Cost of living: Shoppers ‘overcharged’ for branded goods including baby formula and baked beans, watchdog finds
Suppliers of branded goods including baked beans and pet food have “pushed up prices by more than their costs”, according to the competition watchdog.
The Competition and Markets Authority (CMA) has been examining 10 product categories in a bid to see if shoppers, already struggling amid the continuing cost of living crisis, are being ripped off.
It said that while some increases were justified, to cover rising costs from elements such as energy and ingredients, there was clearly some profiteering – a finding the consumer group Which? described as “shocking”.
“The evidence collected by the CMA indicates that, over the last two years, around three-quarters of branded suppliers in products such as infant formula, baked beans, mayonnaise, and pet food – have increased their unit profitability and, in doing so, have contributed to higher food price inflation“, the regulator’s statement said.
It went on to explain, however, that the shifts were likely to have backfired somewhat as shoppers had clearly switched to cheaper, supermarket own brand, alternatives in a bid to save cash.
The regulator will hope that the competition will help prices of branded goods come down.
But brands told the inquiry that when their costs started to fall they would offer promotions to customers, rather than cut the standard costs of their products.
Please use Chrome browser for a more accessible video player
‘This cannot carry on’
The CMA said that more study was needed, including in the baby formula sphere that has been the subject of work by Sky News and seen the World Health Organisation declare that families were being “exploited”.
However, it did find evidence of unjustified price increases, with costs to consumers up by 25% over two years, and cited concern that two companies, Danone and Nestle, control 85% of the market.
Calls for baby formula price cap will rise
By laying out the simple fact that the formula milk price rises parents face in the shops do not equate with the “input costs” of making the product, the CMA is putting the formula industry firmly in the spotlight.
It’s already being called out as profiteering by campaigners, but the regulator is now singling out the formula industry for further interrogation.
It says quite clearly: “Evidence suggests that branded suppliers of baby formula have also increased their prices by more than their input costs.”
This year Sky News has tracked the desperate measures some families are having to take to feed their babies – it’s upsetting, stressful and ultimately unsafe for babies.
Experts have warned the high prices have put the nation on the brink of a “public health crisis” and earlier this month the World Health Organisation told Sky News that families were being “exploited” on pricing.
The CMA also highlights that the formula milk market is different to other food products – it is dominated by two multinational manufacturers – and that the public health messaging around it needs improvement for parents.
All the brands on the market meet minimum nutritional standards. Whether you buy the cheapest brand from Aldi for just under £10 or the most expensive at nearer £20.
The next stage of the CMA’s work will take months, but it appears determined to establish what needs to change. The calls for a price cap are only likely to increase.
A spokesperson for Danone UK & Ireland, the makers of the Cow & Gate and Aptamil brands, said it had minimised price increases and launched smaller, lower-priced pack sizes to help parents’ budgets.
“In Danone’s experience the formula milk market is competitive. We are committed to best practices to maintain this and will work constructively on ways we can continue to deliver value and innovation to parents. We will also continue to engage with the CMA over the coming months,” they said in a statement.
A Nestle spokesperson told Sky News: “Our goal has always been to keep products affordable and accessible for parents while still paying fair prices to our suppliers, including farmers.
“There have been significant increases in costs but we have been working to cut our costs wherever possible and only increase prices as a last resort.”
The CMA also declared that it was going to review supermarket loyalty schemes in the next phase of its investigation.
Front and centre of that is the offering of promotions only to customers who sign up to their loyalty cards.
The industry group for manufacturers responded to the CMA’s conclusions by suggesting that the pricing reflected value.
Karen Betts, chief executive of The Food and Drink Federation said: “Across our sector margins are at a 40-year low, insolvencies have doubled and investment has dropped by more than a third.
“Shoppers in the UK can take some comfort from the fact that, even with the levels of inflation we’ve seen in recent months, food and drink prices here remain lower than average EU grocery prices.
“The UK grocery market is highly competitive and offers a wide choice of products at a range of prices.
“Where branded products are more expensive than own-brand, this is because of the constant investment in quality and innovation that brand-owners make.
“If that investment doesn’t happen here in the UK, the amount of imported food and drink will certainly go up – with consequences for jobs, competitiveness and food security.”
But Sue Davies, head of food policy at Which?, said of the CMA’s findings: “Its evidence reinforces Which?’s concerns that shoppers relying on convenience store branches of the big supermarkets, which rarely stock the cheapest own-brand ranges, may struggle to find more affordable food.”
