Restricting promotions of food and drink high in fat, sugar or salt: consultation

Section 2. Price promotions

Summary of our proposals

We propose to restrict the following types of price promotions on targeted foods^[23]:

Multi-buys of pre-packed foods, including:

• "X for Y", (e.g. "buy one get one free", "extra free", and "3 for 2" offers)
• "Y for £X" (e.g. "3 for £2", meal deals);

Unlimited refills for a fixed charge on soft drinks with added sugar that are HFSS or "less healthy" (as defined by the NPM), whether pre-packed or non-pre-packed.

Types of price promotion

75. Price promotions refer to special offers where there is a reduction in the usual price of a product. These may be time-limited or conditional on some other requirement, such as purchasing another item(s). It does not include other marketing and promotional strategies such as product placement or advertising.

76. Price promotions can take a number of different forms. Within this consultation, price promotions being considered are:

• multi-buys - where purchase of multiple items is cheaper than purchase of each individual item alone. (This includes for example buy one get one free, 3 for £2, 3 for 2 offers, extra free and meal deals.)
• unlimited amounts for a fixed charge^[24] - for example free refills
• temporary price reductions (TPRs) - a temporary reduction in the cost of a product, e.g. 10% off.

77. In 2020, around 27% of the food and drink we bought from shops including supermarkets was on price promotion: breaking this down, most (19%) calories were purchased through retail TPRs, 5.6% from "Y for £X" e.g. 3 for £1 and other multi-buys e.g. buy one get one free^[25] and 2.7% from other forms of price promotion. Discretionary foods are also more frequently purchased using "Y for £X" promotions than some healthier categories such as fruit, vegetables or bread. For example, in 2020, 7.4% of confectionery was purchased on "Y for £X" compared to just 4% of fruit. In 2020, in Scotland, in the out of home sector, around 9% of visits included a price promotion, the majority (6.4% of visits) being multi-buys including meal deals^[26]. In the last eight years, there have been a decline in the proportion of calories purchased on promotion in the retail environment^[27],[28].

78. Multi-buys are particularly effective at increasing the overall volume of promoted product purchased. Data from around 30,000 British households between 2013 and 2015 showed, for example, an estimated volume uplift for multi-buys of 25%. In comparison, TPRs were shown to drive volume uplift by 17%.^[29] Given all these types of promotions encourage an increase in the amount of product purchased, they can encourage increased consumption. Restricting these types of promotions presents an opportunity to reduce the purchase of HFSS foods and supports our aim to improve dietary health through a reduction in the excess consumption of calories, fats, sugar and salt.

79. Unlimited offers, such as free refills on soft drinks, operate on much the same basis as multi-buys – where unlimited amounts are offered for a fixed charge. There is evidence to suggest that consumers seek to get their "money's worth" leading to an increase in consumption and this can be affected by the price charged.

UK Government regulations for England

80. Since we last consulted, the UK Government has set out in regulations the types of promotions that will be subject to restrictions in England. In respect of price promotions, the English regulations will restrict:

• volume based price promotions such as such as "buy one get one free" or "3 for 2" offers on pre-packed targeted foods;

• free refills of non-pre-packed drinks that are HFSS or "less healthy" (as defined by the NPM)

81. Meal deal promotions are not within scope of the regulations in England. This is on the basis that meal deals are generally targeted as lunch options for adults to consume on the go that day rather than being stockpiled at home; and they aim to reduce the cost of a single meal.

Welsh Government consultation

82. In its consultation, Welsh Government is seeking views on proposals to restrict temporary price restrictions, multi-buy offers and volume offers. Welsh Government include 'meal deals' in their volume offers.

Our proposals

83. Feedback to our previous consultation indicated that respondents from non-industry organisations were largely in favour of the proposals to restrict multi-buys and unlimited amounts for a fixed charge. Industry organisations views were mixed or provided no specific view. Individual responses also were mixed.

84. Taking this feedback into account, and in view of the enhanced impact of multi-buy promotions compared to other types of price promotions, we propose to target the following:

Multi-buys of pre-packed foods, including:

• "X for Y", (e.g. "buy one get one free", "extra free", and "3 for 2" offers)
• "Y for £X" (e.g. "3 for £2", meal deals);

Unlimited refills for a fixed charge on soft drinks with added sugar that are HFSS or "less healthy" (as defined by the NPM), whether pre-packed or non- pre-packed.

Multi-buys

85. We propose to restrict multi-buys on targeted foods which are pre-packed and are HFSS or 'less healthy' (as defined by the NPM). In addition to buy one get one free and 3 for 2 offers, we propose that "extra free" would be within scope of restrictions based on the understanding that the promotion operates on a similar basis to "buy one get one free" – where the promotion indicates that an item or part thereof is free.

