House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

HEALTH COMMITTEE

 

 

OBESITY

 

 

Thursday 27 November 2003

MR A COSSLETT, MR J HILTON-JOHNSON, MR M GLENN and MR T MOBSBY

Evidence heard in Public Questions 737 - 914

 

 

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Oral Evidence

Taken before the Health Committee

on Thursday 27 November 2003

Members present

Mr David Hinchliffe, in the Chair

Mr David Amess

John Austin

Mr Keith Bradley

Mr Simon Burns

Mr Paul Burstow

Siobhian McDonagh

Dr Doug Naysmith

Dr Richard Taylor

________________

Memoranda submitted by Cadbury Schweppes and Cadbury Trebor Bassett,

 

McDonald's Restaurants Limited, PepsiCo UK and Kellogg Company

 

Examination of Witnesses

 

Witnesses: MR ANDREW COSSLETT, Managing Director, Europe, Middle East and Africa Confectionary, Cadbury Schweppes, MR JULIAN HILTON-JOHNSON, Vice-President, Restaurants Ltd, MR MARTIN GLENN, President, PepsiCo UK, MR TIM MOBSBY, Area President, Kellogg's Europe, examined.

Q737 Chairman: Colleagues, can I welcome you to this session of the Committee and particularly our witnesses, we are very pleased to see you here and thank you for your very helpful written evidence. Perhaps you would each like to introduce yourselves to the Committee.

Mr Cosslett: Thank you, Chairman. My name is Andy Cosslett. I am responsible for Cadbury Schweppes' business in Europe, the Middle East and Africa and that includes the 6,000 people we have in the UK where obviously the business was started in 1824. The products we sell are well known, Cadbury Dairy Milk, Crunchie and other sweets nowadays such as Halls Mentholyptus and Jelly Babies and Wine Gums, a wide variety.

Mr Hilton-Johnson: Good morning. I am Julian Hilton‑Johnson. I am Vice President of McDonald's in the UK. We are very pleased to be here. We feel that a sensible debate is long overdue. We are keen to tell you about some of the initiatives that we have and to learn what more we can do.

Mr Glenn: Martin Glenn. I represent a newly formed business called PepsiCo UK which comprises Walkers, snack foods, so Quaker foods, Tropicana and Pepsi Cola. We employ about five and a half thousand people in the UK. We work in markets that are responsible for about seven per cent of the total calories consumed. We are relatively modest advertisers, as we said in our submission. I would echo the points that Julian just made, we are keen today to try and make a contribution to this important debate.

Mr Mobsby: Tim Mobsby of the Kellogg's company. I am 25 years in the food industry, of which 20 years have been with Kellogg's. Kellogg's, which is probably well known to everybody in this room, I would be surprised if it was not, has been in the UK for some 80 plus years and is synonymous with the breakfast occasion; if you think of us you think of the breakfast table. We are very pleased to be here and to contribute. It is a huge issue for society, we agree with that, we think the food industry has a role to play and as a company we are keen to, and believe we can, play a role.

Q738 Chairman: The acoustics in this room are not good and obviously we have got a fairly large audience, so if the witnesses could speak up I would be very grateful. You have all said both in your written evidence and in your opening remarks that you welcome the opportunity to give evidence to this inquiry. Do you feel it is appropriate for an inquiry into obesity to focus specifically on your products?

Mr Glenn: We think with obesity one has to look at two sides to a very simple equation, calories in and out, you cannot look at calories out on its own. It may be the perception of some members of this Committee that that is what the food industry is doing. We also understand that calories in are an important part of it, but we represent the broad gamut of food types, from breakfast cereals to savoury snacks, to confectionary, to takeaway food. I guess all of us would say that you have to look at diets in total and not the individual food types in a similar way to understand the total issue.

Mr Mobsby: I think this is a complex issue. In many respects it is a social issue and as such there are lots of constituencies who need to participate and be involved and help formulate solutions. I think the food industry is one of those but it is by no means the only one, there are lots of others and I think we have got an area here where some leadership is probably required and I think we would look to Government to help with providing some of that leadership.

Mr Hilton-Johnson: I would agree with both those comments.

Mr Cosslett: The big brands tend to get it in the eye, but the food industry is an enormous industry and we account for a reasonably small percentage of it in total as a group. What we have tried to do in the last six months is to understand a lot more about the issue and what people are doing and hopefully during the next couple of hours we will have a chance to talk about that. I have lived overseas, I have lived in Australia, I have lived in the Far East and the fact that this is a global issue I think is very interesting and in looking at the common trends in those different markets, some of which actually have fairly low consumption products like ours, I think is an interesting point that we have tried to understand a bit better and again maybe we can touch on a couple of those as we go through.

Q739 Chairman: The energy in, energy out issue has been raised with us on many occasions. Am I being unfair, having read your evidence, stressing as strongly as I did the need to increase activity levels but not saying a great deal about the need to reduce consumption of energy against food and drinks because you do not seem to say a great deal about that?

Mr Glenn: I believe in our submission we have given due weight to that. It is important that when you look at the calories in you look at the total diet and I think there is a preconception that it is taken as read, that somehow snacks are not "proper food", they are not part of the diet, whereas the fact of the matter is for most people in today's busy society they are. I think what we tried to show in our submission is that for the last two years Pepsi Cola has taken some pretty important steps to compact the obesity issue because it is in our interest to do so. It is not in our interest to have unhealthy people in society and as individuals we do not want it either. What we tried to stress in our submission was how we are looking at reformulating our core products, we are talking about how to reduce the saturated fats in our Walkers crisp brand for example. The fact is that the majority of the Pepsi that is sold today is in diet form as in no calorie and there is a big corporate programme for PepsiCo in our submission and the first appendix. A large part of the annual report this year from our chairman stated that it is the global goal of PepsiCo to offer more choice in terms of energy dense foods and the like.

Q740 Chairman: Mr Cosslett, your evidence refers to the Jebb/Prentice paper and their evidence. My recollection of Professor Prentice's evidence is that when he came to the Committee he was quite critical of the food industry in that he felt that his research and his colleagues' research had been somewhat distorted by the food industry. He said he was "less than pleased" at the way his research had been "wilfully misused" by the food industry so as to imply "it is nothing to do with food, it is all down to physical inactivity". The data on food consumption is not reliable and yet it would appear that the evidence that you have specifically referred to, indeed your colleagues base so much of what they are arguing on what he said, is rather unreliable. Do you want to respond to that point?

Mr Cosslett: I think one of the general issues here is that we have as an industry, as a society, not good enough data anyway and I would accept that.

Q741 Chairman: So you would accept that the data he was referring to was not reliable?

Mr Cosslett: It is the only data we sensibly have as an industry to use, so I have to look at the trends and I think if you use it for that then it is probably quite sensible. We have tried to do some work on our own to understand our industry better and we would certainly agree with the premise that there is under‑reporting going on on most foods and some more than others. There is definitely a difference in our industry between what we believe is consumed and what the NSD says. I do not think we were being critical and certainly if that was the reference I would be surprised because we were never trying to exploit that data in any way, we were trying to use what was available in the public domain as a way of corroborating our own studies and working to try and get the triangulation right. I think it is very important that we do actually track down because since then we have gone on to examine more about general food consumption which does throw some interesting light on how the data is presented, such as the diets of people who have weight problems and the differences over what they do. I would be delighted to submit our information to the Committee to help build on this, but I do think we need a more robust and double‑checked set of data that we can all rely on going forward.

