Restricting promotions of food and drink high in fat, sugar or salt: business and regulatory impact assessment - partial

3. Consultation

3.1 Within Government

Three governance groups were formed to allow for discussion of these policy proposals with government divisions and bodies, key non-government agencies and local authorities.

The Senior Governance Oversight Group met three times in 2022 to discuss proposals, with an earlier iteration of this group meeting in 2018/19. This group comprised membership from:

• Scottish Government Food and Drink
• Scottish Government Legal Directorate
• Scottish Government Health and Social Care Analysis
• Scottish Government Redress and Survivor Relations
• Food Standards Scotland
• Public Health Scotland

Following the decision to take a more efficient route to deliver policy aims the group was stood down in June 2023 and replaced with a programme of regular engagement with relevant representatives from the membership.

The Financial and Delivery Considerations Group was established to:

• Help inform estimates of potential resource and costing implications
• Facilitate engagement between Scottish Government, Food Standards Scotland, local government and enforcement professionals to support effective enforcement of the policy.

The Group met virtually 5 times during 2022 / 23 and most recently on 22 November 2023. In addition, business was transacted via email.

In addition to those represented through these formal groups, Scottish Government officials have had direct contact and discussion with the following divisions and agencies to inform the development of this policy:

• Scottish Government Children and Families
• Scottish Government Economy
• Scottish Government Wellbeing Economy
• Scottish Government Child Poverty and Social Justice
• Scottish Government Education
• UK Government – Department of Health and Social Care
• Welsh Government – Healthy and Active Branch

Evidence Groups

• A Research Advisory Group was established to consider the evidence base and provide critique and support in understanding the evidence around diet, weight and food promotions.
• A Monitoring and Review Project Group was established to explore and consider the feasibility of implementing a range of studies to enable monitoring and review of any HFSS promotions regulations laid. This includes consideration of studies to set a baseline against which to assess progress and impact.

Both groups bring together economic and analytical advisers across Public Health Scotland, Food Standards Scotland and Scottish Government with policy officials and additional input from academics.

3.2 Public Consultations

The Scottish Government has taken forward robust consultation on proposals to restrict the promotion of targeted HFSS food and drink. Public consultation has taken place in 2017, 2018 and 2022. Consultation responses have been central to further developing the policy and are summarised below.

2017

The consultation paper titled ‘A healthier future – action and ambitions on diet, activity, and healthy weight’^[19] was published in October 2017. In this consultation the Scottish Government sought views on proposal to take forward measures to restrict the promotion of HFSS food. An analysis of the consultation responses was published in April 2018.^[20] This consultation informed initial considerations of policy proposals.

The consultation received 362 responses comprising approximately equal numbers of responses from individuals (179) and organisations (183). Three-quarters (74%) of the organisational responses came from public health, public sector and third sector organisations. One-fifth (20%) came from private sector and business organisations. The remaining 6% included private sector weight management organisations and regulatory bodies. In addition, four organisations (the Scottish Youth Parliament, Young Scot, Food Standards Scotland and the Scottish Public Health Network) carried out separate engagement exercises. These sessions were carried out with specific groups of interest, e.g. young people, and as part of the wider consultation to the strategy.

Industry respondents generally opposed the proposals and expressed concern about their potential for negative impact on industry and consumer choice. In particular they (i) opposed restrictions on price promotions of products high in fat, sugar and salt, (ii) opposed any extension of the (UK-wide) restrictions on broadcast and non-broadcast advertising, (iii) saw significant practical complications and competitive disadvantages for industry if arrangements diverged from those in the rest of the UK, and (iv) thought the proposals would have negative impacts on food producers, retailers and consumers. This group wanted improved consumer education, rather than legislative action.

2018

A more detailed consultation paper was published in October 2018, titled ‘Reducing health harms of foods high in fat, sugar or salt’.^[21] The foods consulted on were HFSS that also have little to no nutritional benefit (“discretionary foods”^[22]). It was noted that the intention was to restrict promotion and marketing at any place where targeted foods are sold to the public in the course of business, including possibly online. Analysis of the consultation responses was published in September 2019.^[23]

Of the 726 responses analysed, 632 were from individuals (87%) and 94 were from organisations (13%) – comprising 55 (59%) from non-industry organisations (public sector, third sector and other) and 39 (41%) from industry organisations (manufacturers, industry representative bodies, retailers and Out of Home sector).

Across the consultation, distinct viewpoints emerged by respondent type. Many respondents from industry either disagreed with the approach or did not indicate a specific view but raised concerns and suggested alternative approaches.

In effect, support for the specific proposals, where they were restrictive, was low and, where they were not restrictive or allowed exemptions, was higher. Key concerns from industry organisation respondents included: (i) the potential negative impact on businesses generally and specifically on smaller and specialist businesses that may be disproportionately disadvantaged; (ii) concern about conflict with and the undermining of a number of existing approaches and requirements (such as reformulation), and (iii) a view that other approaches to better inform customers of the contents of HFSS foods and guide them towards healthier choices might be more effective than the proposed restrictions.

