Grocery shoppers are being warned of more hikes to food costs in the months ahead due to retailers passing on the cost of budget tax rises.
The British Retail Consortium (BRC) warned that food prices will increase by an average of 4.2% in the latter half of the year – piling more pressure on households at a time when consumers are already facing leaps in unavoidable costs including water, council tax and energy bills.
It blamed the impact of budget measures announced by Chancellor Rachel Reeves in October, which businesses have widely denounced as an attack on investment, jobs, and pay.
The retail body spoke up as many top retail brands reported on their Christmas progress ahead of April’s looming surge in costs.
Tesco warned of a £250m annual impact from higher employer National Insurance contributions alone from the next financial year while maintaining its annual profit forecast for 2024/25.
It cheered winning considerable market share over the festive season, leaving the UK’s biggest retailer in its best position since 2016.
More from Money
M&S reported robust growth in food sales, by 8.9% on a comparable basis, while growth in clothing and home and beauty was up by almost 2%.
Industry data released earlier this week already revealed Tesco, Sainsbury’s, Lidl and M&S were the big sales winners over Christmas, as far as groceries were concerned. Asda and the Co-op were seen as the main strugglers.
Ocado, which has a retail partnership with M&S, saw the largest growth in the online sphere.
Please use Chrome browser for a more accessible video player
0:38
Warning of price hikes ahead
Much of the focus, however, is on the future given the volume of complaints within the sector – one of the country’s biggest employers – about the budget measures.
The key message since the fiscal event has been that shoppers will pay a price.
The industry sales data, revealed by Kantar Worldpanel on Tuesday, showed the annual rate of grocery price inflation at 3.7% in the four-week December period, its highest level since March, and a jump on the 2.6% reported for the 12 months to November.
Please use Chrome browser for a more accessible video player
The BRC’s chief executive, Helen Dickinson, said on Thursday: “As retailers battle the £7bn of increased costs in 2025 from the budget, including higher employer NI (National Insurance), National Living Wage, and new packaging levies, there is little hope of prices going anywhere but up.
“Modelling by the BRC and retail chief financial officers suggest food prices will rise by an average of 4.2% in the latter half of the year, while non-food will return firmly to inflation.
“Government can still take steps to mitigate these price pressures, and it must ensure that its proposed reforms to business rates do not result in any stores paying more in rates than they do already.”
Despite the looming pressure ahead on supermarket margins from the budget, it is clear that grocery chains had a robust Christmas season.
Tesco boss Ken Murphy said: “We delivered our biggest-ever Christmas, with continued market share growth and switching gains.
“Our strong performance reflects the investments we have made, positioning Tesco as the UK’s cheapest full-line grocer for over two years, improving quality across all our ranges, with more than half of this year’s Christmas range new or improved, and providing the best experience for our customers in-store and online.”
His counterpart at M&S, Stuart Machin, said: “The external environment remains challenging, with cost and economic headwinds to navigate, but there is much within our control.
“At M&S, we stay close to our customers and their needs, and with that in mind our investment in trusted value, along with great quality, style and innovation remains our priority.”
Photographed in a beam of sunlight, Prince William walked through Westminster Abbey with the King behind him.
The ornate robes of the Order of the Bath service, two weeks ago, felt like a world away from the more modern image he wants to portray.
But as a man bestowed with so many traditional titles, it’s a new role he’s shaping for himself that is more intriguing – William, the quiet disruptor.
Image: The Prince of Wales at the Order of the Bath Service at Westminster Abbey. Pic: Andrew Parsons / Kensington Palace
In a week when Time Magazine named the Prince and Princess of Wales in its top 100 philanthropists list for “modernising royal philanthropy”, I spent the week following the prince on various engagements.
None of them particularly headline-grabbing, but all examples of how he’s setting out to do things differently, or underlining the challenges, and potential criticisms, he faces doing things his own way.
Take Tuesday, for example.
We weren’t expecting him to turn up as we waited at the Soho Hotel in London to watch a new series of films about the dangers faced by wildlife rangers, a project described as “the brainchild” of Prince William.
But all of a sudden, there he was in the room, taking the mic to explain what it really means to him.
Speaking about his drive to “give a voice to the voiceless”, it was indicative of what feels like a greater desire from him to articulate more publicly what he stands for.