Q742 Chairman: On the basis of this energy in, energy out issue which I think we all understand and all agree is key to this question, I am interested in how you evaluate that point in terms of your own products, your own marketing. Mr Hilton-Johnson, one of the pieces of evidence we have before us suggests that a cheeseburger with fries and a milkshake contains 1,050 calories, so the energy in is 1,050 and to get rid of that energy I am advised that an individual male adult would have to do a nine mile walk. In what sort of ways is that reflected in your awareness of this energy out issue?

Mr Hilton-Johnson: Dealing first of all briefly with the energy out side, we have a long track record of involvement with sport going back to the 1980s. We are involved with over 500 clubs at local level and we have partnered with four national football associations and we are intending to create 10,000 new community football coaches over the next four years, that will be something like 0.3 million hours of coaching. I think we have a reasonable track record in encouraging particularly young people to take part in sport. What we try to do on the diet side is this: firstly, most people who come to visit our restaurants come two or three times a month and what that means is that they are eating 97 or 98 per cent of the food that they consume outside our restaurants, so that is going to have a very minor effect on their overall eating habits, on their diet. What we have done over the years is we have tried to make sure that we do provide nutritional information and in fact we started doing this comprehensively in 1984 in leaflet form. We have built on that in our customer services helpline, on our website and most recently by putting it on the back of trayliners as well so that people are able to make decisions about what they want to eat when they come to us on a fully informed basis. If they want to eat a cheeseburger, they can do that; if they want to eat something else, they can do that. It is all about getting people to understand what it is they are eating and allowing them the choice to do that.

Q743 Chairman: Are you saying it might be reasonable for this Committee to be recommending that perhaps meals of the type I have just described should be sold on the basis of what the energy out implications are, ie if I consume the cheeseburger, fries and the milkshake then to get rid of that energy I have got to expend probably nine miles of walking or whatever? That is a pretty blunt message to me. Obviously as a Committee we are looking at what we will recommend and we have made no decisions at this stage. If we are looking at the parallels with tobacco, we have got some pretty blunt messages on cigarette packets. Are you accepting the need for people to be aware of a range of issues to do with your products? You have mentioned that you are informing people. Do you feel that people ought to be informed fairly bluntly about the implications of the consumption of a product of this kind?

Mr Hilton-Johnson: With respect, I draw a distinction between the food industry and the tobacco industry.

Q744 Chairman: I understand that.

Mr Hilton-Johnson: It is certainly important that people have an understanding of the need for a balanced diet and for a healthy, active lifestyle, I accept that. I cannot comment on whether you should go further and the specifics of the way in which you would do that, but I think it is a challenge for all of us in industry and within Government to communicate the energy balance in an effective way, I certainly accept that.

Q745 Chairman: And you feel you have a responsibility to do that?

Mr Hilton-Johnson: We certainly have a responsibility to communicate what it is we are selling and, on top of that, as a company over many years we have promoted a healthy, active lifestyle as well.

Q746 Chairman: The point I am making is that perhaps the message is not sufficiently blunt and if it was put in as blunt a fashion as I have put it to you that might be more effective. Would you accept that?

Mr Hilton-Johnson: I do not think it is about whether it needs to be blunt or not, it needs to be effective.

Q747 Chairman: Blunt is perhaps the same word. Could it be simplified?

Mr Hilton-Johnson: It should certainly be simple because obviously customers are buying food two, three, sometimes four times a day, consuming food at that kind of interval, so it is important that whatever message is put out is simple.

Q748 Chairman: A lot of us on the Committee have pedometers, which is a very interesting measure of exercise and it is very easy to convert the intake to the energy output required. In terms of your products, not just yours but your colleagues' as well, is it possible for us to think about how we might do this to enable people to understand the implications of what they are consuming more easily? At the moment calorific content does not mean a great deal to people, you look at the labels or whatever. Would it be helpful if we simplified it in the kind of way that I have suggested this morning?

Mr Glenn: Absolutely fundamental to this issue is information and I think you are absolutely right, people do not really understand. It is an individual thing, it is about how someone doing a physical job needs to consume more calories and information is the key to it, but I think you have to be universal in the approach to that. You said food of this kind which implies that the assembled witnesses here today are marketing a certain kind of food which you feel perhaps requires a special kind of labelling. I think a big advantage would be for all food, whether it be packaged food, food in the Gay Hussar restaurant ---

Q749 Chairman: I do not go into the Gay Hussar restaurant!

Mr Glenn: You need the same thing. Consumers are quite confused. People have got fat on low fat diets because they have not taken in the golden rule of calories in, calories out. If you take the snack industry, we voluntarily put what we call the big eight food-type labelling on the back of our packs which is actually in excess of what we need to do statutorily because it is quite important that people understand that and I think that is the key message. Whether it is blunt or whether it is effective is the key thing and what is the psychology of these people taking these messages in. Information for everyone, not just for snack food, for Cornflakes, for chocolate bars etc. You can get fat on avocados.

Q750 Chairman: I take the general point. I was taking the specific example of the cheeseburger, fries etcetera because I have an example in front of me of the calorific content and the energy output needed. I agree with the general point you are making.

Mr Mobsby: It is about providing information, but we have to try and make sure the information is helpful and as informative as possible for people. I am not sure of exactly the best way to do that and you have made one suggestion there, but I would be open to other possibilities. What we need to do is talk with consumers to try and understand what helps them. Is it as a percentage of what their recommended calorie intake for the day should be? I am not sure what the right answer is. I think the principle of saying that all foods should cover helpful information is absolutely right.

Mr Cosslett: I would support everything my fellow witnesses have said. One of the things that we have alluded to in the last few months of looking at this is the difference in labelling in the packaged food industry and I agree with your point about clarity, but we have labelled since 1988. There is this huge area of food consumption and it is the fastest growing. Since 1992 to 2002 the out‑of‑home eating market has doubled in size. My products have been pretty flat in that time and I would imagine that my colleague from Walkers might say the same. That does not mean we are not responsible for trying to help. If you are looking for correlations of what has gone up, the growth in the out‑of‑home eating market has been staggering, it has grown £10 billion in ten years and in most of those places there is not a strip of information available. So when Tony Blair and George Bush got together and had their fish and chips and a pint of beer and maybe a crème brûlée, that was 1,500 calories. How would they know that? There is no way you could know that. I know this is a sensitive area which I am sure we will cover, but children in schools eat about 800 or 900 calories a day. Anything that we could do that could get a universal signage ‑ and WeightWatchers seem to manage to do it -maybe a numerical code that we could all use, if we could get people round the table from the food and restaurant industry and the pre-packaged industry, snacks, confectionary, staple diets, the entertainment industry and put it altogether with Government support, I think we could crack this and do something quite valuable.

Mr Hilton-Johnson: I have four points to make. Firstly, whatever we do has to be simple and therefore it has to be consistent so that people do not have to change from one formula or message to another. It is important that it is done before the purchase takes place and that obviously has implications in our particular business, and I think that the industry is in touch with its customers and has the ability to communicate effectively, so if we work together I think we can do a good job.

