The University has acknowledged that Brexit and a fall of the pound could be one cause of the rise in catering prices on campus. Food prices are rising at a higher level than inflation, an investigation by Nouse has discovered.
While producer price inflation has only risen 1.8 per cent for food prices in the year to July 2018, with food also being a smaller contribution to consumer price inflation (CPI) currently than it was in July 2017, according to the Office for National Statistics (ONS), food prices on campus have risen by an average of 3.83 per cent, using a measure of 16 commonly purchased catering items, provided to Nouse by University hospitality and catering.
For example, from 2017/18 to 2018/19 prices, a salad bar box has risen from £3.05 to £3.20, a 4.9 per cent increase, when an increase in line with the 1.8 per cent level of food inflation would mean that it should cost £3.10-£3.11. Likewise, a baguette has risen from £3.05 to £3.15, five pence more expensive than the level of inflation, while jacket potato with chilli has risen from £3.50 to £3.70, rather than an inflation level of £3.56. Of the 16 commonly purchased items, only one has fallen in price, with soup and a roll falling by 10p to £2.70, while a bottle water has stayed level at £1.25.
The rise above inflation over the past year follows a general rise in inflation between the academic year 2013/14 and present, which are the oldest figures which Nouse has obtained. While a 12oz tea has risen from £1.55 to £1.65 over the past year, a 6.45 per cent increase, it has also risen 27.9 per cent since 2013/14, while general CPI is only 11.31 per cent since 2013.
The rise in prices post the 2016 EU referendum has also been high, with the tea again rising 10p from 2015/16 to 2016/17, the year after the referendum, and a total of 17.86 per cent from 2015/16 to present. The University acknowledged to Nouse that Brexit has been one cause for the price increases, stating that “We are seeing increases in the food we are purchasing. There are perhaps many reasons for this, but the fall of the pound and the uncertainty of Brexit could be contributing factors.”
However they also point to sustainability as being a cause for the price increase, commenting that “With increasing demands on organisations to sell food in sustainable packaging, which costs three-times the amount of non-sustainable packaging, and an increase in the cost of food more generally, prices for some items will inevitably go up in order for us to service our Colleges to a high standard.”
While wages and transport costs have risen at a greater rate than food, at 3.1 per cent in 2018 according to the Bank of England and 15.9 per cent (producer price inflation) according to the ONS respectively, when asked whether these are contributing factors to prices increasing above inflation, the University responded that they did not.
The University also indicated that the wages of hospitality workers are rising: “Around 50 per cent of our lowest paid members of staff received a 4.4 per cent pay-rise this year and it is likely to continue for the next two years to reach the government target of circa £9.00 per hour by April 2020.” They refused however to confirm whether they intend to apply for the Living Wage Employer accreditation.