Is Food Expensive?

[Si Hunt]

It's an interesting question. Food tends to be treated (by me at least) as an outgoing in a different dimension to everything else. A coat, for example, costing over £50 would be a once in a year purchase, much mulled over, yet I wouldn't bat an eyelid over spending that on food in any week of the year. Odd, isn't it?

Record high food prices are moving to the top of policymaker agendas, driven by fears it could stoke inflation, protectionism and unrest and dent consumer demand in key emerging economies.

The United Nations' food agency (FAO) said on Wednesday that food prices hit a record high last month, above 2008 levels when riots broke out in countries as far afield as Egypt, Cameroon and Haiti.

So is food expensive? Sometimes I do a shop and I look at what I've bought and think "that doesn't look very much for what I paid". On the other hand sometimes, like today, I bought apples, milk, bread, buns, a big lump of cheese, some sat sumas, two tins of baked beans and a banana all for a tenner, I think it's quite good value.

Is food good value?

Si.

[WhiteCrowNZ]

Hmmm - can anyone tell me ... how much does a 4 pint of milk / litre of petrol / loaf of bread costs in the UK these days. I'm just so out of touch!

Obviously one thing the UK has going for it is that it doesn't have tax on food (we get the equivalent of VAT on food in NZ). It also benefits from a kind of economy of scale - which due to the amount of volume of things being sold, often the cost is down.

For instance there are certain items like gala apples which originate from NZ and are overall slightly more expensive to buy in NZ than over in the UK. Which makes you think "hey that's not quite right surely". But there you go!

[Si Hunt]

Milk is about £1.80p for 4 pints of organic, bread is aprox. £1.15p a loaf unless you buy Value.

I don't buy Petrol very often anymore, but I think it's about £1.20 a litre, which is amazing when you consider we protested against it hitting the £1 barrier.

Si.

[MinaHarker]

Obviously one thing the UK has going for it is that it doesn't have tax on food (we get the equivalent of VAT on food in NZ).

Yes it does! The VAT rules for food are very complicated and caused more than 1 argument while I was an accountant...

[Lissa]

The question of whether food is expensive is going to mean something different in places like Egypt, Cameroon and Haiti than it does in countries like Britain. Rioting over the price of essentials like bread is different to having to switch to Tesco Faux-Co Pops instead of the Kellogg's originals.

In this country food costs more or less what you want to pay for it. There is such a spread of shops that virtually everyone can feed themselves (not necessarily healthily) if they shop in the right place. But the existence of 3-for-2 and BOGOF offers all around our supermarkets does suggest that those items discounted today were massively over priced yesterday.

[Jason Thompson]

But the existence of 3-for-2 and BOGOF offers all around our supermarkets does suggest that those items discounted today were massively over priced yesterday.

I quite agree. It really irritates me to find things in all these multi-buy offers rather than single items at lower prices. It irritates me that supermarkets don't just cut the price of individual items instead of getting you to buy muliples of them (especially when I was single, as many offers applied to things I couldn't reasonably use (or carry) before they went off on my own, so I had to fork out the extra for a single item), and it irritates me that the public at large are so easily conned into thinking the ability to buy two for the price of one is somehow better than having single items half price, even though they are the bloody same!

Generally I think the question of whether food is expensive depends on how much you want to pay for it and how good you expect it to be. I don't buy a number of economy goods because I think they are hugely inferior to the more expensive brands, but if I was totally strapped for cash I could fill my fridge and cupboards with stores' own brands and still eat reasonably well.

Then there is the question of how much effort you want to put in. In a lot of cases you pay for the time and effort of someone else preparing the food for you. Buying the raw ingredients and making your own pies, bolognese, curry etc. can work out cheaper (and nicer) than buying frozen prepared stuff.

[Dirk Gently]

I agree with you there Jason, except for...

Buying the raw ingredients and making your own pies, bolognese, curry etc. can work out cheaper (and nicer) than buying frozen prepared stuff.

Not being the chef of the house I can't comment for myself but I'm told that making Cottage Pie for instance is way more expensive than buying a ready made one, although I'm sure this is probably down to the quality of the ingredients as I'm sure what goes in ready made stuff is the left overs after they've used the last cheap bit in the more expensive range of goods.

But yes, home made is usually nicer.

[Si Hunt]

So there's no VAT on food is there?

Sent Simon to get some chicken from Sainsburys today - they do a "2 for £6" offer on the 400g packs. When he got there, the offer had changed to "3 for £10" - i.e more expensive plus you have to pay more. Coincidence this is around the same time VAT has gone up?

Si.

[WhiteCrowNZ]

Well New Labour won the 1996 off the fear the Tories would introduce VAT on food.

To which ... New Labour started to look into putting VAT on "some" foods.

I wonder if you get VAT on prepared sandwiches and hot food from the supermarket in much the same way as from Takeaways?

[Lissa]

I understand VAT only applies to "luxury" food. Hence the court battle over whether Jaffa cakes were cakes or biscuits because one has VAT and the other doesn't.

[WhiteCrowNZ]

The world population is on the rise - according to conservative estimated by the UN it could be 9 billion by 2100, or the more alarmist one, about 15 billion.

Sure an expanding population, but a finite limit on the resources to feed them. Demand for food will increase, but supply cannot hope to keep pace. Increased prices for just about everything seem inevitable.

Such a huge world population is a pretty scary concept - and the Beckhams of this world aren't helping either. China's idea of having one child per couple seems a good one, until you here how brutally it's enforced.

[Zbigniev Hamson]

Well it's getting on for 7 billion now, up from about 1.5 billion a century ago, so for it to only increase to 9 billion in the next 90 years is... optimistic at the very least. Unless they're factoring in the inevitable mass starvations and things.

[Jason Thompson]

I wonder if you get VAT on prepared sandwiches and hot food from the supermarket in much the same way as from Takeaways?

Check here to find out....

[Jason Thompson]

I understand VAT only applies to "luxury" food. Hence the court battle over whether Jaffa cakes were cakes or biscuits because one has VAT and the other doesn't.

That's pretty much it. The problem is that the definitions of what is luxury and 'standard' are pretty arbitrary. A marshmallow teacake is zero rated. Something that could be exactly the same as a teacake except for lacking a biscuit base is standard rated. It was teacakes that caused a big hoo-ha for M&S a few years ago when they priced them up with VAT included but then found out they were zero rated and refused to pay over the VAT they had collected from the customers as a result. HMRC were not terribly happy....

It's a very messy, very arbitrary system, and this is nowhere more aparent than when you read the list of what can be zero rated and standard rated and notice that several individually named products (such as Jaffa Cakes and Bourbon biscits) have to be listed because they are harder to categorise.

[WhiteCrowNZ]

I notice there's standard VAT on horses, as they're not recognised as meat - I'm surprised there's not a French version of the Sun going "zoot-a-lor, ze English swine thumb their nose at a French delicacy!".