Q751 Mr Burstow: I want to follow up on the point Mr Hilton‑Johnson has made. You are saying that that is something you would like to do now. Have you started work? Are there plans for to you get together after this inquiry today to start that sort of task of coming up with proxy measures of calorific intake? The Chairman has mentioned one which is numbers of steps. Another which certainly might relate to some of the products we are talking about here would be the amount of sugar that is in a product. For example, would it be a helpful way of measuring to use the numbers of spoonfuls of sugar that your products consume?

Mr Hilton-Johnson: Each of the companies here probably has some very good examples of things that they have done in the past and things that they have announced for the future. The industry itself announced a joint initiative a couple of weeks ago in which they have said they will come together and work much better. So the short answer is yes, the industry is coming together now and is working together to try and build on some of the individual company initiatives.

Q752 Mr Burstow: What sort of timescale is that on?

Mr Hilton-Johnson: I do not have details of the timescale. We recognise that it needs to be quite quick.

Q753 Mr Burstow: Mr Glenn, I want to ask about calories in and I think it is a very important issue you draw to our attention in terms of the need to have a balance there. In the second bullet point on page 5 you refer to one of the ways in which you as a company are using your packaging as a way of trying to deal with the calories in. You talk about providing a variety of pack sizes to enable control and you go on to say that the majority of Pepsi Cola sold in grocery stores is in re‑useable, re‑sealable two litre bottles. Is that not just really super‑sizing the product? How does it reduce consumption?

Mr Glenn: Supersizing to me is selling very large, individual ready to consume portions and we know that people do not use two litre bottles all at once, they put some in a glass and it lasts the week. The fact it is resealable and not sold as a ready to drink there and then pack makes the point.

Q754 Mr Burstow: If one chooses to drink a can of Coke, that is gone, that is dealt with, whereas if they go into the supermarket and buy one of these massive two litre bottles of Pepsi Cola you are encouraging people to purchase a far larger volume of Pepsi Cola then they would otherwise be purchasing. Is consumption going down of your Pepsi Cola as a consequence of two litre bottles being the main way in which people are now purchasing your product?

Mr Glenn: The Cola market is not growing, so that answers the first question. That said, there has been more growth within the total Cola sector, in the dietary sector, in the low sugar market as opposed to the full sugar market. It is about offering people choice. People do not consume two litre bottles of Pepsi. The interesting balance is Coke as well because Coke also sells two litre bottles and given they are not here and I am I can say that.

Q755 Mr Burstow: I am sure they will thank you for that bit of marketing.

Mr Glenn: It is obviously about offering consumer choice. Consumers want to buy products in these formats and, trust me, the two litre bottles of Pepsi that we sell are not consumed in one go.

Q756 Mr Burstow: I accept the point about providing consumer choice, but does it actually help in a significant way to manage the intake of calories? What evidence do you have for that?

Mr Glenn: Consumers make the choice and I think that is the key part of this. Individuals need to make the choice about how to regulate the calories that fit with their lifestyle and I would have thought a resealable bottle is a big help in that as opposed to a bottle that does not shut.

Q757 Mr Burstow: Was your choice to offer two litre bottles driven by a desire to give people that ability to make a choice about calories or were there other considerations in your decision?

Mr Glenn: We are a commercial enterprise who are in business because people put their hands in their pockets, take out money and buy our products, so we follow what consumers want. Consumers want convenience and a two litre resealable Pepsi bottle gives people convenience.

Q758 Mr Burns: Is it not fair to say ‑ and I happen to have been in a McDonald's recently in my constituency ‑ that there are quite a lot of leaflets available to customers before they purchase? For example, there are things like "Five a day can be fun" which actually spells out quite categorically the Government's message that an apple a day is good, five fruit and vegetables a day, the actual criteria of good foods and you have leaflets that they can assess before they purchase whatever food they want. Is it not also fair to say that there are documents produced like "Our Food" which will give consumers rates of fat, energy etcetera, etcetera, so they have the information and they can then take what they regard as responsible decisions on the intake of their food and their children's food?

Mr Hilton-Johnson: Thank you for mentioning that, Mr Burns.

Chairman: Are you sponsored by them?

Q759 Mr Burns: No, I am not sponsored by McDonald's and never have been in my life.

Mr Hilton-Johnson: As I said previously, we do have a good track record in trying to provide nutritional information to our customers which goes back to 1984. We do not have to do it, we do it voluntarily. We do it in a number of different ways and I will not go through them again, but yes, you are quite right. The leaflet that you have there was written by our nutritionist in the UK and what it is supposed to do is to assist in promoting a Government message about five a day. We have always advocated the importance of a healthy, balanced diet and that is supposed to build on that and if there are more things that we can do in that respect then we would be very pleased to consider them. I would go further than that. If I understand correctly what the Government is saying, there are some communities in Britain where it is particularly difficult to get certain messages across. We sometimes have a presence in those communities and so we can actually help in some of the most difficult areas.

Q760 Mr Burns: There was quite a lot of coverage last year with regard to McDonald's in that your growth was slowing down worldwide. Since then as a company you have taken action in developing new products, pricing, marketing. One of the things that has become quite apparent particularly in the United States but it also has been reciprocated here in this country is you have developed markets for more fresh fruit, more salads to meet a growing concern with obesity and being overweight. What sort of impact is that having or is it too soon to be able to judge? Are people, because of the high concern and publicity about being overweight and obesity, beginning to come to your restaurants and change their purchasing habits to try and reduce their own individual problems and to meet this growing concern?

Mr Hilton-Johnson: I think a lot of people would be quite surprised by the number of changes that have happened at McDonald's over the last ten to 15 years and the last 15 months or so. We have changed the formula in a number of our food items. We have introduced orange juice and no added sugar yoghurt for children, organic semi‑skilled milk and we are now the leading retailer of pre-prepared fruit in the UK. We wondered how well this was doing. We sold 1.3 million packages of fruit in the first three weeks. It is very difficult to say how much of the recent success of McDonald's is caused by this and the data that we have is not absolutely conclusive, but if you look around the world, countries such as the USA and Australia are doing particularly well at the moment on the back of a range which I think they call "Salads Plus". We are trialling these in London, we have salads in all of our restaurants and we are hoping to roll these out next year and it is absolutely clear that customers' tastes do change over time. Our trick is to understand how their tastes are changing and to provide what it is they want accompanied by the right nutritional information.

Q761 Mr Burns: Would you also agree, or possibly disagree, that the whole question of diet is one of balance and that you cannot categorise certain groups of food preparation or food as the guilty partner in contributing to people being overweight? Other foods that would not necessarily be associated with the fast food industry can, if eaten to excess or in the wrong ways, cause problems and it is a balance between a balanced diet and also a balanced diet and exercise and one has to look at it as a whole rather than just trying to lay the blame in one area for a whole problem and trying to start interfering in a way that might be counterproductive.

Mr Hilton-Johnson: I would certainly agree with that. It comes back to the question of the energy balance that we discussed earlier. Most people come into our restaurants two or three times a month and if they wish to have a hamburger, they will have a hamburger; if they wish to have salad with a grilled chicken product, they will salad with a grilled chicken product. The thing that concerns me most about some of the debate that has gone on is it has been polarised. If, as everyone says, we have to work together then polarising the debate will not assist in any way, so to my mind it is recognising the energy balance, putting away certain prejudices that some people have and coming to the table to work together.

