Premier Foods’s 5% price rise plan slated by union

The union accused the Mr Kipling and Bisto gravy maker of “passing the buck”​, and having a “lazy, short-term business plan”​.

GMB national officer Eamon O’Hearn said: “Using Brexit as an excuse to cut jobs, wages and UK workers’ ​conditions – as well as hiking prices to customers – is passing the buck.​

“The UK food and drinks industry needs leadership and long-term planning decisions, not knee-jerk reactions and lazy, short-term business planning.”​

‘Lazy, short-term business planning’​

But, commenting before the union accusation, the manufacturer claimed to have exhausted every other cost-cutting avenue.

Responding to the union criticism, the Food and Drink Federation (FDF), which includes Premier Foods in its membership, said price increases were a last resort. But, shoppers should expect “modest”​ price increases owing to the falling value of sterling.

An FDF spokesman told FoodManufacture.co.uk: “Companies have taken steps to absorb these additional costs as far as they can through efficiencies and by taking a hit in margins. ​

“Increasing the price of products is a last resort. In light of today’s difficult market conditions, consumers can expect to see a modest increase in the price they pay in the shops.”​

Premier Foods declined to respond to the union’s criticism.

The GMB called upon the Groceries Code Adjudicator (GCA) to monitor the talks between manufacturers and retailers, to make sure all parties received a fair deal. It came after the National Farmers’ Union called for greater powers​ to be given to the GCA.

‘Mid-single digit mark’​

Premier Foods revealed it was in talks with its retailer customers about price rises on Tuesday (January 10). The falling value of the pound meant it wanted to raise its prices by “around the mid-single digit mark​”​, it said. Each of its brands would receive different price rises, Premier Foods said.

Premier Foods was the latest in a series of food manufacturers to have tried to increase prices or cut costs as a response to the falling value of sterling. Since June’s Brexit vote, the pound has fallen 12.3% in value against the euro.

Unilever attempted to raise its Marmite and PG Tips​ prices by about 10% in October. The price rise sparked a GMB union backlash, claiming food manufacturing workers and shoppers shouldn’t become “collateral damage”​ victims of the government’s “chaotic”​ handling of Brexit negotiations.

In November, Mondelēz International was the centre of a social media storm after changing the shape of its iconic Toblerone chocolate bar​. Crisp maker Walkers and fish fingers maker Birds Eye raised their prices​ in the same month, by 10% and 12% respectively.