Since November, when he described how he wanted to carry out his duties with “a smaller r in the royal”, you’ve got the sense William, and his team, have further wanted to cement in our minds where he sees his role.
From conversations this week, with those who work closely with him, the word “convening” came up time and again; the prince doesn’t want to waste what he knows is a unique position, to bring people together, start conversations and support those who are already doing amazing things in their communities.
Image: Prince William recording the opening scenes for a documentary about rangers and the dangers they face.
Pic: PA
Shifting the dial
But this isn’t just about him personally.
This is now a man whose vision for the monarchy, I’m told, is increasingly driven by a desire to “shift the dial on global leadership” where others may be failing.
With palace sources telling me he’d be more than happy to “be acknowledged” as a quiet disruptor, despite the criticism his new ways of working might bring.
Those who’ve known him a long time will tell you this compulsion to do things differently has been there for some time.
Image: Prince William during a recent royal visit.
Pic: PA
Dr Tessy Ojo, the chief executive from The Diana Award, has worked with Prince William and Prince Harry for over 20 years.
She said: “They would never do royal engagements from the sense of cutting the ribbon or simply being poster people. We were very clearly warned if you wanted any form of engagement, it almost had to have a whole strategy behind it.”
She told me she has always sensed how much William appreciates the responsibility that comes with his role, especially in a world where “there’s a massive demand on leadership… there’s a lot of distrust on leaders”.
“What people wanted 40 years ago from their monarch is completely different,” she said.
“I think it’s super important that as the heir, as the next monarch, he’s very in tune with what the people want, and what people expect. And being able to be that 21st century monarch, who is a present dad, but also a leader who understands how to use your leadership for social good”.
A modern royal
Wednesday, and William walked into a sweaty, but infectiously positive, community hall in Leith in Edinburgh.
No ribbon cutting here, but this is the kind of visit the prince now sees as a big deal, “impact” the buzz word ahead of any engagement now.
A very lively game of football launching what they hope will be a long-term tie-up between the Royal Foundation (their charitable trust), Leith community centre and Street Soccer Scotland.
Image: The Prince of Wales playing football during the visit to Leith.
Pic: PA
Image: Pic: PA
On Thursday, the sight of a guard of honour saluting the prince and princess, as the national anthem was played alongside HMS Glasgow, just emphasised the regular handbrake turns they face from the more relaxed to the formal, as they want to make the monarchy feel connected and relevant.
Then there is family to consider, in a way that past generations just haven’t.
Their working diaries are now arranged around their children. They’ve made no secret of that.
On paper, it means fewer engagements compared to other members of the family, and it has led to mutterings of that word no one within the palace wants to hear: “workshy”.
Image: The Prince and Princess of Wales attend the naming ceremony for HMS Glasgow.
Pic: PA
Making an impact?
But talking to people in Glasgow, away from the royal visit, I overwhelmingly found most thought William was setting a good example by putting family first.
What people were less clear on was his “social impact” work and what that is all about.
The community projects may not necessarily grab as much attention as William and his advisors want, but what will be fascinating to watch is the potential long-term impact of this new kind of ethos.
As the Prince and Princess of Wales stood on the steps of Buckingham Palace at a garden party on Tuesday, pausing for the national anthem, you can’t help but wonder whether those traditional elements of royal life could face a shake-up when one day he leads the firm full time.
Understandably, no one likes to talk about transition, and Prince William certainly doesn’t shout about his thoughts on what will come.
South Western Railway (SWR) has been renationalised this weekend as part of the government’s transition towards Great British Railways.
The train operator officially came under public ownership at around 2am on Sunday – and the first journey, the 5.36am from Woking, was partly a rail replacement bus service due to engineering works.
Image: Pic: PA
So what difference will renationalisation make to passengers and will journeys be cheaper?
What is nationalisation?
Nationalisation means the government taking control of industries or companies, taking them from private to public ownership.
England’s railway lines are currently run by train operating companies as franchises under fixed-term contracts, but Labour have said they want to take control of the lines when those fixed terms end.
Image: Transport Secretary Heidi Alexander. Pic: PA
In its manifesto, the party vowed to return rail journeys to public ownership within five years by establishing Great British Railways (GBR) to run both the network tracks and trains.
Transport Secretary Heidi Alexander, who travelled on the first renationalised departure from London Waterloo, said, before boarding, it was “a new dawn for our railways” and “a watershed moment”.
