Chancellor Rishi Sunak’s £15bn cost-of-living support package is only a “drop in the ocean” and not enough to help struggling households, according to retail veteran Lord Stuart Rose, the chairman of supermarket chain Asda.
Although he welcomed the handout, Rose said: “There is still going to be continuing pressure and a lot of toughness for people.”
Sunak yesterday announced a raft of support packages totalling £15bn to help households cope with high inflation and soaring energy prices, including a £400 grant to all households for energy bills.
READ: Rishi Sunak to pay for £15bn cost of living package with 'windfall tax'
Rose, who previously headed Marks & Spencer, Argos and Topshop, said inflationary pressures are set to last into next year and then take some time to gradually diminish.
“This is not going to suddenly stop,” he said. “I can remember the last time inflation was [like this] and it took nearly eight years to get under control. I’m not saying it is going to take eight years but it is not going to stop in a year.”
He said the priority should be “trying to get help to those who need it most”.
“You can give me £400 but I don’t need that off my electric bill. It is hard to focus but you need to dig harder for those people who are more disadvantaged,” he said.
Asda, which is the UK's third-largest supermarket group, said its like-for-like sales dropped 9.2% in the first quarter to end-March 2022, against strong comparables last year, when the country was in lockdown.
Food sales fell 7%, while clothing sales were down 19.3% and general merchandise sales declined by 23.7%.
"Households were squeezed by the removal of Ofgem’s price cap, resulting in gas price inflation of 95% and electricity prices rising by 53% in April,” the group said.
It said its Income Tracker showed that household disposable income fell to an average of £205 per week – the lowest figure since October 2018 - due to the sharp rise in living costs.