Business groups urge Swinney to scrap 'ineffective' food price cap plan

Key Points:

• Twenty-three Scottish business groups, including the Scottish Retail Consortium and Food and Drink Federation Scotland, have jointly criticized the Scottish government's proposed legal cap on certain food and drink prices, calling it ineffective and potentially harmful.
• The Scottish government's plan aims to limit costs on essential items like milk, eggs, cheese, and rice to help ease the cost of living, but critics argue the cap won't address underlying causes such as rising production and distribution costs.
• Opponents warn that price caps could lead to shortages, distort market competition—particularly disadvantaging small shops not covered by the legislation—and potentially increase overall shopping costs due to businesses absorbing the scheme's expenses.
• The proposal may require amendments to the UK Internal Market Act 2020 to proceed, as the act prevents regulatory divergence between UK nations, adding complexity and delay to potential implementation.
• The Scottish government maintains that tackling the cost of living is a top priority, is engaging with stakeholders, and plans to launch a consultation to gather further views on the food price control proposals.