2022

In 2022 we consulted to inform further development and impact assessment of the policy to restrict HFSS promotions. This provided an opportunity to take account of developments since the 2018/19 consultation, including EU exit, COVID, the cost of living crisis and the introduction of equivalent promotions regulation in England. The consultation received 110 responses. Of these, 38 were from individuals (35%) and 72 were from organisations (65%). Organisation responses comprised of 41 (57%) from industry (industry representative bodies, manufacturers, retailers and out of home providers) and 31 (43%) from non-industry (public sector, third sector and ‘other’).

Consultation analysis was published on 30 May 2022^[24]. An overview of consultation responses is provided below:

Typically, industry responses in the most part mirrored and reinforced feedback to previous consultations:

• Industry respondents were supportive of some aspects of the approach but typically to a lesser degree than non-industry respondents. Generally, where support existed among industry respondents it related either to preferring alignment with the UK Government regulations for restrictions in England or to attaining fairness across businesses.
• There were some aspects of the approach that industry respondents disagreed with, typically due to a view that there is insufficient evidence to justify them, or that they would create disadvantages for certain types of businesses (such as smaller companies) or that they would not align with the approach being adopted in England.

Further consultation in 2024

In line with a statutory requirement to consult on the detail of changes to food law (Article 9 of the General Food Law Regulation (Regulation (EC) No 178/2002)) a further consultation on the detail of proposed regulations was published on 27 February 2024 and will run for 12 weeks until 21 May 2024. This partial BRIA has been published alongside the consultation to allow for comment on the business and regulatory impact of proposals for regulations.

3.3 Business

In line with the principles of the New Deal for Business, engagement has been ongoing and will continue with business throughout the development of this policy. Engagement has spanned manufacturers, retailers, wholesalers and has included individual as well as umbrella organisations, including Scottish Retail Consortium, Food and Drink Federation Scotland, Scottish Wholesale Association, Scotland Food and Drink, Scottish Grocers Federation, Association of Convenience Stores.

We are also engaging the independent Regulatory Review Group (RRG) as the main forum for the early identification and mitigation of implementation challenges associated with regulations. The RRG was reinstated in response to a key recommendation within the New Deal for Business Group Report.

An inclusive approach to engagement has been undertaken to ensure a wide range of views have been sought through the consultation process. This has included public consultation (as covered in section 3.2 above), roundtable events, BRIA survey and an open invitation to business to contact the policy team to discuss proposals on a one-to-one basis.

Roundtable sessions

In autumn 2022 sessions took place with members of the following industry representative groups, with attendance ranging from 8-15 businesses at each session:

• Scottish Retail Consortium (SRC): food retail including (but not limited to) representatives from SRC, Asda, Co-op, Marks and Spencer, Pret a Manger;
• Food and Drink Federation Scotland (FDFS): food manufacturers including (but not limited to) representatives from FDFS, Ferrero, Nestle, Suntory Beverage & Food Great Britain & Ireland, UK Potato Processor’s Association, Mondelez;
• Scottish Grocers Federation (SGF): convenience retail including (but not limited to) representatives from SGF, J W Filshill, EROS Retail, Lothian Stores, United Wholesale (Scotland) Ltd, Bestway, Scotmid, as well as participation from owner/operators of individual convenience stores.

The above sessions allowed for discussion on all aspects of the Scottish Government’s proposed approach for restricting promotion of HFSS as set out in the 2022 consultation document. A key theme from industry was that there should be as great a level of alignment with UK Government regulations for England as possible to minimise costs for business. In the main discussions reiterated and supported responses received to the consultation, as reflected in the consultation analysis summarised at Section 3.2 and published on 30 May 2023.

In addition to the above, the Minister for Public Health & Women’s Health and senior Scottish Government officials chaired a series of roundtable discussions in 2023. Building on previous engagement these events allowed for further focused discussion on areas of the policy which generated significant feedback from stakeholders, specifically meal deals, temporary price reduction and business exemptions. The events are detailed below:

• 16 November 2023 – Public Health Stakeholders including NCD Alliance Scotland, Cancer Research UK, Food Standards Scotland and Public Health Scotland.
• 04 December 2023 – Manufacturing, Wholesale and Industry Stakeholders including Scottish Wholesalers Association, Scotland Food and Drink and Food and Drink Federations Scotland.
• 08 December 2023 – Retail Stakeholders including SRC, SGF, Association of Convenience Stores (ACS).

