The cost of Christmas dinner is set to hit £50 for British families as retailers face mounting pressure from Labour’s recent Budget measures, experts warn.
The increase comes as the 17-month run of falling shop prices in the UK ended in November, according to the latest British Retail Consortium-NielsenIQ Shop Price Index.
Shop prices are now 0.6 per cent down from last year but have begun creeping up since October, marking the first month-on-month inflation rise in 17 months.
Food inflation remains at 1.8 per cent, with fresh food prices particularly affected due to soaring winter import costs and poor harvests.
The British Retail Consortium warns that “significant price pressures” loom on the horizon, threatening further increases for consumers.
Analysis of prices from major UK supermarkets reveals a fresh turkey will cost £28.65 this year, making it the most expensive item on the Christmas plate.
Christmas dinner costs are about to shoot up
PA
Pigs in blankets, the nation’s favourite festive dish according to 2022 data, comes in as the second priciest item at around £3.29.
A complete Christmas dinner, including turkey, pigs in blankets, potatoes, gravy, stuffing, brussels sprouts, carrots, cranberry sauce, parsnips, Yorkshire puddings, bread sauce, Christmas pudding and mince pies now averages £50.06.
Significant price variations exist between supermarkets, with Tesco and Sainsbury’s shoppers spending £51.90 and £50.84 respectively, while Asda offers a more economical option at £40.
Shadow business secretary Andrew Griffith said: “British businesses are suffering and it is now consumers who are picking up the tab for Labour’s budget mess.”
He added: “This should come as no surprise after their summer of trash talking down the economy, handing billions to their union paymasters and raising taxes to record levels.”
Julian Jessop, fellow at the Institute of Economic Affairs, warned: “These figures are worrying because they show shops are beginning to feel upward pressure and this is even before the Budget measures kick in.
“Once the impact of the national insurance increases are felt from April then the impact will be greater and the costs will inevitably get passed on to the consumer.”
Inflation has already risen from 1.7 per cent to 2.3 per cent in the 12 months to October, marking the highest increase since April.
The National Living Wage is set to rise from £11.44 to £12.21 an hour in April, marking a 6.7 per cent increase. The National Minimum Wage for 18 to 20-year-olds will see its largest increase on record, jumping from £8.60 to £10.00 an hour.
Rain Newton-Smith, chief executive of the CBI said: “The rise in national insurance, the stark lowering of the threshold, caught us all off guard.
“Along with the expansion and the rise of the National Living Wage – which everyone wants to accommodate – and the potential cost of the Employment Rights Bill, they put a heavy burden on business.”
The British Retail Consortium warns the industry faces £7billion of additional costs in 2025 due to these changes in employers’ contributions, business rates, minimum wage increases and a new packaging levy.
Experts warn that prices could rise even further if farmers follow through on threats to strike over Labour’s inheritance tax changes and accelerated withdrawal of subsidies.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, cautioned that farmer strikes could lead to empty supermarket shelves and panic buying.
“Although the UK relies on imports for roughly 40 per cent of its food, a big disruption in the supply of domestically farmed produce would lead to gaps on shelves,” she said.
Professor John Bryson from the University of Birmingham warned that farmers face multiple challenges: “Here are three shocks working together and the outcome will be inflationary as well as reducing the resilience of this country’s food system.
“The UK’s future is now extremely uncertain and much of this uncertainty comes from actions taken by this Labour Government.”
