Premier Foods, one of the UK's largest food manufacturers, has been criticised for asking for payments from their suppliers in return for the chance to continue working with them.

The company, which owns brands including Oxo and Mr Kipling requested an “investment payment”, which demands suppliers across the country to hand over money or face losing business with the company.

One supplier said the practice known as pay and stay was like "blackmail".

It has been reported that the struggling company has received millions of pounds in total from its suppliers in this way so far.

Premier Foods said it was confident its "invest for growth" scheme did not break any rules under competition law.

The Federation of Small Businesses (FSB) said Premier “should be ashamed of themselves” and claimed that one small company had been asked to hand over £1,700 to secure the chance of future business.