How pulling out of a long-planned new infant formula standard left the government with an expensive problem

Creating a stand alone infant formula food standard for New Zealand would be "complex", "costly" and "require significant resources", the government was warned.

The warning was issued to Cabinet ministers by Food Safety Minister Andrew Hoggard as the government considered opting out of tougher trans-Tasman baby formula rules last year. It is revealed in a newly released Cabinet paper from Hoggard.

Despite the warning, Cabinet decided to opt out anyway, and Hoggard announced New Zealand would create its own standard.

But since then, the government has been looking at how it could opt back in with Australia if exemptions to the labelling issues opposed by industry could be negotiated.

The heavily redacted Cabinet paper shows Hoggard warned there would be "cost implications" if New Zealand chose to go it alone.

"Significant resources will be required to develop the standard," Hoggard wrote.

"Should New Zealand opt out, we will require a process to review industry applications for new ingredients for infant formula including food safety risk assessments and management. This is essential to ensure we maintain the assurance of our export partners and equivalence of our food safety system.

"This work requires a specialist team with expertise in food science, nutrition, risk assessment, toxicology, genetic modification, dietary assessment and social science."

The minutes of that Cabinet decision also noted the "potentially significant negative economic impacts" on formula companies if the standard was adopted.

Ministers also agreed to "continue discussions" with Australia to allow New Zealand to opt into the standard in the future, the minute noted.

Industry, officials had similar concerns

Just days before the Cabinet decision, Fonterra, which was in favour of adopting the proposed new standards, had raised concerns with MPI officials about the "complexity" of creating a New Zealand-alone standard.

Fonterra questioned whether the ministry had the resources to implement and monitor such a standard.

"We would be concerned if resource was diverted away from other dairy sector priorities," it wrote to an MPI official on July 31.

MPI officials themselves were also concerned.

An internal memo from late August warned that developing a New Zealand standard would be "complex" and require input from a host of specialists to assess "composition and labelling requirements."

Why a NZ-specific standard was needed

An RNZ investigation has previously revealed how a handful of formula companies, led by Danone, The a2 Milk Company and an industry lobby group, intensely lobbied the government against adopting the new trans-Tasman infant formula standards, which were more than 11 years in the making.

The lobbying included bombarding senior ministers with emails, letters, surveys and legal advice, as well as having at least six meetings with Hoggard in the six months leading up to the decision.

Newly released documents from MPI show industry representatives met with MPI officials 18 times over the issue between May 2023 and July 2024.

Fonterra attended two meetings, Danone, which strongly opposed the standards, had three, including one where it brought seven executives. Fonterra and a2 typically brought only two executives to the meetings.

The a2 Milk Company met with officials four times, as did the industry lobby group Infant Nutrition Council. The Dairy Companies Association of New Zealand (DCANZ), headed by Hoggard's sister, also had two meetings with MPI.

Two of the 18 meetings were regular MPI Dairy Product Safety Advisory Council meetings, attended by multiple dairy companies. They are included in the total count because the infant formula standards were discussed at these meetings. Representatives from INC, Danone, Fonterra, DCANZ and Synlait attended.

MPI told RNZ that DCANZ "has advised that they did not take a position on the options in these meetings."

In addition to the many meetings, emails showed that the INC had at least two phone calls with MPI staff in July, though these were not officially recorded as meetings.

'Targeted' consultation

MPI also held "targeted stakeholder engagement" with a handful of formula companies in October to discuss how infant milk should be regulated.

It met with Danone, a2, Fonterra, Nestle, INC, and the Ministry of Health and the Ministry of Foreign Affairs and Trade.

Fonterra, Nestle and the Ministry of Health supported New Zealand opting into the FSANZ standards.

In a statement, MPI said the consultation was part of its process to explore next steps.

"This engagement informed a wider and ongoing process to develop options for the Minister to consider. These types of engagements are common practice and allow those who are affected by Government regulations to provide expert feedback," New Zealand Food Safety Deputy Director General Vince Arbuckle said.

New Zealand "remains committed" to the joined food system with Australia, he said.

In a statement, Hoggard's office said the situation with infant formula had not "materially changed" recently and he had nothing to add.