Q762 Mr Amess: You are saying you want the Government to take a lead on this?

Mr Hilton-Johnson: I think it would certainly be logical for the Government to act as a leader and a co‑ordinator, yes.

Q763 Mr Burns: Should it not be the parents who take the decisions for what their children eat and what they themselves are eating, should they not be taking the responsible decisions to ensure that there is a balanced diet for them and their children and that they all take exercise as well?

Mr Hilton-Johnson: In the case of children, of course it is parents who have to take responsibility for what their children eat. I have two boys aged two and four and I go with them to McDonald's once, twice, three times a month. They love the food, they love the whole experience and I enjoy taking them and it is not just because I work for McDonald's, it is a fun eating out occasion for the family, but ultimately my wife and I decide what they eat. The important thing is that the parents are armed with the information not just in McDonald's, everywhere, about what they eat and how that fits into the energy balance that we have discussed, that is the key.

Q764 Dr Naysmith: You are talking about it being alright for someone to go into McDonald's once a month and have a meal. Is there anything equivalent to what happens when you get a heavy drinker in a bar? Someone who comes in once or twice a day and is eating nothing but McDonald's, are there any instructions for staff to suggest they might consider not doing that and having something else instead?

Mr Hilton-Johnson: I do not think it is for us to presume to tell our customers what they should be doing and what they should be eating on a particular occasion.

Q765 Chairman: Surely you are doing that anyway with your leaflets.

Mr Hilton-Johnson: We are encouraging a diet. What we are not saying is that on a particular occasion you must eat this or you must not eat that, I do not think that that would be appropriate, no. It comes back to personal responsibility and then understanding what it is that makes up the balanced diet and the healthy, active lifestyle.

Q766 John Austin: We are going to come on to advertising and marketing later. You offer a free toy with a Happy Meal.

Mr Hilton-Johnson: It is not free, the parent has to pay for it, you can buy the toy separately.

Q767 John Austin: In order to collect all of the toys in the range you would have to eat about three or four Happy Meals a week. Is that a balanced diet?

Mr Hilton-Johnson: When we run promotions, you are quite right, sometimes we have four or five toys in a set that is usually run over a five or six‑week period. The objective of the promotion and the result of the promotion is not principally to drive people to come in more often, it is largely designed to get different people to come into our restaurants and we find that most people come in two or three times a month.

Q768 John Austin: But a child would want to collect the whole set, is that your experience?

Mr Hilton-Johnson: It is not our experience, no. Some do, but the fact is that most come in two or three times a month.

Q769 John Austin: In order to do so they would have to eat three or four Happy Meals a week. I am asking you if you think that is a good thing to do.

Mr Hilton-Johnson: If they eat three or four Happy Meals a week they get three or four of the same kind of toy.

Q770 Mr Bradley: When you have a range of toys as a promotion it is not your intention for the children to get the set, you do not anticipate that that is the motive for the child whether or not the parents try and influence that? You are saying that when there are these five items that you can get by going to McDonald's it is not your intention to expect the child to try and collect those five items?

Mr Hilton-Johnson: The Happy Meal is an advertisement and the Happy Meal contains the food, the drink and the toy. The majority of Happy Meal advertising is aimed purely at the parents rather than at parents and at children and obviously the parent makes the decision about whether or not to go into the restaurant. Our intention is of course to raise the frequency slightly, but it is very slightly. If you look at the information that has been submitted you will see that the average number of times that someone will come in will be two or three times a month. Above all what we want to do is to encourage different people to come into our restaurants and to enjoy the experience, that is the objective of most advertising.

Q771 Mr Burstow: I would like to come back to something that you were discussing earlier, which is this whole question of balanced diets and your part and other food producers' part in helping people achieve that balance. I was certainly struck by the point that I think Mr Hilton‑Johnson made earlier about snacks being part of the diet whether we like it or not, they are there, they are part or maybe it was Mr Glenn. What quantities of your own food products would you advise parents to allow a typical five-year old to consume in an average week? How many Happy Meals would you be saying should form part of a balanced diet in a typical week, or in the case of Pepsi, a 12 ounce can, how many of those should a typical five-year old consume in a week, or in the case of Kellogg's, what about Coco Pops, how many packets of Coco Pops should be consumed in an average week by a five-year old, and how many Chocolate Buttons? Could you give us some idea of where you are able to give that sort of advice so that we can make meaningful this idea of a balanced diet?

Mr Mobsby: I will take the specific example you gave of Coco Pops. I would be quite happy if a child ate Coco Pops most days of the week. The average child eats five to six servings of a cereal a week. Why do I say that? Because we know that one of the biggest risks at breakfast is that children do not eat breakfast at all and if they do not eat breakfast they do not make up the nutrients that are not consumed at breakfast time. We know the consumption of cereals provides one‑third of the milk consumed in the diet, 25 per cent of the iron and close to 30 per cent of the calcium consumed in the diet. The role that breakfast cereals play in relation to the diet on a regular basis is actually very significant and very important, so I would be very happy. Our bigger concern is that kids do not have breakfast often enough.

Q772 Mr Burstow: We have seen and heard evidence to the effect of just how crucial breakfast is in terms of regulating and balancing a diet throughout the day and I take that point entirely. In the case of Coco Pops, 36.3 grams out of 100 grams is sugar. Does that start a person off well at the beginning of the day? A five-year old whose necessary intake of sugar is not massive, is it a good basis for the rest of the day to consume that amount of sugar for breakfast?

Mr Mobsby: Let us remember where the word comes from "breaking the fast". It is not uncommon that the child has not consumed any food for 12 hours, possibly longer. What they need is a multiplicity of nutrients of which sugar, which gives a shorter, sharper boost of energy, is one component and also complex carbohydrates in the form of starch which provides longer‑term energy, the milk does the same, plus the other micronutrients. So sugar as a component of that is a positive element.

Q773 Mr Burstow: You are saying you would not have a problem recommending as part of a balanced diet that Coco Pops are consumed every day?

Mr Mobsby: I would say breakfast cereals should be consumed every day, I would be quite happy with that recommendation. Then it is a question of choice being provided. If anybody eats any single food too much then we would not recommend that, of course not. In and of itself a single breakfast cereal we would still say is a positive start to the day. Typically in the household, as we say in the memorandum, there are four or five different varieties of cereals available. Kids want variety, they are not going to eat the same cereal every day of the week, they will get fed up with that and so they switch around between cereals during the course of the week. The key is they have something at breakfast, that is the first and most important thing and cereal for them is rather more palatable and a more easily to digest food and carries lots of other values with it.

Q774 Mr Burstow: I wonder if Mr Glenn could talk about the 12 ounce can of Pepsi Cola and tell us how he would see that being part of a balanced diet and how many cans.

