A government watchdog has suggested lifting the ban on baby milk price promotions to help parents avoid "overpaying" for formula.
The Competition and Markets Authority (CMA) highlighted the need for reforms in the baby milk market to alleviate the financial strain on parents struggling with rising costs.
In its interim report, the CMA proposed several changes, including the introduction of NHS-branded baby milk and the removal of branding from formula sold in hospitals. While the report stopped short of recommending direct price controls, it did indicate that they could be considered in the future, noting that parents have been bearing the brunt of rising prices for years.
Sarah Cardell, CMA chief executive, expressed concern that companies were not competing aggressively on price, leaving many parents, particularly those in vulnerable situations, to purchase more expensive products, assuming higher prices meant better quality.
The UK market for baby milk is dominated by just three companies—Danone (Aptamil, Cow & Gate), Nestlé (SMA), and Kendamil—who control over 90% of the sector. The report revealed that prices have risen between 18% and 36% over two years (December 2021 to December 2023), with parents potentially saving up to £500 in a baby’s first year by switching to cheaper brands.
Maxine Palmer from the parenting charity NCT criticized the industry's exploitation of new parents, noting that skyrocketing prices, combined with a lack of clear regulations, left parents caught between choosing the best product for their baby and managing the rising cost of living.
Under current regulations, promotions like discounts or loyalty points are banned for baby milk, similar to rules for tobacco and lottery tickets, to encourage breastfeeding, which the NHS recommends as healthier. However, the CMA argued that this ban stifles price competition, leading to higher costs for consumers.
The CMA recommended allowing companies to publicly promote price reductions, which it believes would foster competition. It also noted that manufacturers have not been absorbing rising production costs, passing them on to consumers instead.
Despite the restrictions, retailers like Asda and Iceland have challenged the rules, with Asda allowing loyalty points to be used for baby milk since January.
The CMA also raised concerns about the marketing language used by companies—such as terms like "advanced"—which it said could mislead parents into thinking certain products were superior, even though all baby formula meets basic nutritional standards. This, the CMA warned, could dilute public health messages about formula safety and nutrition.
Post a Comment