Plans are being made to limit the cost of essentials such as bread and milk – but the price cap won’t be enforceable (Picture: EPA)

A new plan encouraging supermarkets to introduce price caps on essential food will not be made compulsory, a cabinet minister has admitted.

Government proposals are being drawn up that would push retailers to limit the amount shoppers pay for basic items, such as bread and milk.

The idea behind the plans is to help with the cost of living crisis and would see major stores being asked to charge as little as possible for everyday household products.

It would allow supermarkets to choose which items they cap in an opt-in scheme, modelled on a similar agreement in place in France.

If introduced, it would mark the biggest intervention on pricing since controls brought in by Edward Heath in the 1970s.

But health secretary Steve Barclay has said the scheme would be entirely voluntary with ‘no element of compulsion’ and that the government would not be able to control the prices set.

A No 10 source said the proposal is still at ‘drawing board stage’.

Health secretary Steve Barclay admitted there is no ‘element of compulsion’ to the plans (Picture: Getty Images)

When asked about the proposals on BBC’s Sunday With Laura Kuenssberg programme, Mr Barclay said: ‘My understanding is the Government is working constructively with supermarkets as to how we address the very real concerns around food inflation and the cost of living, and doing so in a way that is also very mindful to the impact on suppliers.’

He acknowledged small family-run businesses would themselves be under ‘significant pressure’ and stressed that the plans were ‘not about any element of compulsion’.

It comes after chancellor Jeremy Hunt backed interest rate hikes – even if they risk plunging the UK into recession – in order to combat soaring inflation.

Shadow work and pensions secretary Jonathan Ashworth said the proposal is ‘extraordinary’.

Experts say expensive food is set to overtake energy bills as the ‘epicentre’ of the cost of living crisis (Picture: EPA)

He told Laura Kuenssberg: ‘Rishi Sunak is now like a sort of latter-day Edward Heath with price controls.

‘We’ve got an inflation problem and the reason why we’ve got such an inflation problem in this country is because of 13 years of failure where we’ve not invested in sustainable energy, we cut our gas storage and we’re not improving the labour supply.

‘We could take measures now to get inflation under control and to grow our economy but instead you’ve got Jeremy Hunt saying, “Oh we might need to go into a recession,” as if, you know, worklessness, unemployment, people losing their homes is a price worth paying.

‘The government could take action now to tame inflation.’

Although down from 10.1% in March, the Consumer Prices Index of inflation remains stubbornly high at 8.7% in April’s figure, while experts have warned that alarmingly expensive food is set to overtake energy bills as the ‘epicentre’ of the cost of living crisis.

Food prices are expected to keep rising, having already increased by 19.1% in the year to March, placing additional pressure on families.

Earlier this week, energy regulator Ofgem, announced a sharp drop in the energy price cap – which limits the amount energy companies can charge per unit of energy.

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Experts say expensive food is set to overtake energy bills as the ‘epicentre’ of the cost of living crisis.