Mr Glenn: The problem with the approach, with respect, is it is the presumption here that we are talking about bad foods and I think the only sensible way to make headway on the obesity debate is rather than telling people lots and lots of specific product sector by product sector dos and don'ts to get over some simple points about a balanced diet. People on average in the UK consume between two and three bags of crisps a week. I think the average consumption is about 1.8 litres of soft drinks a week. We know that it is part of a balanced diet. You have to focus on diet. If you tell people how to make their diets up by saying do not do this, do not do this, do not do this then you are, frankly, not going to succeed. We need to get people to understand the diet, to understand the concept of moderation and by educating people on a simple measure about calories - and I would not get sidelined by sugar etcetera, it just confuses people - and if there is calorific information on the pack, then as long as the parent is educated enough to understand what balance means they should then have the freedom to make the choice to build an enjoyable diet for them and their children.

Q775 Mr Burstow: From the evidence we have seen so far and certainly from my own personal experience I think many people would struggle to make a meaningful decision based on calorific information. The Chairman was asking questions earlier on about other proxy measures in terms of other ways in which we can make it more meaningful, whether it is the number of spoonfuls of sugar or whatever it might be. The reality is people, when they are making decisions about purchases in the supermarket or in a restaurant, are dealing with what is in front of them, they are not dealing in the abstract, which is what you are dealing with. Therefore, to make it meaningful you have to relate it back to products. How could you make it meaningful with regard to your products, particularly Pepsi Cola?

Mr Glenn: We have to get to an absolutely common, unambiguous currency to help this debate and to my mind that currency is calories, it is not proxy measures. Provided that information is there very clearly at the point of consumption as well as purchase (I think they are two different things) and people understand what a balanced diet for their individual circumstances would need to be, then that probably forms the debate about what this Committee might recommend going forward, which is how do we encourage people in this country to understand better the notion of calories in, calories out because I think that is at the heart of the educational gap within this whole debate.

Q776 Mr Burstow: Have you done any research yourselves on your consumers' understanding of calories and whether they do have any understanding of it?

Mr Glenn: We do a lot of research with consumers of our products. We understand where our products fit into the daily lives of consumers and for the sake of reputation, we think in the markets we compete in we would probably account for about seven per cent of total calories consumed and we feel very confident in talking to our consumers, especially in the light of the heat and excitement that this debate has caused, that most parents understand that they should take accountability for the healthy lifestyle and diet of their children and thank heavens most parents do. What we need to focus on are the few parents who do not because they do not know or for involuntary reasons they do not have that information. So the question should be positive, how do we get people to understand and most people in the population do understand and make that more universal.

Q777 Mr Burstow: Most of the population is getting fatter, that is the observation we have come across in this country and in the United States and across the world. Given that the whole population seems to be upsizing because of a lack of activity and perhaps an inappropriate balance in the diet, why is that message that you are just saying is there and clearly understood not getting through? Why are we still getting bigger?

Mr Glenn: I thought the terms of reference of the Committee was obesity, which is technically more than 20 per cent above one's ideal body weight.

Q778 Mr Burstow: Why as a society do we appear to be becoming more obese, because you are right and that is also part of what is happening, there is a shift going on across the population not just in particular parts of the population? Do you not accept that to be the case?

Mr Glenn: I do and I stand by the point, which is the majority of people do understand the notion of what a balanced diet and balanced lifestyle means for them and the approach to combating and targeting these two needs to be at a minority of people and it still is a minority who do not understand it and I think that should characterise the challenge of this Committee, the food industry and all of the stakeholders in the obesity debate.

Q779 Mr Burstow: The population as a whole is becoming more obese. Are people's choices making them more obese, is that what you are telling us?

Mr Glenn: I am not sure that was what I was saying. I was saying people have a choice in putting together their own definition of a balanced diet and most people do so effectively.

Q780 Dr Naysmith: Are you saying that people have a choice, if they want to become obese they can become obese, that is a free choice and you have got no part in that?

Mr Glenn: I am not a medical scientist and I know that you are. Obesity is a medical condition in part, but the reason that this Committee is sitting is that there is clearly an involuntary obesity going on, people do not want to be obese, people do not want to have the health issues and the problems that come with obesity.

Q781 Dr Naysmith: Given what you have been saying, if people are going to become obese then we have got to interfere in their freedom of choice if we are going to do anything about it. If they are free to become obese then we will have to interfere in it even though it means interfering in people's freedom of choice.

Mr Glenn: That is such an important point. I think tackling it is not going to be predicated by restricting freedom of choice because it just will not work. The way this type of issue has been successfully combated over other countries in the world is by encouraging positive lifestyle choices rather than negative. It is about education, not coercion. For example, on Pepsi Cola's board of health advisers there is a Dr Dean Ornish, who is the head of preventative medicine for an institute in California. He believes that they have made tremendous strides in combating heart disease in the US, not by threatening people and saying, "Do not do this. Do not do that or you will get ill", but by encouraging people that they will feel better if they make small changes to their lifestyles.

Q782 Dr Naysmith: We just have to interfere in that equation.

Mr Glenn: With respect, we need to educate. We have an obesity problem so let us not argue about that. The problem is that people do not understand the fundamentals to it. Rather than get diverted about proxy measures for spoonfuls of sugar here and grams of that there, it is calories. If people had that simple, straightforward unit of measure in their minds, we would be able to make progress on the whole area.

Mr Hilton-Johnson: I agree with a lot of what has been said. The concept of positive rather than negative messaging in communicating nutrition is extremely important. I bought a lawn mower the other day and I was advised not to trim hedges with it or to inhale the fumes. It is very important that the message is positive as well as simple and consistent. We cannot escape in a simplistic way the fundamental problem that the country is facing and that is the concept of diet as opposed to exercise. McDonald's and some of the other representatives here provide an enormous amount of variety. In my view, it would be simplistic to try and talk about particular units.

Q783 Mr Burstow: Earlier on, you were saying that we need to keep the messages simple and you were telling us that you wanted to engage in a serious debate about this. Surely as part of that debate you as a company would want to encourage people to come into your restaurants and buy your products and you should, in the literature we were shown earlier on, be including information to enable people to make those informed choices about how ----

Mr Hilton-Johnson: We do. There is a difference between simplicity and over-simplicity.

Q784 Mr Burstow: Therefore, does the literature that you produce already enable a parent to make a judgment about how many Happy Meals typically a five year old should eat?

Mr Hilton-Johnson: It stresses the importance of a balanced diet and a healthy, active lifestyle and it provides nutritional information about our food and our drink. Of course we want to do a better job. Can we do a better job? We will do our best to do a better job but I think the information that we have provided over the years is certainly more than we are legally obliged to do and we are very happy to do that and we want to build on that.

Q785 Mr Burstow: Do you think there is any argument for including any information on the packaging in which you serve your food?

Mr Hilton-Johnson: We provide a lot of information in leaflets, customer services, via the help line and on the website. I think we are slightly different to the other representatives here because if you label the food packaging itself you would only see it after you had bought it. The importance, to my mind, is to convey the nutritional information before the time that you buy.

Q786 Mr Burstow: You do not think it would be appropriate for you to say how many Happy Meals in a balanced diet for five year olds are appropriate?

Mr Hilton-Johnson: I would not want to simplify the debate for a person's lifestyle or energy balance.

Mr Burstow: Perhaps we can finish with chocolate buttons and Cadburys.

Chairman: Before you do that, these leaflets that Simon has supplied ----

Mr Burns: I collected them when I went to McDonald's.

Q787 Chairman: Are they available to people who are drive in customers, because I have certainly never see these. Are they available throughout the country, not just in Essex?

