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.
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‘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.
Amnesty International says it is “deeply concerning” that police made 474 arrests during a Palestine Action demonstration in London.
Metropolitan Police said 466 were detained under the Terrorism Act for showing support for a banned group.
Eight more people were arrested for other offences, including five for assaulting officers.
The Met said it was the most arrests it’s made related to a single operation in at least the past decade.
Pic: PA
Organiser of the event, Defend Our Juries, earlier said up to 700 people were at the event in Parliament Square and claimed police were preparing for the “largest mass arrest in their history”.
The group said those arrested included former Guantanamo Bay detainee Moazzam Begg, NHS workers, quakers and a blind wheelchair user.
Amnesty International UK’s chief executive Sacha Deshmukh said in a statement: “The protesters in Parliament Square were not inciting violence and it is entirely disproportionate to the point of absurdity to be treating them as terrorists.
“Instead of criminalising peaceful demonstrators, the government should be focusing on taking immediate and unequivocal action to put a stop to Israel’s genocide and ending any risk of UK complicity in it.”
The Met said a “significant number of people” at the event were seen “displaying placards expressing support for Palestine Action”.
Home Secretary Yvette Cooper said: “The right to protest is one we protect fiercely but this is very different from displaying support for this one specific and narrow, proscribed organisation.
“Palestine Action was proscribed based on strong security advice following serious attacks the group has committed, involving violence, significant injuries and extensive criminal damage.”
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Palestine Action supporters arrested at protest
Police said those arrested had been taken to processing points in Westminster and any whose details could be confirmed were bailed on condition they didn’t attend further Palestine Action support events.
Others whose details could not be verified, possibly because they refused to give them, were taken to custody suites across London.
Pic: PA
The protests have put a strain on authorities’ capacity to cope.
Sky News understands senior leaders in the prison service, known as “Capacity Gold”, met today to discuss how to deal with the large number of arrests as the male prison estate is close to full.
It’s understood 800 inmates were moved out of the busiest jails in and around London beforehand.
In a statement, the Metropolitan Police Federation said: “Thinking of our colleagues and wishing all assaulted officers well. Remember there are no ‘extra’ police officers – just the same ones having their days off cancelled, having to work longer shifts and being moved from other areas. Officers are emotionally and physically exhausted.”
Read more: What does proscribing a group mean?
Legislation to ban Palestine Action came into force on 5 July, making it a criminal offence to show support for the organisation, carrying a prison sentence of up to 14 years.
Defend Our Juries said earlier this week the protest would still go ahead, following several similar demonstrations since it was outlawed last month.
On Saturday, a spokesperson said: “Palestine Action and people holding cardboard signs present no danger to the public at large.”
Pic: PA
Human rights advocates Amnesty International described the arrests of so many people under UK terrorism law as “deeply concerning”.
Another march organised by the Palestine Coalition, which is a separate group, set off from Russell Square and assembled on Whitehall.
The Met Police said one person had been arrested there for showing a placard in support of Palestine Action.
Pic: Reuters
Earlier this week, three people charged as a result of illegal Palestine Action activity were named.
Jeremy Shippam, 71, of West Sussex, Judit Murray, also 71, of Surrey, and Fiona Maclean, 53, of Hackney in east London, will appear at Westminster Magistrates’ Court on 16 September.
The ban on Palestine Action faces a legal challenge in November after the High Court granted a full judicial review to Palestine Action co-founder Huda Ammori.
Foreign criminals will be deported from the UK immediately after they are sentenced, the justice secretary has said.
The law change proposed by Shabana Mahmood could save taxpayers an average of £54,000 a year per prison place.
The changes would apply to prisoners serving fixed-term “determinate” sentences.
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May: Inside one of Britain’s most overcrowded prisons
Authorities would also retain their power not to deport a criminal but instead keep them in custody – with examples including if an offender is planning further crimes against the UK’s interests or national security.
The justice secretary’s announcement goes further than a change to the law in June – expected to come into force in September – meaning prisoners face deportation 30% into their sentence rather than the current 50%.