She added: “It’s positive that the CMA is set to review supermarket loyalty pricing as a recent Which? investigation found these deals aren’t always as they seem.
“In September we asked the regulator to look at whether supermarkets could be hiking ‘regular’ prices to make it appear that loyalty scheme customers are getting a better deal than they really are.”
The regulator issued its update after previously finding that higher prices in stores were not the result of weak competition between supermarket chains.
The watchdog did, however, demand tighter rules over so-called unit pricing – costs per item covering versions of the same product – to bolster price transparency.
It also previously found that supermarket fuel operators had charged motorists an extra £900m in 2022 by raising their margins on both petrol and diesel sales.
Four people have been charged after £7m of damage was caused to two Voyager aircraft at RAF Brize Norton.
The investigation into the incident early on Friday 20 June was led by counter-terror police.
They have been charged with conspiracy to enter a prohibited place knowingly for a purpose prejudicial to the safety or interests of the UK – and conspiracy to commit criminal damage.
Two Voyager aircraft at RAF Brize Norton were damaged. PA file pic
The four charged have been identified as:
• Amy Gardiner-Gibson, 29, of no fixed abode
• Daniel Jeronymides-Norie, 35, from London
• Jony Cink, 24, of no fixed abode
• Lewie Chiaramello, 22, from London
They will appear at Westminster Magistrates’ Court later today.
A 41-year-old woman arrested last week on suspicion of assisting an offender has been released on bail until 19 September.
Meanwhile, a 23-year-old man detained on Saturday was released without charge.
Last month’s incident at RAF Brize Norton in Oxfordshire was claimed by the activist group Palestine Action.
Yesterday, MPs voted to proscribe the group as a terrorist organisation.
The legislation passed with 385 MPs voting in favour, while 26 were against.
UK
No 10 backs Chancellor Rachel Reeves and says she ‘is going nowhere’ after tearful appearance in Commons
Rachel Reeves has not offered her resignation and is “going nowhere”, Downing Street has said, following her tearful appearance in the House of Commons.
A Number 10 spokesperson said the chancellor had the “full backing” of Sir Keir Starmer, despite Ms Reeves looking visibly upset during Prime Minister’s Questions.
Politics latest: ‘A moment of intense peril’ for PM
A spokesperson for the chancellor later clarified that Ms Reeves had been affected by a “personal matter” and would be working out of Downing Street this afternoon.
Politics latest: Reeves looks visibly upset in Commons
UK government bond prices fell by the most since October 2022, and the pound tumbled after Ms Reeves’s Commons appearance, while the yield on the 10-year government bond, or gilt, rose as much as 22 basis points at one point to around 4.68%.
Downing Street’s insistence came despite Sir Keir refusing to guarantee that Ms Reeves would stay as chancellor until the next election following the fallout from the government’s recent welfare U-turn.
Tory leader Kemi Badenoch branded the chancellor the “human shield” for the prime minister’s “incompetence” just hours after he was forced to perform a humiliating U-turn over his controversial welfare bill.
Speaking at Prime Minister’s Questions, Ms Badenoch said: “This man has forgotten that his welfare bill was there to plug a black hole created by the chancellor. Instead they’re creating new ones.”
Turning to the chancellor, the Tory leader added: “[She] is pointing at me – she looks absolutely miserable.
“Labour MPs are going on the record saying that the chancellor is toast, and the reality is that she is a human shield for his incompetence. In January, he said that she would be in post until the next election. Will she really?”
Not fully answering the question, the prime minister replied: “[Ms Badenoch] certainly won’t.
Please use Chrome browser for a more accessible video player
Welfare vote ‘a blow to the prime minister’
“I have to say, I’m always cheered up when she asks me questions or responds to a statement because she always makes a complete mess of it and shows just how unserious and irrelevant they are.”
Mrs Badenoch interjected: “How awful for the chancellor that he couldn’t confirm that she would stay in place.”
The prime minister’s watered-down Universal Credit and Personal Independent Payment Bill, aimed at saving £5bn, was backed by a majority of 75 in a tense vote on Tuesday evening.
A total of 49 Labour MPs voted against the bill – the largest rebellion in a prime minister’s first year in office since 47 MPs voted against Tony Blair’s Lone Parent benefit in 1997, according to Professor Phil Cowley from Queen Mary University.
After multiple concessions made due to threats of a Labour rebellion, many MPs questioned what they were voting for as the bill had been severely stripped down.
