty for the first time in a generation”.
The warning of “real food poverty” comes as many in the country struggle with the increasing costs of food and fuel due to inflation, with a former chief economist for the Bank of England warning that such inflationary conditions inflicting pain on everyday people could continue for years.
According to a report by The Times, the head of the supermarket giant Tesco, John Allan, has said that many of those who visit his stores are now seriously struggling to make ends meet.
“I was in some stores on Friday and I was hearing for the first time for many years of customers saying to checkout staff ‘Stop when you get to £40, I don’t want to spend a penny over that’,” the publication reports the grocery tsar as saying.
“I think that many of them are struggling to both be able to heat their homes and to feed their families,” he continued. “And I think we’re seeing, you know, real food poverty for the first time in a generation.”
Allan went on to express hope that the government would step in to reduce the strain on those struggling with the crisis, suggesting that the government could reverse course on a planned payroll tax hike to leave citizens with more money in their pockets.
While it appears unlikely that the government will pull back on any planned tax hikes at this stage, it is clear that those in Britain could definitely do with more cash in their current accounts, with the Bank of England warning that inflation could hit 10 per cent this year.
To make matters even worse however, one think-tank head who formerly served as the UK central bank’s chief economist warned that the damaging inflation Britain is facing could last for years.
“I’m slightly fearful, [this inflation] might stick around for some little while as well,” Andy Haldane said according to a report by The Guardian.
“This won’t be come and gone in a matter of months,” he continued. “I think this could be years rather than months.”
Meanwhile, a different economic strategist, Cribstone Strategic Macro founder Mike Harris, has warned CNBC that the UK economy is in an extremely vulnerable position as a result of the massive inflation, comparing the current situation to that facing the US Federal Reserve shortly before the 2008 crash.
Harris justified his comparison by arguing that the Bank of England has been taking measures that will not only fail to help matters in the long term, but actively cause damage to the country’s mortgage market.
“…we’re in an environment where we’re probably going to destroy more demand than we should have because the Bank of England and [former governor] Mark Carney didn’t do their job as they should have,” the strategist reportedly told the US cable channel, saying that a recent 1 per cent rate hike would not curb inflation, but instead cause problems within the market.
“It’s a little like the [Federal Reserve] in 2007 and before, where they were allowing people to take mortgages when they knew they couldn’t repay them if house prices fell because they had to refinance so there’s an inherent unsustainability,” he continued, describing the issues inflation poses for the UK lending market. “I would say the U.K. is one of the most vulnerable countries in the world right now.”