Parents could save £300 a year on baby formula amid high prices, says watchdog

Regulators have proposed sweeping changes for the baby formula industry, after finding many brands cost more than the weekly value of people’s benefits, leading some parents to forgo food to buy the product.

The Competition and Markets Authority (CMA) said issues like high prices and branding in the industry are leading to “poor outcomes” for parents, who could be saving about £300 a year by switching to lower priced products.

Officials said the NHS could have its own non-brand baby formula, in a bid to help drive prices down.

It also said existing products should be provided in non-branded containers in hospitals to reduce brand influence while parents are in a “vulnerable” setting.

The CMA said packaging should clearly display nutritional information, while any claims that cannot easily be checked by parents should be banned.

It said this would make it easier for parents to pick between brands.

Regulators have previously pointed to prices surging by 25% over the past two years, while consumers have borne the brunt of rising factory costs.

The industry is dominated by just three companies – Danone, Kendal and Nestle, which make up about 90% of the market.

However, the CMA stopped short of recommending a price cap, which it had said it was looking into last year.

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”.

“This is despite NHS advice stating that all brands will meet your baby’s nutritional needs, regardless of brand or price.”

Sophie Livingstone, chief executive of Little Village, a baby bank service, said nearly one in 10 of the families her charity supports are “resorting to watering down formula to make each box last longer”.

“The cost of baby formula is simply too high and piling on the pressure when families are already juggling high housing, energy and food costs.

“We want two things to happen – that the cost of formula comes down and that the Government provides clear guidance that allows baby banks to safely supply formula to the families most in need.”