John Swinney is playing a dangerous game with your dinner plate. The SNP’s flirtation with "maximum prices" for essential foods isn't just bad economics; it’s a recipe for empty shelves and a nutritional nosedive that Scotland cannot afford. We’ve seen this movie before. It ends in black markets, diminished quality, and the very people the government claims to protect being left with nothing but a cheaper price tag for an item that is out of stock.
Politicians love the optics of "capping" costs. It sounds empathetic. It looks like "doing something." In reality, it is a blunt instrument used by those who don’t understand—or choose to ignore—how global supply chains actually function. When you force a price below the market equilibrium, you don't magically make food more affordable. You simply ensure that nobody wants to sell it.
The Arithmetic of Abandoned Aisles
Let’s dismantle the "lazy consensus" that price controls curb inflation. Inflation is a monetary phenomenon; price controls are a supply-destruction mechanism. If it costs a producer £1.10 to farm, process, and transport a liter of milk, and the Scottish Government mandates that it must be sold for £1.00, that milk will not be sold in Scotland. It will be diverted to markets where the price reflects reality, or the farmer will simply stop producing it.
This isn't a theory. It is a mathematical certainty. I have spent decades watching supply chains buckle under the weight of "well-intentioned" interference. When the margin disappears, the product disappears.
The SNP’s fear that rising costs are affecting nutrition is valid. Their solution, however, is a hallucination. If you cap the price of high-quality proteins or fresh vegetables, retailers will prioritize stocking high-margin, ultra-processed "filler" foods that can still turn a profit under restrictive caps. You won't get cheaper broccoli; you’ll get a permanent shortage of broccoli and an abundance of subsidized, shelf-stable sludge.
The Quality Death Spiral
When you fix a price, you fix the quality at a ceiling and then watch it crumble. Manufacturers, unable to raise prices to meet rising input costs (energy, fertilizer, labor), have two choices: go bust or cut corners.
- Shrinkflation on Steroids: That "essential" loaf of bread gets smaller, airier, and less nutritious.
- Ingredient Substitution: Real butter is swapped for cheaper vegetable oils; high-grade grains are replaced with lower-quality fillers.
- The Luxury Pivot: Retailers stop stocking "essential" lines because they are loss-leaders and instead fill shelves with "premium" versions that aren't subject to the cap.
The result? The poorest families—the ones Swinney claims to be "fearing" for—are left choosing between a "price-capped" item that is never in stock and a "premium" item they truly cannot afford. The middle ground, where nutrition actually lives, is erased.
The Mirage of the Greedy Supermarket
The core of the SNP’s argument relies on the villainization of the "big grocer." It’s an easy sell. People see rising totals at the till and want someone to blame. But grocery remains one of the lowest-margin industries in the world. UK supermarkets typically operate on a net profit margin of $2%$ to $3%$.
$$\text{Net Profit Margin} = \left( \frac{\text{Net Income}}{\text{Revenue}} \right) \times 100$$
If you squeeze that margin via legislative fiat, you don't "redistribute" wealth from shareholders to the poor. You simply remove the incentive for the supermarket to operate in low-income areas where the cost of security, logistics, and "essential" stock management is higher. We call this the "food desert" effect. Price caps are the fastest way to turn a struggling neighborhood into a place where the only accessible "food" comes from a petrol station or a deep-fat fryer.
Better Data, Worse Solutions
The SNP points to the "cost of living crisis" as a justification for interventionism. But they ignore the underlying drivers. Scotland’s food inflation isn't happening in a vacuum. It’s driven by the $180%$ spike in fertilizer costs over recent years, soaring energy bills for greenhouse heating, and a labor shortage that has seen crops rot in fields.
Fixing the price at the supermarket checkout does nothing to lower the cost of nitrogen or diesel. It’s like trying to cure a fever by breaking the thermometer.
If the Scottish Government were serious about nutrition, they wouldn't be looking at price ceilings. They would be looking at:
- Targeted Nutritional Subsidies: Directly funding the purchase of fresh produce for low-income households through digital vouchers, ensuring the money can't be spent on ultra-processed goods.
- Supply Chain Resilience: Investing in vertical farming and cold-chain logistics to reduce the reliance on volatile imports.
- Deregulating Small-Scale Production: Making it easier for local producers to sell directly to consumers, bypassing the very supermarket "monopolies" they claim to hate.
The Black Market Reality
Every time a government caps the price of a necessity, a gray market emerges. If "Price-Capped Milk" is limited to two cartons per person and is constantly sold out, individuals with the time or means to hoard will do so, only to resell it at a premium to those who missed out.
I’ve seen this play out in various international markets. The "official" price looks great on a government press release. The "actual" price—the one you pay to the guy who knows when the delivery truck arrives—is double the market rate. By trying to mandate fairness, Swinney is actually creating a system that rewards the most unscrupulous actors in the economy.
Dismantling the "People Also Ask" Nonsense
"Don't price caps protect the vulnerable?"
No. They protect the fastest. In a price-capped environment, the person who can get to the store at 7:00 AM wins. The single mother working two jobs or the elderly person with limited mobility arrives to find empty shelves. Price is a signal. It tells the supply chain "we need more of this here." When you kill the signal, you kill the supply.
"Why can't we just cap the profits of the big supermarkets?"
We already do, through competition. If Tesco makes too much, Aldi and Lidl eat their lunch. The UK has some of the most competitive grocery pricing in the developed world. Capping profits further would lead to a massive withdrawal of capital. Investors will move their money to sectors where the government doesn't arbitrarily decide how much a business is allowed to earn. That means less investment in store upgrades, less investment in energy-efficient refrigeration, and ultimately, a worse experience for the shopper.
"But France did it, why can't we?"
The "French model" wasn't a hard cap. It was a negotiated agreement with suppliers and retailers to freeze prices on specific items for a limited time. Even then, it resulted in massive friction between the government and manufacturers like Unilever and Nestlé. It didn't "fix" inflation; it just delayed the inevitable price corrections, leading to sharper spikes later.
The Harsh Truth About Scottish Health
Scotland doesn't have a nutrition problem because food is too expensive; Scotland has a nutrition problem because the cheapest, most calorie-dense foods are also the most damaging. Price caps on "essentials" often include items like white bread, pasta, and low-grade dairy—staples that keep people full but don't keep them healthy.
By subsidizing the price of the status quo through caps, you are incentivizing the population to continue consuming a diet that fuels the nation's obesity and type 2 diabetes crises. If you want to change what Scotland eats, you have to make the right food cheaper through supply-side incentives, not make all food scarcer through price-side mandates.
Admit the Trade-off
If you support price caps, you are supporting shortages. You are supporting a decline in food quality. You are supporting the eventual closure of local grocers who cannot survive on government-mandated margins.
You cannot legislate away the laws of supply and demand. You can only distort them until the system breaks. Swinney's "fear" for Scottish nutrition is the preamble to a policy that will make the Scottish diet more monotonous, less accessible, and infinitely more fragile.
Stop looking for a "maximum price" and start looking for a way to increase the "maximum supply." Anything else is just political theater performed for a starving audience.
Don't wait for the government to fix the price of your milk. They’ll just end up making sure the bottle is empty when you reach for it.