The views of stakeholders in the three sets of roundtables have been considered in the development of the consultation document. Public Health Stakeholder views are summarised at Section 8. Business stakeholder views are summarised below:

Meal Deals

Business Stakeholders

• suggested The Good Food Nation initiative as a comprehensive strategy to follow instead of implementing restrictions.
• raised concern about the logistical challenges of targeting specific components within meal deals (i.e. targeting pre-packed foods), and the potential for increased cost to be passed on to the consumer.
• raised concern that restrictive measures could displace healthier options.
• suggested focusing on promoting healthier combinations within meal deals to address childhood obesity trends, rather than banning them outright.
• raised concerns around potential challenges in consistent implementation across industry, an unlevel playing field compared to the hospitality sector, and possible disadvantages for smaller businesses who are unable to provide the same value to customers.
• suggested that meal deals should be seen less as a cause of overconsumption but as being affordable and convenient while providing choices to consumers, including healthy options.
• argued that evening meal deals are often portion controlled, and are likely to be lower in calories than less healthy takeaways.

Temporary Price Reductions (TPRs)

Business Stakeholders

• emphasized the significance of TPRs for driving sales and supporting Scottish produce. There was a unanimous view that restricting TPRs would significantly impact businesses.
• raised concerns regarding increased costs for the consumer and potential differences in prices between Scotland and the UK.
• voiced the need for a clear understanding of affected categories and which version of the Nutrition Profiling Model (NPM) would be used as a guide.
• strongly opposed restrictions on TPRs, and argued they are important competitive tools that differentiate stores and provide value to customers, especially with recent inflation.
• TPRs are not solely aimed at promoting High Fat, Sugar, and Salt (HFSS) foods but are used across a range of goods and aid in managing stock, reducing waste, and responding to shifting consumer demands.
• TPRs are available UK-wide regardless of size or location. Restriction of these may disproportionately impact stores in rural communities and result in increased costs for consumers.
• implementing and enforcing restrictions on TPRs pose significant challenges due to their temporary nature and diverse product range.
• TPRs are often used to promote local, Scottish SMEs produce and support their competition with larger brands.
• raised concerns around how TPRs would be implemented and the scrutiny process for secondary legislation
• questioned the evidence base and the appropriateness of restricting TPRs during a cost of living crisis.

Business Exemptions

Business Stakeholders

• exempting smaller stores, especially in areas of multiple deprivation, could drive up health inequalities.
• raised questions about unsuccessful previous initiatives, emphasising the need for collaborative efforts and evidence-based decision-making.
• specialist stores, for example chocolatiers, should be permitted to sell chocolate (which would likely be subject to restriction) at front of store as it is the good they are in the market to sell.
• the definition of a convenience store differs to England’s. There was a call for the convenience store threshold to be increased from 2000sqft to 3000sqft.
• Symbol Groups are different to franchises due to their independent ownership, and should not be treated as a franchise for convenience stores. Noting the importance of distinguishing between types of businesses, such as symbol groups and franchises, and clearly defining micro and small businesses.
• any restrictions for small businesses should align with ongoing Scottish Government initiatives related to alcohol policies and deposit return schemes to ensure coherence across policies.
• guidance on restrictions needs to be timely, inclusive of business input, and avoid complexity in implementation, learning from previous delays in England's approach

A note of these focused roundtable sessions will be published in due course.

BRIA survey

In September 2022 a BRIA survey was issued to 50 businesses including business organisations who had expressed an interest in the proposals, either through engagement in roundtable sessions or in consultation response. A total of 10 responses were received, split by 5 industry representative body, 3 manufacturers and 2 retailers.

Business response to proposals has in the main remained consistent. A summary of responses to the BRIA survey is provided below:

• Alignment with the UK Government regulations would reduce the impact on business.
• The business impact of proposals would depend on the categories of products within the scope of the restrictions.
• Targeting less healthy meal deals was not supported by respondents with questions raised around the evidence base.
• TPRs were noted as the most utilised promotion used by respondents with some respondents considering that targeting TPRs would leave convenience stores at competitive disadvantages to larger stores. It was the view of respondents that TPRs are designed to offer and deliver value for customers purchases rather than to encourage volume purchase.
• In terms of location restrictions respondents reported that store re-design would be required in most stores to achieve compliance and optimise space. Significant costs to reformat stores was a reported concern for respondents.

Individual meetings

In response to the Scottish Government’s open invitation for individual meetings, one-to-one meetings on the potential impacts of HFSS proposals took place between Scottish Government officials and the following business organisations and businesses:

• Scottish Wholesale Association
• Association of Convenience Stores (ACS)
• Scotland Food and Drink
• Marks & Spencer
• Pepsi Co Ltd
• Mondelez
• Scottish Grocers Federation

Similar to the roundtable events detailed at Section 3.3, individual meetings allowed for discussion on all aspects of the Scottish Government’s proposed approach for restricting promotion of HFSS as set out in the 2022 consultation document. Across engagement with business at all levels was the preference for as great a level of alignment with UK Government regulations as possible to minimise costs for business. Businesses were keen to share learning from their experience with UK Government regulations including the importance of timely and clear guidance for industry to support implementation giving consideration to all businesses that would be within scope.