Oxford Economics finds proposed Nutrient Profiling Model reforms could impose multimillion-pound costs and reduce the availability of some healthier food options.
Food manufacturers could face implementation costs up to 50 times higher than government estimates and be forced to remove more than one in 10 products from sale under proposed changes to the Nutrient Profiling Model (NPM), according to new research from Oxford Economics.
The report, based on evidence from some of the UK’s largest food and drink manufacturers representing around 15,000 products, found that the reforms would cost manufacturers an average of £2,812 per product to implement, compared with the £53 per product estimated by the Department of Health and Social Care (DHSC).
Manufacturers also expect to lose an average of £10m in sunk investment costs from products developed to meet existing regulations that could now be reclassified as “less healthy” under the revised model.
Our analysis of the government’s impact assessment suggests costs to businesses are being significantly underestimated, while the health impacts are unclear.”
Alex Stewart, Associate Director at Oxford Economics
Potential costs far exceed government estimates
Oxford Economics found that the reforms would affect significantly more products than government forecasts. Researchers estimate the number of products subject to advertising and promotion restrictions would increase by 40 percent, almost double the government’s estimate of 22 percent.
High-fibre breakfast cereals, fruit yoghurts, lower-sugar cakes and reduced-salt crisps could all fail the proposed NPM criteria despite manufacturers reformulating them to offer healthier alternatives. Surveyed manufacturers said they expect to delist more than one in 10 products if the changes proceed.
The report argues that government underestimated the resources manufacturers will need to comply with the revised rules. While the government’s Impact Assessment assumes businesses need only a few hours to understand and implement the changes, Oxford Economics highlights the additional work required to update systems, train teams and apply the new criteria across large product portfolios.
“Our analysis of the government’s impact assessment suggests costs to businesses are being significantly underestimated, while the health impacts are unclear,” said Alex Stewart, Associate Director at Oxford Economics. ”This reinforces the importance of post-implementation evaluation of existing policies and gathering further proof points, such as those from our analysis, to inform the final impact assessment.”
Questions over health benefits and consumer choice
Oxford Economics also highlighted uncertainty around the health benefits projected by government. The report found that DHSC’s projected calorie reductions rely on estimates that sales of less healthy products could fall by anywhere between 16 percent and 90 percent, highlighting significant uncertainty over the policy’s real-world impact.
The report warns the reforms could reduce access to products designed to help consumers make healthier choices. It points to separate research from Nesta showing that small changes in purchasing habits, such as switching to healthier alternatives, could reduce calorie consumption by 8.5 percent and halve obesity rates in the UK within five years.
Industry calls for alternative approach
The findings come as manufacturers continue to face rising operational costs and regulatory pressures. The Food and Drink Federation (FDF) has warned that food inflation could reach 9-10 percent, limiting businesses’ ability to absorb further costs without passing them on through the supply chain.
The latest phase of advertising and promotion restrictions only came into force in January 2026, making it too early to judge their effectiveness. FDF is therefore calling on ministers to rethink the proposed NPM reforms and instead introduce mandatory reporting of healthier food sales across the sector.
The trade body argues that a standardised reporting framework would provide a transparent way to track progress towards healthier diets while encouraging continued investment in reformulation.
FDF says manufacturers have already made significant progress in improving the nutritional profile of their products. Over the past five years, members have reduced the sugar, salt and calories they contribute to the UK grocery market by 19 percent, 18 percent and 17 percent respectively, while improving the NPM scores of their products by 13 percent.
Kate Halliwell, Chief Scientific Officer at the Food and Drink Federation, added: “This analysis shows DHSC has significantly underestimated both the cost and impact of its proposals on food manufacturers, while relying on limited evidence to support its health claims.
“By contrast, there are early indications that the current advertising and promotion regulations, the most recent of which came into force this year, are having an effect on what consumers are buying.
“At a time when food businesses are already under intense cost pressure, these proposals will add further strain on the sector and, perversely, risk removing from shop shelves many of the products that help consumers make healthier choices.
“We urge government to work with industry on a more proportionate approach that protects consumer access to healthier options while promoting healthier diets.”
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