UK businesses have a responsibility to shoulder lower profits this winter to help families through a cost of living crisis, according to the boss of a supermarket chain.
Richard Walker said the cost of milk has rocketed by 50 per cent, while the price of other staples such as bread and eggs has also increased.
“It will get worse as well. I have cost prices currently on the table from big branded suppliers that we haven’t stomached yet as a business, let alone have to pass on to our customers,” the managing director told Radio 4’s Today show on Wednesday.
Asked whether he thought businesses had a responsibility to absorb some extra cost to help families, he said: “Yes, I think we have a responsibility.
"I think our competitors do as well. And they are working hard to keep their prices low as well.
“We don’t make money on milk. And there will be loss leaders we have to sell because our customers are simply reliant on it. That’s why we have held the price of all of our £1 lines and introduced a lot more as people really rely on these to help feed their families.”
He said businesses should be prepared to forgo profits.
“I think businesses accepting lower or no profits in our case is very important. We have 800,000 kids living in poverty who don’t qualify for free school meals,” said Mr Walker.
“The easiest way to reach them is through universal credit schemes, but also through businesses doing what they can. Because many of those children are kids of my Iceland customers.”
His comments came as figures show food inflation soared to 11.6 per cent in October as even basics such as tea bags and sugar all saw significant price rises.
Overall shop prices are now 6.6 per cent higher than they were this time last year - also a record - but food inflation jumped well above September's 10.6 per cent and the three-month average rate of 9.7 per cent, according to the British Retail Consortium (BRC)-Nielsen Shop Price Index.
Fresh food prices are now 13.3 per cent more than last October, up from 12.1 per cent in September.
Non-food inflation accelerated to 4.1 per cent, up from 3.3 per cent in September.
BRC chief executive Helen Dickinson said it has been a difficult month for consumers who not only faced an increase in their energy bills, but also a more expensive shopping basket.
"Prices were pushed up because of the significant input cost pressures faced by retailers due to rising commodity and energy prices and a tight labour market,” she said.
"While some supply chain costs are beginning to fall, this is more than offset by the cost of energy, meaning a difficult time ahead for retailers and households alike."
Mike Watkins, head of retailer and business insight at NielsenIQ, said: "External factors are keeping shop price inflation at record highs and the challenging economic conditions are significantly impacting consumer confidence and retail spend.
"With pressure growing on discretionary spend across both non-food and food retail, delivering good value is the table stake in the battle for shopper loyalty over the next eight weeks."
Which? head of food policy Sue Davies said: "Soaring food prices are a real concern, and our research shows millions of consumers are already skipping meals or struggling to put healthy meals on the table due to the cost-of-living crisis. It is vital that households get the support they need from the government and businesses.
"Supermarkets have a crucial role to play in helping their customers navigate the tough months ahead. Budget lines for healthy and affordable essential items need to be widely available across their stores and they should ensure shoppers can easily compare the price of products to get the best value. Promotions should be targeted at supporting those most in need."