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Today's News |
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| Greggs Parade Rained On In First 19 Weeks |
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 Wet weather, a fall in like-for-like sales, and the impending VAT on all heated bakery goods for sale in shops, are painting a sorry picture at Greggs at the moment, but motorway outlets and an Iceland tie-up brings in little rays of sunshine.
The total sales for the 19 weeks to 12 May 2012 were up 4.3%, driven by the
successful new shop opening programme and the development of new channels to
market. Like-for-like sales were down by 1.8%.
The trading environment for all retailers has remained extremely challenging, and
high street footfall has remained relatively weak. In addition, there was six
disappointing weeks of trading as a result of the exceptionally wet weather in April
and early May. Despite these tough trading conditions Greggs says they have continued to control costs tightly which has mitigated some of the impact of the bad weather.
During the first 19 weeks the company opened 25 new shops, making a net addition of 20 after five closures and giving a total of 1,591 shops.
The performance of the first motorway services shop in Cheshire remains
encouraging. The second shop in partnership with Moto Hospitality Limited is due to
open at Birch services on the M62 in June.
Following the successful roll-out of frozen Greggs-branded sausage rolls into Iceland
Foods, the range has been extended to include a further seven savoury lines and
one sweet line, which are now available in more than 750 Iceland stores. These
products, aimed at the ‘take home’ market, have been well received by Iceland
customers.
As a business famous for giving great value to our customers, Greggs have highlighted
the negative impact of the proposed VAT change during the period of consultation.
The strength of feeling amongst customers was clearly demonstrated with over
300,000 people signing a petition in objection to the tax.
Greggs support the Government’s aim of tax simplification, including clarification of the
definition of “hot takeaway food” and has always charged VAT on products in
this category, such as hot sandwiches, soup and hot drinks. What it cannot
support is the Government’s current proposal to extend the standard rate of VAT to
freshly baked food where there is no attempt to keep it hot and which is not designed
to be kept hot. The proposed changes are in the company’s opinion is unworkable and would give rise to many new anomalies.
It is feared the current proposal will have a disproportionate impact on the specialist bakery sector, resulting in further unemployment, high street closures and reduced investment. In its submission to the Government Greggs will also highlight the concern that the estimate of the extra VAT revenue generated makes insufficient allowance for the Income Tax, NI contributions and Corporate Tax that would be lost, as well as the cost of extra unemployment pay.
Greggs believe there is an alternative to the Government’s proposal which will remove
any anomalies and make the tax much simpler for both the Government and the
consumer. The solution is to see VAT charged on all food kept hot for
sale in a heated environment after cooking, all food re-heated to order and all food
supplied in heat-retaining packaging. This will very clearly differentiate between
fresh bakery food and food that is being sold intentionally hot.
Savoury sales are more than a third of Greggs turnover, and the outcome of the
consultation process could have a material impact on the company’s sales and profits. |
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| Item last updated: Wednesday May 16 2012 13:41 |
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| Parliamentary Committee Calls For Joined Up Strategy For Sustainable Food Including Obesity |
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The Government must develop a joined-up strategy to change the UK's unhealthy and environmentally damaging food system, as fears mount about global food security, MPs on the Commons Environmental Audit Committee warn.
The Environmental Audit Committee's Sustainable Food report recommends that:
* stricter advertising limits protect children from junk food marketing on all media including the internet
* food skills, such as cooking and gardening, should be part of the curriculum in all schools
* new national planning policy guidance for Local Authorities should ensure communities have access to healthy food and land to grow their own produce
* Government Buying Standards for food must be improved on meat and dairy and extended to cover hospitals, prisons and schools
* the Office of Fair Trading's remit should be amended so supermarkets are not blocked from cooperating on sustainability initiatives;
* Government should examine the scope for simple and consistent labelling on the sustainability of food products
Joan Walley MP, Chair of the Committee, said: "Our food system is failing. Obesity and diet related illness is on the increase, fewer young people are being taught how to cook or grow food, and advertisers are targeting kids with junk food ads on the internet.
