The energy secretary, Grant Shapps, appears to have rowed back on plans for a law to force supermarkets to make fuel prices more transparent, instead backing a voluntary price comparison scheme in a meeting with supermarket bosses.
Shapps on Monday endorsed the non-mandatory scheme, which had been suggested by the competition regulator, after a summit with retailers that he had promised would involve him holding “rip-off retailers” to account.
The executives he met from Asda, Tesco, Morrisons and Sainsbury’s – as well as from the fuel providers BP, Shell and Esso – were under pressure to explain why they had failed to fully pass on savings to customers after a drop in their wholesale fuel costs.
In an article in the Sun at the weekend, Shapps wrote: “I will be telling them to do the right thing and immediately end any attempt to overcharge at the pumps … We will change the law so companies have to provide this price information whether they want to or not.”
In a statement after Monday’s meeting, he said: “Today’s commitment to a more transparent market is a step in the right direction – and I welcome their support for the Competition & Markets Authority’s (CMA) voluntary scheme, which aims to drive down prices and boost competition so customers can find the best deals locally. But I’m warning those who fail to put words into actions and continue to rip off motorists: you will be held to account.”
Earlier this month Shapps accused petrol retailers of using motorists as “cash cows” after the CMA found that some retailers had been making 6p more in profit per litre on fuel as they took advantage of reduced competition arising from the Covid crisis.
The energy minister said this translated to £75m a month in extra revenue for the four supermarket fuel retailers in 2022 alone.
The CMA proposed in response that retailers be required to provide live pricing data, allowing drivers to more easily shop around for the best deals.
Retailers said the watchdog provided an update at the meeting on a voluntary price comparison scheme that they supported.
A Sainsbury’s spokesperson said: “We welcome customers having greater visibility on fuel pricing. We consistently offer among the lowest fuel prices in every area that we operate.”
An Asda spokesperson said it would enable drivers to view local fuel prices at its forecourts on its website within the next few weeks and it would “continue to support the government as they develop the industry-wide fuel finder scheme”. It said: “Asda is the price leader in the fuel market and committed to helping motorists find the cheapest location to fill up.”
Petrol price rises have been blamed for putting further strain on households at a time when the government is struggling to curb inflation, which was at 8.7% in May, still well above the Bank of England’s 2% target.
The Bank of England governor, Andrew Bailey, said in June: “If you look at petrol prices, some sellers of petrol have possibly been charging too much for it.” He said alleged “greedflation” – whereby companies use high inflation as a cover to raise prices even further to increase profit margins – was “having very difficult effects” across the country.
