Supermarkets urged to limit food prices by government

UK supermarkets are being urged by the government to limit food prices in return for easing regulations, the BBC understands.

It is thought any price caps would be voluntary and apply to key groceries – such as eggs, bread, and milk - according to retail industry sources with knowledge of the plans.

In exchange, the Treasury may ease packaging policies and potentially delay rule changes around healthy food.

Supermarkets are understood to be strongly opposed to the plans. The Treasury has declined to comment.

The proposals, first reported by the Financial Times, come after the Scottish National Party (SNP) pledged to introduce a similar price cap in Scotland last month. However, its price cap would not be voluntary.

One retailer described the idea as "crazy" and the act of a "desperate" government.