Asda Boss: Labour’s Profiteering Claims Have “Zero Credibility”
The boss of Asda has dismissed Labour’s claims that businesses are profiteering from the war in Iran, accusing Ministers of having “zero credibility” in remarks signalling a breakdown in relations between the Government and business. The Telegraph has the story.
Allan Leighton, the supermarket’s Executive Chairman, said: “The Government strategy is called ‘Point your finger at somebody else’.”
Rachel Reeves and other Ministers have accused businesses of profiteering and “price-gouging”. Sir Keir Starmer has also promised new powers for the competition regulator to crack down on such practices.
However, the Asda chief said the Government’s claims had “zero credibility”, adding that a crackdown was “a complete waste of time”.
Leighton was one of a number of supermarket bosses who snubbed a meeting with the Chancellor on Thursday to discuss the crisis.
He said ministers wanted to “pretend that [they’re] telling people off about gouging of petrol pricing, which you don’t have to be Einstein to work out is pretty impossible”.
“Thankfully we’ve all got better things to do than play that particular political shenanigan game,” he said.
The comments are the strongest sign yet of a breakdown in relations between Labour and businesses triggered by the war in Iran.
Frustrations are boiling over as the Government tries to signal its support for the public by threatening to crack down on any businesses that exploit the crisis.
However, bosses argue that the warnings are misplaced and are only fuelling resentment and abuse of shop and petrol forecourt staff.
The Treasury was forced to postpone a meeting with supermarket bosses about protecting customers this week after only one grocery chief – Morrisons’s Rami Baitieh – said he was able to attend at such short notice.
Lord Wolfson, the Chief Executive of Next, warned the Government against profiteering through higher tax on fuel on Thursday. Fuel duty and VAT account for more than half of the price of a litre of petrol.
Lord Wolfson said: “I think that would be a very reasonable ask for the industry to say that to the Government, ‘Don’t actually make more money out of this than you were expecting.’”
Worth reading in full.
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Context: We do not import oil from the ME.
UK petrol primarily comes from crude oil imported from the US and Norway, or extracted from the North Sea. Although the UK produces North Sea oil, much of it is exported for refining, while the UK imports refined petrol and diesel to meet demand, largely due to reduced domestic refining capacity.
Key Sources of UK Oil and Petrol:
Standard practice of the elites is to criticise others for what they themselves are doing. Let’s have the weekly VAT data from fuel filling stations. We can then see who has gained.
VAT data? What will that tell you except how much VAT input and VAT output was recorded and the balance paid to HMRC. VAT is an end-user tax. Who has gained? The Government! The losers? Non-Vat registered consumers, ie, most of us.
Fuel retailers operate on 2p to 3p net profit.
The real gouging is the amount of duty levied by the Treasury as a percentage of the base unit price. A Government that actually respects its citizens and businesses would set an upper limit such that it still gets the same fixed amount of a litre of fuel as it did before recent price hikes.
Rachel From Accounts never was any good at basic maths. She is profiteering from the effects of the Iran war, so her, and the wider government’s, default position of course is to blame someone else. She is as thick as a government minister ……… oh, errrr, hang on a minute, ……… sorry, she is one. (For the uninitiated, government ministers have consistently shown that they are far more stupid than the erstwhile proverbial Two Short Planks).
Apocryphal story explains “profiteering”.
During the great Covid lavatory roll crisis….
Women goes to buy lavatory rolls in supermarket A: they are £15 for six. She is outraged and summons the manager.
”£15 for 6 loo rolls, that’s disgusting,” she screams, “You are just profiteering. 6 rolls in supermarket B are only £3-50.
Manager, “Then go and buy them in supermarket B.”
Woman, “I can’t. They have none.”
Price carries infirmation about supply and demand and is the free market rationing mechanism – higher pricing reduces demand, most people get something. Choice: get some at a high price; get none at their usual price.
And apart from soaring energy costs, increased taxation to suppliers, monetary inflation caused by out of control Government spending and borrowing and money printing to cover it – complete mismanagement of the economy, zero economic growth – it’s the Iran crisis that is increasing prices.
I still haven’t worked out quite why so many went collectively mad and decided to express that madness on the purchase of industrial quantities of toilet rolls… there must be houses to this day whose lofts are fully insulated with them.
I suspect it is a matter of belief within the Labour mindset that large businesses are capitalists that exploit the poor. That small businesses (think White Van Man) avoid taxes, as do landlords and farmers. Therefore that can be easily blamed – without any evidence – for whatever ails the Government.
The Government are the gougers, they are making more money in taxes everytime the oil price increases, if they really wanted to help they would reduce the VAT and tax, but they don’t because they want to redistribute, and return us to Lockdown via telling us to not drive our cars, to work from home yada yada. Control.
This Government are grifters. Good on the CEO’s for calling them out.
Nothing like an oil crisis to hide deliberate theft by government and boy are this shower going to milk it. There might even be a possibility that the excuse “the last tory government wot did it” will be relegated to a supporting role while “it’s the war stupid ” does all the heavy lifting. Everything is covered:
Collapsing nhs, raging inflation, potholes, strikes, increases in mental illness, unemployment, increases in the illegals, failing postal system, trains not running on time, basically any failure can be blamed on the war. Sounds about right for this evil bunch of fakes.
I bet supermarkets and other petrol retailers are profiteering.
Obviously the price of crude oil has increased which means the wholesale price of petrol will increase, however these prices are for delivery at some point in the future. Petrol retailers probably sign contracts months in advance to have petrol delivered at an agreed price. Therefore the wholesale price of the petrol they’re currently selling hasn’t been affected by the Iran war and any increase in the price motorists pay is extra profit for retailers and extra VAT for the government.
I would argue that the government is the biggest profiteer of all.
Rising prices mean increased VAT receipts….
Put 40 quid in your tank and you are actually only putting in 18 quid. The government steals the other 22 quids worth, and yet they have the audacity to accuse others of profiteering. —–Even the Mafia would blush at this level of protection money.
Why don’t filling stations prominently display a (rough) breakdown of the price of fuel near the pump?
Although there are disadvantages, adopting the US practice of pricing items net of tax, then adding sales tax at the till would make the amount going to the government shockingly clear with each purchase.
E.g. 50 litres of petrol, £40 please madam, plus tax makes £115 altogether.
Cash or card?