86. We received very little feedback in our previous consultation on our proposal to include meal deals as part of our proposed restrictions. We propose that meal deals would be within scope of restrictions because they are a form of "Y for £X" and could encourage consumers to purchase more in order to obtain a discount, as set out earlier. We propose that if one or more components of a meal deal were a targeted food that was HFSS or 'less healthy' (as defined by the NPM) then the products could not be sold at less than the sum of their individual prices. Meal deals that do not contain targeted foods (or contain targeted foods that pass the NPM) would not be subject to the restrictions. This would provide the opportunity for consumers to take advantage of meal deals that are healthier and would support our aim to improve dietary health and encourage healthier choices.

Unlimited refills for a fixed charge

87. We propose to restrict the sale of unlimited refills on soft drinks with added sugar for a fixed charge on the basis that this type of promotion is essentially a flexible form of "buy one get x free" multi-buy offer. We propose that the restriction would apply to soft drinks with added sugar that are HFSS or 'less healthy' (as defined by the NPM), whether pre-packed or non-pre-packed. This is on the basis that these drinks alone contribute around 20% to the average intake of free sugars in Scotland and, as set out in section 1 of this consultation, reducing consumption would be of benefit to dietary health and would further support progress towards our Scottish Dietary Goals with respect to intake of free sugars.

Other price promotions - temporary price reductions (TPRs)

88. TPRs are short term reductions in the price of food and drink products. Most retailers will run such offers on specific items for a typical duration of 2-4 weeks before reverting back to the full price.

89. In our previous consultation, we did not propose to restrict TPRs specifically. Feedback found industry respondents mostly in favour of the proposal. Non-industry respondents had mixed views, with similar proportions agreeing, disagreeing or not offering a view. Individuals typically agreed with the proposal not to restrict TPRs.

90. However, the scale of the diet and obesity challenge we currently face alongside our aim to halve childhood obesity by 2030 has led us to consider the inclusion of other forms of price promotions within scope of this policy, such as TPRs. Further as we are no longer pursuing promotion of value restrictions (see paragraphs 113-114) we want to take this opportunity to explore views on restricting TPRs specifically.

91. Since 2014, the overall balance of different types of price promotions has not changed. Food purchases have consistently been greater on TPRs than for other price promotion types. As set out earlier, in 2020, 19% of the food and drink purchased through retail was on TPRs.

92. Economic modelling indicates that a policy to restrict all price promotions (i.e., TPRs, multi-buy, "Y for £X" and other promotions) of discretionary foods (including ice cream and dairy desserts) could potentially lead to a reduction of 613 calories per person each week compared to a reduction of 155 calories per person for restricting multi-buy^[30] promotions only. Further, whilst multi-buys may generate the greatest sales increase when compared to TPRs, the latter still significantly expands sales.

93. Given the prevalence of TPRs, the data does suggest that restricting TPRs, in addition to multi-buys, could enhance the positive impact of the policy on dietary health. This would in turn support our aim to reduce the health harms associated with the excess consumption of calories, fats, sugars and salt. We are therefore seeking views on including TPRs within the scope of this policy. We recognise that there may be some challenges in targeting TPRs, such as what would be considered "temporary", but we would suggest that these are not insurmountable. We also recognise that this approach would diverge with that being taken in England, where TPRs will not be subject to restriction.

Defining price promotions

94. Further work informed by this consultation will be required to develop more detailed definitions. In doing so, we will seek expert advice and explore the opportunities to be consistent with the definitions set out in the UK Government regulations, where appropriate, whilst also considering to what extent consistency across the UK would support the implementation and delivery of the policy in Scotland. Whilst consistency may be helpful in terms of implementation, doing so could reduce the scope, and in turn, the impact of the policy on dietary health in Scotland. These are key considerations and we will consult again on detailed definitions before we implement the policy.

Questions

Question 4 - What are your views on the proposal to include the following within the scope of multi-buy restrictions?

Extra free: Agree/Disagree/Don't know

Meal deals: Agree/Disagree/Don't know

Please explain your answer

Question 5 - What are your views on the proposal to restrict unlimited refills for a fixed charge on targeted soft drinks with added sugar?

Agree/ Disagree/ Don't know

Other – please specify

Please explain your answer

Question 6 - Should other targeted foods be included in restrictions on unlimited amounts for a fixed charge?

Yes/ No/ Don't know

Please explain your answer

Question 7 - What are your views on the proposal to restrict temporary price reductions (TPRs)?

Agree/ Disagree/ Don't know

Other – please specify

Please explain your answer

Question 8 - Are there any other forms of price promotion that should be within scope of this policy?

Yes/ No/ Don't know

Please explain your answer