MPs didn't hold back when confronting executives on profits and obscene salaries

Supermarket bosses faced a grilling yesterday by MPs over questions of profiteering and high food prices during a cost of living crisis.

MPs didn’t hold back as they laid into the executives representing four of Britain’s biggest supermarkets Tesco, Sainsbury’s, Asda and Morrisons.

Bosses left answerless when confronted by CEO’s giant pay cheque

Andy McDonald MP left his audience squirming for an answer after confronting the supermarket executives over obscene CEO pay packages.

Using the annual report from Sainsbury’s as an example, McDonald highlighted the nearly £4 million in bonuses their chief executive Mr Roberts was paid on top of his salary last year.

He broke Mr Robert’s £4.9 million salary down for them, to £408,000 a month, £94,000 a week, £2,298 an hour before comparing that to Sainsbury’s workers who are paid £11 an hour.

“How is that justifiable when the people who work for you and the people who come into stores are suffering from a grotesque cost of living crisis now?” McDonald asked.

To which Rhian Bartlett, food commercial director at Sainsbury’s, attempted an answer: “They’re set by the Remco, I don’t have any remit over setting any of those salaries so I can’t really comment any further on that today.”

“Do you not understand how that sits with the general public?” questioned McDonald.

“That these sorts of wages are being paid and you tell us that your purpose it to provide the most reasonable priced food for your customers and yet dividends is paid out and these salaries are at this level?

“Does that not chime with any of you? No, that’s just utterly staggering quite frankly.”

As his further questions were met with stone silence.

Darren Jones pushes Tesco director on rising profits during cost of living crisis

Laying bare the facts, Labour MP Darren Jones pushed Tesco on their significant profit increase over the cost of living crisis.

During the committee investigation, the supermarket bosses denied profiteering despite having evidence of increased takings perfectly put to them by Jones who led the hearing.

Asda’s representative said their profits were actually down by 25% when adjusted, whilst Tesco had made 7% less profit than the last financial year according to its director Gordon Gaya.

Jones compared Tesco profits before and after the pandemic.

“In your 2018/19 accounts you made a profit of £1.6 billion, and in your 2021/22 accounts you made a profit of £2.03 billion. So just as a very basic review of your accounts, you’ve increased your profit quite significantly haven’t you?”

Gordon Gaya said Tesco’s profitability had hovered between 2-3% in the last four years and that profits year on year for the group business were down.  

However Jones pressed that the numbers he had just presented show the group profits had gone up from before the pandemic to now, ‘that’s a bigger number, essentially you’ve got more cash in the bank at the end of the day’.

He summed up: “Why is it, given the covid pandemic, the energy crisis, the increased cost to your customers, how can it be possible that you’re making hundreds of millions in additional profits?”

Supermarkets reject call for price caps on essential food items

Labour MP Ian Byrne thoroughly pressed the key figures being grilled over the accessibly of essential food items such as baby formula.

He said the images of baby formula milk locked on supermarket shelves haunts him, and asked the executives if they, like their counterparts in France, would support price caps on essential items.

Gordon Gafa of Tesco, the first to answer argued you can’t compare France to the UK, to which Byrne said ‘you can when you have locks on baby formula’ and demanded a yes and no answer.

The resounding majority answered a hesitant no. David Potts of Morrsions responded: ‘Competition leads you to the right place. The industry requires volume and you’ll see it come.’

Morrisons admits supermarket chains petrol profits have increased

The boss of Morrisons admitted to the committee that supermarkets have had increased profits at the petrol pumps, saying, ‘I think there is more profit at the retail end of fuel.’

Due to energy, labour and transport costs the ‘barrel price’ of oil had been forced up, the boss David Potts said, however admitted, ‘we can do more’.

Other supermarkets said they were waiting on a report on fuel pricing by supermarkets, which was commissioned after a competition watchdog found evidence that retailers had increased fuel prices to unnecessary high levels during a cost of living crisis.

During the meeting, MPs said the report indicated supermarkets’ profit margins have doubled to 8% on fuel over the last five years.

Hannah Davenport is trade union reporter at Left Foot Forward

Left Foot Forward’s trade union reporting is supported by the Barry Amiel and Norman Melburn Trust

Comments are closed.