"At the same time the world faces growing fears about food security as the global population increases, more people eat meat and dairy, and the climate destabilises as a result of forest destruction and fossil fuel use.
"The Government is understandably sceptical about anything that seems like nanny-statism, but the evidence is clear – intervention is needed to tackle obesity and fix our food system.
"In many cases, reducing environmental impacts and getting people to eat more healthily can be achieved in tandem."
The Committee report warns that the current Government has no overarching food strategy in place. Defra's 'Green Food Project' due to be published in June examines only part of the food system and the Government's focus on 'sustainable intensification' risks ignoring the wider social and health implications of how we grow, trade and consume food in the UK.
The challenge for the Government is to define what 'sustainable intensification' means in practice, and particularly for the UK. The MPs believe that sustainable intensification must be more than simply increasing yields: the emphasise should be on 'sustainable'. Policy must take account of social and environmental impacts of the food system, including retaining space for small scale production practices and local food networks. To put that into practice the Government needs a clearer and more cross-cutting strategy, according to the MPs.
The UK does not currently have the basic science base to deliver more sustainable food production practices, the report warns. Relying on markets to identify and to direct where the research is needed is likely to fail according to the cross party MPs. The Government must take a more active role in directing research to ensure we have the science base to deliver food security and sustainability. It must be prepared to intervene with universities, colleges and the Research Councils to develop incentives for them to train more agricultural and food scientists.
The Government has a vital role to play in advising consumers on the environmental and health benefits of eating well, by ensuring that they have clear and easily understood information. The Government should examine the scope for simple and consistent labelling on the sustainability of food products, perhaps through a weighting system to produce an overall score.
Good food skills should be part of the curriculum in all schools. The current review of the national curriculum provides an opportunity for Ministers to promote that. The Government should also consider stricter advertising limits, to extend the protection for children from junk food marketing on children's televisions to all media viewed by children, including the internet.
Planning policy often fails to recognise the importance of sustainable production and consumption of food, according to the report. Evidence suggests that access to land for food growing is vital for a sustainable local food system. The National Planning Policy Framework (NPPF) potentially provides local authorities with more powers to provide communities with better access to local food and to be able to grow their own food. The Government should make clear in the subsequent guidance it provides that for Local Plans to be consistent with the NPPF they should take account of communities' access to sustainable food and ensure that they are provided with alternatives to unhealthy food options. There should also be provisions in Local Plans to ensure that communities are provided with open spaces to grow their own produce.
The Committee received some evidence arguing that GM crops could be part of the solution for a sustainable food system, but also other evidence that food shortage problems could be better addressed through other means, for example by tackling the 30% of all food grown worldwide that is lost or wasted before and after it reaches the consumer. The MPs call on the Government to establish an independent body to research, evaluate and report on the potential impacts on the environment of GM crops, and their impacts on farming and on the global food system. An initial focus of such research should be on the scope for, and risks of, the co-existence of GM crops with conventional and organic farming regimes.
Joan Walley MP added: "Until there is clear public acceptance of GM and it is proven to be beneficial, the Government should not license its commercial use in the UK nor promote its use overseas."
Although it has been proven that public sector procurement standards – known as Government Buying Standards - can be adopted for minimal cost, voluntary measures to promote them have not achieved the necessary improvements across the sector. The Government Buying Standards for food should be extended to cover the wider public sector, to ensure healthy and sustainable food is made accessible to more people and to help establish new markets for producers. The MPs are urging the Government to raise the standards further, to reflect best practices in particular for eggs, dairy and meat.
The Groceries Code Adjudicator's role in delivering fairer prices to food producers will be vital in helping farmers and producers earn the means to invest in less impacting methods of production. The Government should amend the Office of Fair Trading (OFT) remit to take account of sustainable development while protecting competition, and task the OFT and the Competition & Markets Authority to investigate and clarify the scope for supermarkets to cooperate in developing shared sustainability good practice.