They ended up voting for only one part of the plan: a cut to Universal Credit (UC) sickness benefits for new claimants from £97 a week to £50 from 2026/7.
Ms Badenoch said the climbdown was proof that Sir Keir was “too weak to get anything done”.
Read more:
The PM faced down his party on welfare and lost
Labour welfare cuts ‘Dickensian’, says rebel MP
Ms Reeves has also borne a lot of the criticism over the handling of the vote, with some MPs believing that her strict approach to fiscal rules has meant she has approached the ballooning welfare bill from the standpoint of trying to make savings, rather than getting people into work.
Experts have now warned that the welfare U-turn, on top of reversing the cut to winter fuel, means that tax rises in the autumn are more likely – with Ms Reeves now needing to find £5bn to make up for the policy U-turns.
Asked by Ms Badenoch whether he could rule out further tax rises – something Labour promised it would not do on working people in its manifesto – Sir Keir said: “She knows that no prime minister or chancellor ever stands at the despatch box and writes budgets in the future.
“But she talks about growth, for 14 years we had stagnation, and that is what caused the problem.”
Prosecutors are considering whether to bring further criminal charges against Lucy Letby over the deaths of babies at two hospitals where she worked
The Crown Prosecution Service said it had received “a full file of evidence from Cheshire Constabulary asking us to consider further allegations in relation to deaths and non-fatal collapses of babies at the Countess of Chester Hospital and Liverpool Women’s Hospital”.
“We will now carefully consider the evidence to determine whether any further criminal charges should be brought,” it added.
“As always, we will make that decision independently, based on the evidence and in line with our legal test.”
Letby, 35, was found guilty of murdering seven children and attempting to murder seven more between June 2015 and June 2016 while working in the neonatal unit of the Countess of Chester Hospital and is currently serving 15 whole-life orders.
Letby worked at the Countess of Chester Hospital and Liverpool Women’s Hospital
She is understood to have carried out two work placements at Liverpool Women’s Hospital, where she trained as a student, between October and December 2012, and January and February 2015.
Police said in December that Letby was interviewed in prison as part of an investigation into more baby deaths and non-fatal collapses.
A Cheshire Constabulary spokesperson said: “We can confirm that Cheshire Constabulary has submitted a full file of evidence to the CPS for charging advice regarding the ongoing investigation into deaths and non-fatal collapses of babies at the neo-natal units of both the Countess of Chester Hospital and the Liverpool Women’s Hospital as part of Operation Hummingbird.”
Detectives previously said the investigation was looking into the full period of time that Letby worked as a nurse, covering the period from 2012 to 2016 and including a review of 4,000 admissions of babies.
Letby’s lawyer Mark McDonald said: “The evidence of the innocence of Lucy Letby is overwhelming,” adding: “We will cross every bridge when we get to it but if Lucy is charged I know we have a whole army of internationally renowned medical experts who will totally undermine the prosecution’s unfounded allegations.”
Please use Chrome browser for a more accessible video player
Three managers at the hospital where Lucy Letby worked have been arrested on suspicion of gross negligence manslaughter.
On Tuesday, it was confirmed that three managers at the Countess of Chester hospital had been arrested on suspicion of gross negligence manslaughter in a separate investigation.
Read more from Sky News:
‘Catastrophic failure’ that led to Heathrow power outage revealed
Man charged with murder of 93-year-old woman in Cornwall
Police said the suspects, who occupied senior positions at the hospital between 2015 and 2016, have all been bailed pending further inquiries.
There is also an investigation into corporate manslaughter at the hospital, which began in October 2023.
A public inquiry has also been examining the hospital’s response to concerns raised about Letby before her arrest.
In May, it was announced the inquiry’s final report into how the former nurse was able to commit her crimes will now be published early next year.
Earlier this year, Letby’s lawyers called for the suspension of the inquiry, claiming there was “overwhelming and compelling evidence” that her convictions were unsafe.
In February, an international panel of neonatologists and paediatric specialists told reporters that poor medical care and natural causes were the reasons for the collapses and deaths.
Their evidence has been passed to the Criminal Cases Review Commission (CCRC), which investigates potential miscarriages of justice, and Letby’s legal team hopes her case will be referred back to the Court of Appeal.
-
Sports3 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports1 year agoStory injured on diving stop, exits Red Sox game
-
Sports2 years agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports4 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Sports2 years agoButton battles heat exhaustion in NASCAR debut
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike