Don't panic buy, Britain tells consumers (updated)
23/09/2021 09:39
* Don't panic buy, British minister says
* UK not heading back to 1970s - minister says
* Supermarkets warn of panic buying
* Drax may keep coal plants operating
(Recasts headline and lead)
By Guy Faulconbridge, James Davey and Kate Holton
LONDON, Sept 23 (Reuters) - Consumers should not panic buy
products as Britain is not heading back into a 1970s-style
"winter of discontent" of strikes and power shortages, a junior
minister said on Thursday.
Soaring wholesale European natural gas prices have sent
shockwaves through energy, chemicals and steel producers, and
strained supply chains which were already creaking due a
shortage of labour and the tumult of Brexit.
After gas prices triggered a carbon dioxide shortage,
Britain was forced to extend emergency state support to avert a
shortage of poultry and meat.
Tesco TSCO.L , Britain's biggest supermarket group, told
government officials last week the shortage of truck drivers
would lead to panic-buying in the run-up to Christmas if action
was not taken.
Supermarket shelves of soft drinks were left empty in some
places and turkey producers have warned that families could be
left without their traditional turkey lunch at Christmas if the
carbon dioxide shortage continues.
"There is no need for people to go out and panic buy," Small
Business Minister Paul Scully told Times Radio.
"Look, this isn't a 1970s thing at all," he said when asked
if Britain was heading back into a winter of discontent - a
reference to the 1978-79 winter when inflation and industrial
action left the economy in chaos.
Supermarkets and farmers have called on Britain to ease
shortages of labour in key areas - particularly of truckers,
processing and picking - which have strained the food supply
chain.
LABOUR CRUNCH
The trucking industry needs another 90,000 drivers to meet
demand after Brexit made it harder for European workers to drive
in Britain and the pandemic prevented new workers from
qualifying.
"My business has about 100 HGV drivers short, and that is
making it increasingly very, very difficult to service our
shops," said Richard Walker, managing director at supermarket
Iceland, adding that deliveries were being cancelled.
"It is a concern and as we look to build stock as an
industry, to work towards our bumper time of year, Christmas,
we're now facing this shortage at the worst possible time. I am
worried."
The National Farmers' Union has written to Prime Minister
Boris Johnson asking him to urgently introduce a new visa system
to help tackle labour shortages across the supply chain.
COAL POWER?
The rise in natural gas prices is adding to the sense of
chaos. Six energy suppliers have gone out of business this
month, leaving nearly 1.5 million customers facing a rise in
bills.
Just over a month before Johnson hosts world leaders at a
United Nations climate conference, known as COP26, power
generator Drax Group Plc DRX.L said it could keep its
coal-fired power plants operating beyond their planned closure
next year. urn:newsml:reuters.com:*:nL4N2QP159
Britain is having talks with the energy regulator Ofgem
about whether or not a cap on gas and electricity prices for
consumers may have to go up, Scully said.
The cap was brought in to stop energy company gauging
consumers but has now turned their businesses unprofitable as it
is below the wholesale price, meaning consumers are being
subsidised by energy companies.
The price cap is due to rise 12% on Oct. 1 to 1,277 pounds
($1,740) for a household using an average amount of energy, and
would in normal circumstances be reviewed again in April 2022.
(Reporting by Guy Faulconbridge, Editing by Paul Sandle and
Angus MacSwan)
((guy.faulconbridge@thomsonreuters.com; 07825218698;))