Mr Hilton-Johnson: There are practical considerations with a drive through. They would be made available to anyone who wanted them. What we do not have is a series of leaflets on the walls, but they are available throughout the country.

Q788 Chairman: You do not give them out with the meal?

Mr Hilton-Johnson: They are there, beside the counter, for people to help themselves.

Q789 Chairman: The drive in customer would not get a leaflet with the meal?

Mr Hilton-Johnson: No. They would not get a leaflet unless they asked for it.

Q790 Chairman: They would not ask for it if they were not aware of it, obviously.

Mr Hilton-Johnson: If they were not aware of it, they probably would not ask for it.

Q791 Mr Burns: Most of the clients presumably go into the restaurant.

Mr Cosslett: An average supermarket can carry about 200,000 lines and to try to get mum to understand every one of those in making a balanced diet is a challenge. There is a difference between known quantities and rather less known quantities. The work that we are doing at the moment would identify a strong correlation between the growth of unknown quantities in food and obesity rates. You grow up knowing about confection. Because it is not particularly low calorie and we have never pretended it is, you grow up knowing that it is a treat. Mums know it is a treat for their kids and manage it perfectly well accordingly. I think that is the reason why the confectionery industry is pretty flat because there is this natural control that takes place in the purchase of confectionery products. I would be more concerned where people are buying products that they think are low in fat and they are. I bought a low fat yoghurt the other day, thinking it was very healthy and it had more calories in than a large Crunchie. I was amazed and I am in the food industry. It is products that masquerade that people are consciously choosing because they think they are making a contribution and they are not. A mum who buys chocolate buttons for her children knows what she is buying. That is why they are six calories a button. They are portion controlled. In the whole of the confectionery industry, there is probably the widest range of portions you can imagine from a single button to a kilogram bar. The portion control in the industry moderates it. Part of the rites of passage of being a child is growing up and having a debate with your mum and dad about how much confection you can have. We know it to be true and we manage it accordingly. When you look at the information we are now starting to draw out about what overweight people are eating, surprising though it may seem, confectionery is not one of them. What they are eating more of are the things which they probably think are okay.

Q792 Mr Burstow: When you say "overweight people" are we talking about adults or children?

Mr Cosslett: Both.

Q793 Mr Burstow: Is there any divergence between the two?

Mr Cosslett: Virtually none.

Q794 Mr Burstow: Is that data you would be able to share with us?

Mr Cosslett: We would be delighted to share it. It is our first go at it. It was robust and it was done by an independent, very renowned agency. It is a very interesting insight because apart from telling you that they do 50 per cent less exercise than the general population it does start to give us some clues as to what they eat. They tend to have more meals, thinking meals are snacks. It is an insight into information that we could build on and the Committee could take it away and do more with it.

Q795 Mr Burstow: I take your point about false comfort being given by some of the labelling on some other products that you mention, but you mentioned treats and parents making decisions about how often a treat is available. That itself is a bit difficult and challenging because often one person's idea of the frequency of a treat is entirely different to another's. Can you offer us any thoughts on that, particularly when it comes to bags of chocolate buttons? Is a treat every day? Is a treat once a week?

Mr Cosslett: I honestly think it cannot be answered because it entirely depends on what else is being consumed and how active the person is. If you have someone who is extremely active, running around a lot and has no other treats, then a bag of buttons would be perfectly acceptable every day. If someone was doing less activity, which unfortunately more and more of our children are, and they were having plenty of other treats then the consumption would need to be moderated. There is not one average child; there are just individual children with parents who are trying to make decisions for them. In a very great number of cases - the statistics will support it - people do make good choices about confectionery and understand that a treat is something that is at the discretion of the parent. Most people do not seem to have a problem with it.

Q796 Dr Naysmith: You were talking about research that suggested people who were tending towards overweight and obesity did not eat sweets or that it was not due to eating sweets. Is that right?

Mr Cosslett: No. I said they eat less than the general population.

Q797 Dr Naysmith: I wonder how that research is done. Is it self-reporting? Do they tell you?

Mr Cosslett: Yes.

Q798 Dr Naysmith: We have already talked about the national fruit survey and there are three times more of certain types of sweet produced than people are eating because people tend to feel a bit guilty about it.

Mr Glenn: It is in our submission. We use the same research to get the same information.

Q799 Dr Naysmith: How reliable is it?

Mr Glenn: They are self-completion questionnaires. All this is indicative, not chapter and verse. It is diary panels. People write down over the course of a week what they are consuming, so it is about occasions rather than weight.

Q800 Dr Naysmith: Do they know the purpose of it? Do they know that you are doing it for that particular purpose?

Mr Glenn: No. We found it serendipitously. It is a panel that many food companies use to look at the total gamut of what people are eating. We typically would use it in the Walkers business to understand how often maybe, with a sandwich, a bag of crisps is consumed. It was not designed to shed light on the issue of obesity but in looking into it we asked people questions: "Are you overweight, underweight" etc., and when you compare those different categories of person Cadburys and Walkers found, versus the national average, obese people tended to be lighter snackers of what would you see as ----

Q801 Dr Naysmith: The only reason I am making this comment is that there is lots of research, particularly from the tobacco industry, and people consistently under-report the number of cigarettes they smoke.

Mr Glenn: That is a separate issue. When we were trying to work out our calculation of what were the calories that we would contribute in terms of the markets we worked in to the national diet, if you look at what people say they eat and you correlate that with what the industry shifts in terms of tonnages, there is an under-reporting. In the case of snack foods, it was by about 29 or 30 per cent. I think a similar position was found with Cadburys.

Q802 Dr Naysmith: I think it is a bit more than that.

Mr Glenn: The limitations of that data are understood. What you have is an indicative trend. It talks about occasions, not calories. It is not as black and white as we may think it is with respect to the obesity issue and how people are eating. It was quite surprising that obese people, relatively speaking, were lighter snackers of crisps, lighter consumers of confectionery, lighter consumers of breakfast cereals, than the national average. They were heavier consumers of things like meat, pies, eggs, bacon and take-away food. The fact is we have an obesity problem, so we are not walking away from that but it is not as clear as we may think.

Q803 Mr Burstow: This is self-reporting data?

Mr Glenn: It is, yes.

Q804 Mr Bradley: If people perceive themselves to be overweight, would they not be more likely to under-report what they perceive to be the snacking element that may be, in their mind, a contribution to their obesity? You would have that differential if people themselves felt that they were trying to tackle their own problem or reporting their overweight?

Mr Glenn: It is a hypothetical observation. Maybe. I do not know.

Q805 Mr Bradley: There was a makeover programme recently on the telly where they were trying to get this person to lose weight. She was nipping off to get snacks and pretending it was not happening. There was a sort of self-denial because she knew the whole purpose was for her to lose weight, because she was perceived to be overweight. You would over-compensate in that sense and not report what you actually were consuming.

Mr Glenn: That is speculation. If this were a report set up to understand the drivers of obesity, let us say, you may get that type of effect. It is not. It is a broad, market research tool which has been around for many years. People understand what they are doing. They are ticking off, collecting wrappers and scanning, to provide a general picture about what is being consumed. I do not think that psychology would apply in this case, but what Cadburys and we are saying is that it is indicative of a slightly more complex picture.

