There is "no buffer" for struggling families as the war in Ukraine causes food prices to soar, a leading supermarket boss warned on Tuesday.
The price of staples such as milk, butter and bread could increase by up to 50 per cent in the coming months as the food industry seeks to offset rising costs.
It comes as energy prices in the UK surge by 54 per cent this month - increasing the average household bill by about £700 per year.
Council tax bills and National Insurance contributions are also set to go up this week.
Iceland’s managing director Richard Walker said the cost of living crisis was the “single biggest issue” facing Britain.
“If you've only got £25 a week to spend on food then there is no buffer,” he told TalkRadio.
“There is no margin of error and therefore it is very concerning when you list some of the inflationary pressures that are resulting in cost price increases on staples like milk and bread.
“We see all around the country it is really starting to bite and I think this cost of living crisis combined with tax rises and fuel increases is the single biggest domestic issue facing our country. It's no exaggeration to say that.”
Supply chain challenges, increasing costs, and labour shortages have all played a part in food and drink price rises and industry chiefs have warned the impact of the war in Ukraine has only exacerbated the crisis.
Ukraine produces much of the world’s wheat, barley, sunflower and maize, while Russia is a major exporter of fertiliser.
The invasion has led to a dramatic decline in the number of crops planted by Ukrainian farmers, and sanctions restrict Western business importing goods from Russia. The latest figures show food inflation has risen by 5.3 per cent year-on-year – following several months of price hikes.
As animal feed, fertiliser and fuel costs soar, figures from the Office for National Statistics show 58 per cent of food and drink businesses reported passing on price rises to customers last month.
Chancellor Rishi Sunak has unveiled some measures to help ease the cost of living crisis for families, including a one off £150 council tax rebate for some households, a £200 loan to assist with energy bills, which comes in October, and a rise in the threshold for paying national insurance in July.
