Britain will give the Competition and Markets Authority stronger powers to tackle companies deemed to have unfairly raised prices during crises, Chancellor Rachel Reeves said on Wednesday, as the government faces mounting pressure over rising household costs linked to higher energy and food prices.

According to Reuters, the new “anti-profiteering” framework would allow regulators to intervene more quickly during supply shocks, scrutinise company margins and publicly identify firms judged to have increased profits excessively during crises. Ministers would also gain temporary powers to order companies to halt exploitative pricing and impose penalties in serious cases.

Reeves said: “When global events drive up costs, working families feel it first.” She added: “I will not tolerate anyone exploiting a crisis to make a quick buck.” The measures follow warnings earlier this year from Prime Minister Keir Starmer that the CMA needed “further teeth” after energy prices surged following the conflict involving the US, Israel and Iran.

Reuters and the BBC reported that the Treasury has separately discussed voluntary price caps on basic supermarket goods including bread, milk and eggs with major retailers, although ministers ruled out mandatory controls. Treasury minister Dan Tomlinson told BBC Radio that “we are not going to be implementing a mandatory price cap”.

Industry groups and retail executives criticised the proposal for voluntary caps. British Retail Consortium chief executive Helen Dickinson said: “Rather than introduce 1970s-style price controls and trying to force retailers to sell goods at a loss, the government must focus on how it will reduce the public policy costs which are pushing up food prices in the first place.”

The BBC reported that former Marks & Spencer chairman Lord Rose described the idea as “the stuff of nonsense”, while former Sainsbury's chief executive Justin King told Sky News that price controls could amount to illegal collusion under UK competition law.

Food inflation reached 3.8 per cent in the four weeks to April 19, according to Worldpanel by Numerator, while the Bank of England said businesses expected food price inflation to rise to between 6 per cent and 7 per cent later this year. Shares in Tesco and Sainsbury’s fell on Wednesday following reports of the government discussions.

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