Q806 Dr Taylor: I agree with Mr Glenn that there has to be a common currency of energy intake measurement and it has to be the calorie. We cannot get confused with kilojoules and things like that. There is not any understanding. Even on the Committee, we had to ask this morning what is a normal calorie intake. I was very interested , Mr Hilton-Johnson, in your statement on your submission, "Improving menu choice to meet our customers' changing tastes". Has the addition of chicken select to chicken nuggets been steered by that? Is there an increased health value in chicken select rather than chicken nuggets? Are they less fatty? They are, I believe, pure chicken rather than minced up chicken. Is that a response to changing tastes or for marketing purposes?

Mr Hilton-Johnson: Above all, it is a response to changing tastes. There are on the market some chicken nuggets which are very different from the chicken nuggets that we sell. Chicken selects are premium, breast quality products and we will be moving to an all breast meat chicken nugget next year.

Q807 Dr Taylor: Are they less fatty?

Mr Hilton-Johnson: I am not aware, off the top of my head, exactly what the fat content of them is as compared with the chicken nuggets.

Q808 Dr Taylor: They are certainly bigger with less wrapping.

Mr Hilton-Johnson: They are bigger and you get fewer of them. I will get you the information.

Q809 Dr Taylor: Thank you. Mr Glenn, our experts have told us that the excess intake of calories worldwide is related to the increased consumption of carbonated drinks. You have already told us that the cola market is not growing. Is that just in this country or is that worldwide?

Mr Glenn: I am not sure what the worldwide picture is but the UK cola market is part of the carbonated soft drinks market, part of a broader market. The growth market in the UK is water, I believe, and fizzy drinks tend to be flat at the moment, with the exception of diet products. I think that is also true for the United States of America. Having worked for a while in Holland, where there does not appear to be the extent of the obesity problem that we are facing in the UK, it is quite interesting to see that the per capita consumption of things like crisps and snacks and carbonated soft drinks is pretty high; yet levels of obesity are much lower. There is something about the way that Holland works. People do seem to do more exercise. Okay, it is flat so it is easy to cycle, but just from speaking to Dutch people they understand more clearly than the average British person does this notion of the golden rule of calories in, calories out.

Q810 Dr Taylor: Can you give us a figure for low calorie Pepsi sales in this country as a proportion? You said it was increasing.

Mr Glenn: Yes. I am fairly new to understanding the Pepsi business as I have only just started taking control of it, but I know that for brand Pepsi, which is not brand Coke, which is a ten per cent share of the total carbonated soft drinks market, 60 per cent of what we sell is in diet variants. I do not know what the figure is for the Coca Cola company. I think it is quite high, but it is not as high as that.

Q811 Dr Taylor: Do you yourselves make any pure fruit drinks?

Mr Glenn: Yes, we make a brand called Tropicana which is a not from concentrate juice drink.

Q812 Dr Taylor: With no added sugar?

Mr Glenn: Nothing added, nothing taken away.

Q813 Dr Taylor: Is that the same with Oasis that you make?

Mr Cosslett: We do not make Oasis. That is Coca Cola. We sold our soft drinks business to Coca Cola six years ago.

Q814 Dr Taylor: Fruit shoots?

Mr Hilton-Johnson: They are with no added sugar. They account for about 17 per cent of drinks and we found interestingly that, when we move to semi-skimmed, organic milk as we did earlier on this year, sales went up by 48 per cent by changing to organic and changing the packaging.

Q815 Dr Taylor: Mr Glenn, the salt and shake crisps that have the salt separate in them: are sales of those going up?

Mr Glenn: Yes, massively. They are hardly a new innovation. I think they started in 1926 but we just happen to have forgotten about them. We represented the brand. We changed the brand name from Smith's to Walkers, which is the more contemporary brand. We advertised it and sales have absolutely rocketed, way beyond our expectations.

Q816 Dr Taylor: To all of you, I understand that the word "mature" in advertising terms means that the market is full. Is that the case with the products that you sell at the moment?

Mr Cosslett: The city keep telling us it is in terms of confectionery. It is pretty static. There are many ways that we can increase the value of the business for shareholders so there is no problem in delivering both agendas. The industry has been relatively static for a long time.

Q817 Dr Taylor: That is the confectionery side?

Mr Cosslett: Yes.

Q818 Dr Taylor: What about the others?

Mr Hilton-Johnson: There is some conflicting data about the informal eating out market. We are much slower than we used to be but any trip along a high street in Britain will show you that the number of eating out opportunities is growing. We can only assume that it will continue to grow but within that the amount of choice is growing even more than the number of outlets. The range of different foods you can buy for eating out now is much greater than it was even five or ten years ago.

Mr Glenn: The cola market is flat and not growing. The crisp and snack market is growing at about one per cent. The chilled, not from concentrate juice market is rocketing. The cereal and porridge market is growing very quickly as well.

Q819 Dr Taylor: What about breakfast cereals?

Mr Mobsby: Basically flat.

Q820 Mr Burstow: Could you tell us how many individuals are working in your company specifically on health issues and separately how many are working on nutrition issues?

Mr Cosslett: We have a science and research department. Part of their remit would have been the food safety agenda as a whole and there would be probably 20 people working in that in the UK. Recently, partly in response to the general concern in this area, we have put a team in place led by a lady social impact director, who reports directly to the chief executive. She has a global network of people in place now that is growing who have a large part of the responsibility for thinking about how we can not just develop nutrition platforms but, more importantly, get them into the market place so that they are commercially successful. Quite a lot of initiatives fail because they are well intentioned, but they do not deliver the market place the consumer needs. We have a growing number. We have always had in the UK a large number of people involved in food safety and nutrition within that and that is growing as we become more interested in this issue.

Mr Hilton-Johnson: We have a director of nutrition in the UK. Nutrition is dealt with through cross-functional teams who come together to review our menu items and new menu items. They are obviously supplemented by a nutritionist and advisers working with our suppliers.

Q821 Mr Burstow: And on the health side?

Mr Hilton-Johnson: We put them together.

Q822 Mr Burstow: And roughly, in terms of numbers?

Mr Hilton-Johnson: It is very difficult to say because the cross-functional team will vary. It is quite a large number of people who are involved in the process.

Q823 Mr Burstow: Are those people pulled out of other parts of the organisation to do this work?

Mr Hilton-Johnson: Yes, some of them.

Mr Glenn: As a global Pepsi initiative, we have an advisory board on health and wellness of 13 eminent nutritionists and food scientists, led by Dr Kenneth Cooper of the Cooper Aerobic Centre and Dr Dean Ornish of the Preventative Medicine Research Institute of California. They provide global guidance. They give advice on new product development, whether things are suitable for the trends that we are all aware of as a business. Within the UK as well we have access, albeit discreet, to four nutritionists and food scientists who give the UK business advice on product formulation of our new product range.

Mr Hilton-Johnson: I should have mentioned our global advisory council on nutrition which is made up of 13 people for different sectors from around the world, including a gentleman from Leeds University.

Q824 Mr Burstow: Mr Glenn, the two aspects you have described are both advisory roles outwith the company but working with the company. Do you directly employ any staff that deal specifically on issues around health and nutrition?

Mr Glenn: It is the same answer really that Cadburys gave you. Within our research and development organisation that issue is picked up.

