A joint Knesset subcommittee on pricing of the Finance and Economy Ministries has recommended to MKs that they pass legislation to regulate the price of baby formula. The subcommittee had been asked by Finance Minister Moshe Kahlon to look into the matter, after complaints by many Israelis that the price of baby formula was too high.
According to the subcommittee, prices for formula in Israel are as much as 12 percent higher than they are in most countries, including the U.K., New Zealand, Holland, Romania, France, Germany and many others. The market is controlled by two major producers, who control 80 percent of sales. While the preferred solution in such cases is to increase competition, members of the subcommittee told MKs that they felt that setting a maximum price for formula would be more effective, as formula is a basic need for many families.
The next stage in the process of implementing price controls on formula is to hold public hearings, in which Israelis will be invited to present their opinions on whether or not implementing the regulation is a good idea. The subcommittee will use that information, as well as the data it has already gathered, to make final recommendations on whether and how much to implement controls.
Kahlon praised the subcommittee for its work, saying that lowering the price of formula was a logical step in his efforts to lower the cost of living for all Israelis. “Baby formula is a basic commodity, and the findings of the subcommittee indicate that there is a measure of monopolization in this market,” said Kahlon. “We will act to end this situation.”