X
This content is provided by X, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable X cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to X cookies.
To view this content you can use the button below to allow X cookies for this session only.
“But I know that most users of the railway don’t spend much time thinking about who runs the trains – they just want them to work,” she added. “That’s why operators will have to meet rigorous performance standards and earn the right to be called Great British Railways.”
Please use Chrome browser for a more accessible video player
6:32
How reliable are UK trains?
How will ticket prices be affected?
Labour have argued cutting off payments flowing into the private sector could save the taxpayer £150m a year.
But the government has not explicitly promised the savings made from nationalisation will be used to subsidise fees.
It is unlikely rail fares will fall as a result of nationalisation, rail analyst William Barter told Sky News.
“The government could mandate fare cuts if it wanted to, but there’s no sign it wants to,” he said.
“At the moment, I’m sure they would want to keep the money rather than give it back to passengers. The current operator aims to maximise revenue, and there’s no reason the government would want them to do anything differently under government control.”
Please use Chrome browser for a more accessible video player
0:54
UK has most expensive train tickets in Europe
What difference will it make for passengers?
Britain’s railways are frequently plagued by delays, cuts to services and timetable issues, but Mr Barter said nationalisation will make very little day-to-day difference to passengers.
There was “no reason to think” the move would improve issues around delays and cancellation of services, he said.
“It’s going to be the same people, the same management,” he explained.
“The facts of what the operator has to deal with in terms of revenue, infrastructure, reliability, all the rest of it – they haven’t changed.”
Image: Pic: iStock
Which services are next to be nationalised?
In the longer term, the move is likely to bring “a degree of certainty compared with relatively short-term franchises”, Mr Barter said, noting the government would only want to renationalise a franchise “because in one way or another something very bad is going on in that franchise, so in a way it can only get better”.
It also means the government will have greater accountability for fixing problems with punctuality and cancellations.
Mr Barter said: “If this is the government’s baby, then they’re going to do their best to make sure it doesn’t fail. So rather than having a franchise holder they can use as a political scapegoat, it’s theirs now.”
He added: “In the short term, I don’t think you’d expect to see any sort of change. Long term, you’ll see stability and integration bringing about gradual benefits. There’s not a silver bullet of that sort here.”
Britain’s railway services were privatised in the mid-1990s.
Image: South Western Railway came under public ownership at around 2am on Sunday. Pic: PA
Now, all services run by private companies will be renationalised as contracts reach the end of their minimum terms, with the process due to be completed by the end of 2027.
The next operator’s services to be brought under public control will be c2c – which runs between London and Essex – on 20 July, with Greater Anglia following in October, before seven more companies transfer over when their franchises end in the future.
Operators that were already under public ownership are LNER, Northern, Southeastern and TransPennine Express.
Alan Yentob, the former BBC presenter and executive, has died aged 78.
A statement from his family, shared by the BBC, said Yentob died on Saturday.
His wife Philippa Walker said: “For Jacob, Bella and I, every day with Alan held the promise of something unexpected. Our life was exciting, he was exciting.
“He was curious, funny, annoying, late, and creative in every cell of his body. But more than that, he was the kindest of men and a profoundly moral man. He leaves in his wake a trail of love a mile wide.”
Yentob joined the BBC as a trainee in 1968 and held a number of positions – including controller of BBC One and BBC Two, director of television, and head of music and art.
He was also the director of BBC drama, entertainment, and children’s TV.
Yentob launched CBBC and CBeebies, and his drama commissions included Pride And Prejudice and Middlemarch.
Image: Alan Yentob (left) with former BBC director general Tony Hall in 2012. Pic: Reuters.
The TV executive was made a Commander of the Order of the British Empire (CBE) by the King in 2024 for services to the arts and media.
In a tribute, the BBC’s director-general Tim Davie said: “Alan Yentob was a towering figure in British broadcasting and the arts. A creative force and a cultural visionary, he shaped decades of programming at the BBC and beyond, with a passion for storytelling and public service that leave a lasting legacy.
“Above all, Alan was a true original. His passion wasn’t performative – it was personal. He believed in the power of culture to enrich, challenge and connect us.”
BBC Radio 4 presenter Amol Rajan described him on Instagram as “such a unique and kind man: an improbable impresario from unlikely origins who became a towering figure in the culture of post-war Britain.