Parents could save up to £540 by making one key change in supermarkets
Parents could save up to £540 a year by switching from premium baby milk formula to a basic brand.
In a report published by the Competition & Markets Authority (CMA) this morning, the regulator says parents are facing “poor outcomes” because of the way the baby milk market works. Often, parents feel guilty about using lower-priced brands because they think they are somehow “inferior”, even though lower formulas have the same nutritional value as the more expensive options, it said.
In its report, the CMA compared a range of different formula brands and found that the difference in prices over the first year of a baby’s life “has a sizeable financial impact on parents” – particularly after the surge in prices of the last few years.
The CMA said families could save £300 annually by switching to lower-priced brands, such as Little Steps, that offer the same nutritional benefits. This is compared to buying the current market leader, Aptimil. Buying Aptamil’s premium brand – Aptamil Advanced – rather than Little Steps would cost parents £540 more.
The CMA report found that many baby formula brands cost more than the weekly value of people’s benefits. This meant some parents cut back on food to cover the formula cost. It noted that baby milk brands often provide hospitals with formula below market cost, because once parents start using a certain brand, they tend to stick with it. To help drive costs down, the regulator says the NHS could have its own non-brand baby formula to provide to parents.
The regulator has also recommended that formula be packaged plainly in hospitals and that parents be allowed to buy baby milk in supermarkets using loyalty points and vouchers. However, it said restrictions on price promotions and discounts on formula should remain in place so mothers are not discouraged from breastfeeding.
Formula milk is tightly controlled by UK law, firstly in terms of nutrients and recipes but also in pricing. To prevent baby formula from being seen as superior to breast milk, itâs illegal in the UK to advertise it or for retailers to apply discounts or promotions to it. The NHS recommends mothers breastfeed exclusively for six to eight weeks after birth to allow their milk supply to become fully established. After that, the NHS recommends mothers who want to combi-feed replace one of their baby’s regular daily feeds with a bottle.
The CMA has previously reported a 25% increase in prices over the past two years, with just three companies – Nestle, Kendamil and Danone – controlling 90% of the market. Price caps – which has been suggested as a way of controlling the costs of baby formula – was not mentioned in the report.
The watchdog said that the lack of manufacturers within the sector meant there was no incentive to compete on prices, which meant any additional costs had been passed on “quickly” and in full to shoppers.
The report suggested that formula given to parents in hospitals should come in plain packaging to reduce brand influence while parents are in a “vulnerable” setting. It also recommended that formulas sold in shops should display all nutritional information and not carry claims that cannot be “easily” checked by parents. Finally, the CMA also said the UK should extend the ban on advertising to include follow-on formula.
Sarah Cardell, chief executive of the CMA, said many parents “pick a brand at a vulnerable moment, based on incomplete information, often believing that higher prices must mean better quality”. She added: “This is despite NHS advice stating that all brands will meet your baby’s nutritional needs, regardless of brand or price.”
Public health minister Ashley Dalton responded: “I welcome this report and would like to thank the Competition and Markets Authority for their thorough investigation.
“There are many benefits of breastfeeding but for those families that cannot or choose not to breastfeed, it is vital that they can access formula that is affordable and high quality. Families should not be paying over the odds to feed their babies because of outdated regulation. As part of our Plan for Change, we’re determined to ensure every child has the best start to life. We will carefully consider these recommendations and respond fully in due course.”
A spokesperson for Danone – which owns the Aptimol brand – said: “We agree that not currently being able to collect loyalty card points when purchasing infant formula – or use them to purchase infant formula – penalises parents unjustifiably. It will now be important for government to consider how to take forward the CMA’s recommendations and we look forward to engaging with all stakeholders to ensure parents in the UK are supported as much as possible.”
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