Obesity imposes a significant burden on the NHS - with the direct costs of as much as £4.2 billion a year and rising - according to research commissioned by the Department of Health.
England has one of the highest rates of obesity in Europe, with more than 60% of adults and a third of 10 and 11-year-olds overweight or obese
if no action is taken, over 50% of adults and 25% of children could be obese by 2050.
Poor diet could account for a third of all cases of cancer, and a further third of cases of cardiovascular disease
The doubling of obesity over the past 25 years has increased the risk of developing type II diabetes, cardiovascular disease and some types of cancer
Diet-related chronic disease costs the NHS £7 billion a year, including direct treatment costs, state benefits and loss of earnings
In addition to the health challenges, we also face an environmental challenge. The Foresight Report on the 'Future of Food and Farming' published last year set out the unprecedented pressures which the global food system will experience over the next 40 years.
Global population will increase from nearly seven billion today to eight billion by 2030 and probably to over 9 billion by 2050 agriculture will have to adapt to increasingly variable and unpredictable growing conditions as climate change gets worse there may be increased incidence of floods and droughts, increased temperatures, and different patterns in the occurrence of weeds, pest and diseases.
The Foresight report concluded that to feed a growing global population, the same amount of land will have to produce more food - 'sustainable intensification'.
The need to produce more from less is highlighted by the Government in the 'Green Food Project', in the Defra Business Plan and in the Natural Environment White Paper. Food waste - whether of water, energy, or food itself - remained the largest single issue across the whole supply chain. |
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| Item last updated: Wednesday May 16 2012 13:41 |
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| Fat Tax Needs To Be At Least 20% To Work Say BJM Experts |
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Taxes on unhealthy food and drinks would need to be at least 20% to have a significant effect on diet-related conditions such as obesity and heart disease, according to experts on bmj.com.
Ideally, this should be combined with subsidies on healthy foods such as fruit and vegetables, they add.
Their views come ahead of the 65th World Health Assembly taking place in Geneva on 21-26 May where prevention and control of non-communicable diseases will be a key issue for discussion.
As an increasing number of countries introduce taxes on unhealthy food and drinks, Oliver Mytton and colleagues at the University of Oxford examine the evidence on the health effects of food taxes.
Evidence suggests that taxing a wide range of unhealthy foods or nutrients is likely to result in greater health benefits than narrow taxes, they say, although the strongest evidence base is for tax on sugary drinks.
Meanwhile modelling studies predict a 20% tax on sugary drinks in the US would reduce obesity levels by 3.5%, and suggest that extending VAT (at 17.5%) to unhealthy foods in the UK could cut up to 2,700 heart disease deaths a year.
Opinion polls from the US also put support for tax on sugary drinks at between 37% and 72%, particularly when the health benefits of the tax are emphasised.
However, they point out that understanding the overall effect on health is complicated, and that policy makers need to be wary of negative effects, like changes in other important nutrients and compensatory behaviour that may increase energy intake or reduce energy expenditure.
The food industry also argues that the taxes would be ineffective, unfair, and damage the industry leading to job losses. And from a legislative point of view, it is still unclear how such taxes are best introduced and enforced.
Meanwhile, others have advocated that the taxes be used to raise funds to treat diet related diseases, subsidise healthy foods, or to stimulate industry reformulation of food (such as removal of salt, sugar, or saturated fats from foods).
In conclusion, Mytton and colleagues say that health related food taxes have the potential to improve health, but the tax would need to be at least 20% to have a significant effect on population health.
In a second analysis paper, Corinna Hawkes from the Centre for Food Policy at City University London says that, although governments are beginning to implement food policies to encourage healthier eating, "there remains a long way to go for food policies to reach their full potential."
She points out that changes to the food supply system since the 1980s have "coincided with rises in obesity and non-communicable diseases" and argues that health must be made a priority for the modern food economy.
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| Item last updated: Wednesday May 16 2012 13:41 |
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