The government will need parliament to greenlight its proposal to bring this down to 0%.
Foreign national offenders make up around 12% of the prison population.
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May: Male prison capacity running at 99%
Ms Mahmood said: “Our message is clear – if you abuse our hospitality and break our laws, we will send you packing.”
She added: “Deportations are up under this government, and with this new law they will happen earlier than ever before.”
Almost 5,200 foreign national offenders have been deported since July 2024, a 14% increase on the 12 months prior, according to the government.
Read more:
Inside one of Britain’s most overcrowded prisons
Prison system came ‘within days of collapse’
Prisoners to be moved to lower security jail
According to a Labour source, the previous Conservative government relied on prison transfer agreements with other countries to deport foreign national offenders, in deals which allow inmates to serve their custodial sentence in their “home” country.
This saw 945 prisoners sent to jails abroad between 2010 and 2023, equal to fewer than two criminals per week.
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July: Jenrick slams justice system shake-up
Conservative shadow justice secretary Robert Jenrick said: “In Starmer’s topsy-turvy world, investors are fleeing the country in their droves while record numbers of violent and sexual offenders from abroad are put up in our prisons. It’s a farce.
“Yet again Starmer has refused to confront our broken human rights laws.
“He needs to grow a backbone and change them so we can actually deport these individuals.
“The safety of the British public is infinitely more important than the ‘rights’ of sick foreign criminals.
“If countries won’t take back their nationals, Starmer should suspend visas and foreign aid. His soft-touch approach isn’t working.”
Police have made 200 arrests in London after crowds turned out for a Palestine Action demonstration – despite the group being banned.
Organisers Defend Our Juries said up to 700 people were at the event in Parliament Square and claimed police were preparing for the “largest mass arrest in their history”.
The group said those arrested included former Guantanamo Bay detainee Moazzam Begg, NHS workers, quakers and a blind wheelchair user.
The Metropolitan Police said a “significant number of people” were seen “displaying placards expressing support for Palestine Action, which is a proscribed group”.
“We have now made 200 arrests in Parliament Square this afternoon,” the force wrote in a post on X.
In an earlier post, it wrote: “While many of those remaining in the square are media and onlookers, there are still people holding placards supporting Palestine Action. Officers are steadily working through the crowd making further arrests.”
An aerial view of Parliament Square
Protesters write on placards for the Lift the Ban campaign rally on Saturday. Pic: PA
Read more
What does proscribing a group mean?
Legislation to proscribe Palestine Action came into force on 5 July, making it a criminal offence to show support for the organisation, carrying a prison sentence of up to 14 years.
Defend Our Juries announced the protest would go ahead earlier this week despite the ban, following several other similar demonstrations since the proscription last month.
On Saturday, a spokesperson for the group said that “Palestine Action and people holding cardboard signs present no danger to the public at large”.
A woman is dragged away by police officers after attending the Palestine Action protest in Parliament Square. Pic: PA
Three people have been charged as a result of illegal Palestine Action activity.
Jeremy Shippam, 71, of West Sussex, Judit Murray, also 71, of Surrey, and Fiona Maclean, 53, of Hackney in east London, will appear at Westminster Magistrates’ Court on 16 September.
Another march organised by the Palestine Coalition, which is a separate group, set off from Russell Square and assembled on Whitehall.
The Met Police said one person had been arrested there for showing a placard in support of the Palestine Action.
A man is detained by police officers in Parliament Square. Pic: PA
Crowds had assembled in Parliament Square by 1pm, with people seen writing “I oppose genocide, I support Palestine Action” on placards.
Many remained silent while others sang pro-Palestine chants.
A Home Office spokesperson said in a previous statement: “The Home Secretary has been clear that the proscription of Palestine Action is not about Palestine, nor does it affect the freedom to protest on Palestinian rights.
“It only applies to the specific and narrow organisation whose activities do not reflect or represent the thousands of people across the country who continue to exercise their fundamental rights to protest on different issues.”
The ban faces a legal challenge in November after the High Court granted a full judicial review to Palestine Action co-founder Huda Ammori.
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