Mr Mobsby: It is a rather strange question for us in some respects. I am not trying to be evasive. All of our marketing people have been exposed to nutrition considerations. We have dedicated nutritionists working within each of our businesses, either reporting directly to the general manager or in some instances in other areas. On a global basis, it would be unaffordable to fund primary research into many areas but on a global basis we coordinate our understandings and new learnings that are emerging in the areas of nutrition and nutrition science to try and pull that information into the business. It permeates our business quite considerably all the way through. Witness, we spend a lot of time trying to understand exactly what our foods do in the diet, as we try to illustrate in some of the information we provide.

Mr Burstow: Afterwards, if anyone felt able to give us any concrete numbers over and above the ones they have given today and any additional memoranda on that, that would be very helpful.

Q825 Chairman: Mr Hilton-Johnson, one of the issues that we have had raised with us is that at least one of your branches - I believe it is Paddington - has some formal links with the NHS whereby NHS staff showing their staff card can get some sort of discount, a medium meal for 1.99, normal price, 3.29. You can go large for an extra 30p. Is this a general arrangement with the health service or is it just a one-off that appears to have occurred locally?

Mr Hilton-Johnson: I am certainly not aware of it. I would suggest therefore that it is likely to be an initiative on a very local level, but I can certainly get the information for you.

Q826 John Austin: Can I come back on the question I asked earlier about promotional toys? I understand that one of your promotions was that people had to collect the parts to put together so you had to buy a whole lot to get the final toy.

Mr Hilton-Johnson: You are quite right. We did run one such promotion recently. It did not work very well and we will not be repeating it.

Q827 John Austin: Mr Cosslett, you said earlier on you were in the food industry whereas some of your colleagues in the confectionery business suggest that they are not in the health or nutrition business but they are in the pleasure industry. I wonder if you would like to comment on that, particularly in the light of your website which describes the position of Heroes as "tiny little bits of fun for everyone to share". Crunchie is "the fun, feel good chocolate" and Curly-Wurly is "fun for everyone". Do you see yourself in the food industry or in the pleasure industry?

Mr Cosslett: I think we see ourselves in the food industry, but we have a very specific role in the food industry which is to be a source of pleasure. It is generally known, and our research consistently endorses it over the decades, that confectionery is used to brighten people's lives. It is a shared product. 68 per cent of the products we sell are in a sharing format. It is designed to be a bonding, shared experience. Whether it is tubs of Heroes or Roses or a big family box which gets shared around the family, that is at the heart of what confectionery is. It is based on cocoa, sugar and milk, so not to call it a food would be wrong.

Q828 John Austin: I do not think any of us would deny that consumption is a pleasurable activity but do you feel you share some responsibility for the health consequences of the products you sell and for the obesity epidemic?

Mr Cosslett: No. I do not think there is any correlation between confectionery consumption and obesity. We are a very small proportion of the diet. Our own products account for something less than one per cent of what people eat. All the evidence suggest that people use our products extremely sensibly because of the issue of it being a known quantity. I think it is the unknown quantities which present the challenges. I live in Australia where confectionery consumption is half what it is in the UK. They have the fastest rising obesity rates in the world, despite their healthy image. The USA has far lower rates of confectionery consumption than the UK; whereas Switzerland has the highest confectionery consumption in Europe and it is comfortably down on obesity levels. There is no correlation. The market is fairly static and children, certainly in the last ten years, are eating no more. It really does not go anywhere close to explaining the huge growth that we are starting to see. We have to look elsewhere for the major drivers of that.

Q829 John Austin: All of us would agree that a good, healthy breakfast is a good thing and cereal is one of the ways of delivering it. You said added sugar gives you an immediate burst of energy because it does not have to be broken down in the way carbohydrate does. All the health evidence is that we are consuming too much sugar. Is there not an argument for reducing the amount of sugar in cereal products? You have accepted it for salt.

Mr Mobsby: Yes. We are seeking to reduce our salt levels. The evidence on the problems of salt and health issues is probably a lot better and clearer than the issue on sugar. I have not seen any issues that clearly demonstrate there is a link between sugar and obesity. Maybe there is some evidence I have not seen but I am not aware of it. We talk about pre-sweetened breakfasts but I think it is important to get it in context. We do a lot of analysis trying to understand exactly what we contribute in the diet. Pre-sweetened cereals contribute just seven per cent of the added sugars within the diet. In that context, there are a lot of other things that provide a lot more added sugar within the diet. Seven per cent, to me, is a low figure.

Q830 John Austin: Can I go on to the type of product that you use in manufacturing generally? It became quite clear to us in the United States that there is a massive government subsidy in manufacture to the sugar industry. Millions of gallons of corn syrup are produced which has to find a market somewhere. Certainly Coca Cola uses corn syrup exclusively as a sweetener. Is that true for Pepsi as well?

Mr Glenn: I would have to check the details but I would imagine that would be the case. I would emphasise that 60 per cent of what Pepsi sells in the UK is no sugar.

Q831 John Austin: Are there health issues in the way carbohydrate has to be broken down by the body into sugars which are further broken down? Sucrose also has to be broken down before it delivers the energy, whereas if you are using high fructose corn syrup you are delivering it straight to the liver, bypassing the bodily functions of breakdown. Are there health implications?

Mr Glenn: If we bring it back to the question of obesity which I thought was the term of reference of the debate, I do not know the answer to your specific question. There are a number of scientific theories bandied about on these things and you have obviously read something that suggests there is and I have not, but I am sure the Food Standards Agency would be well equipped to advise whether it were a problem or not. To come back to the notion of obesity, the simple message to people is the only way we will make progress and getting diverted about high fructose corn syrup and government subsidies may or may not be helpful.

Q832 John Austin: We talk about calories in and calories out. I believe you use palm oil in many of your products which has a healthy tag because it is vegetable oil, whereas it is mostly saturated fat, is it not?

Mr Hilton-Johnson: I do not know specifically about palm oil. I do know that we made a change which was broadly viewed as being positive to move to 100 per cent vegetable oil in our cooking processes. This question has never come up with me in this kind of context before and it has never been raised by one of our nutritionists. We do have different cooking processes in the UK as compared to the US. For example, we reduced trans fatty acids by 50 per cent in the UK a number of years ago. It is my understanding that they have not done that in the US, so we have changed cooking processes and the fat content of what we sell has gone down over the years. It is quite significantly less than it was, say, in the mid-1980s.

Q833 John Austin: What were the principal drivers that led you to move in that socially responsible way?

Mr Hilton-Johnson: I think it was changing customer tastes.

Mr Glenn: Clearly, there is a similar issue that applies to crisps and snacks. You are absolutely right. We use a blended vegetable oil called Palmolin which is relatively high in saturated fats. In the US they use a different oil which is high in trans fatty acids. If I refer you back to the submission and the data from the Pepsi Cola Report of 2002, there is a lot of innovation going on in cooking oils. In the US, there is a recognition that if you could reformulate the oil blends to reduce trans fatty acids it would be a good thing. At some considerable cost, the US changed its cooking oil. In the UK, Walkers is also reformulating its core brands. We have a low oil/low fat brand called Lites, which are cooked purely in a new oil called high oleic sunflower oil. It has a very similar fat profile to olive oil. It is very low in saturated fats. It is hard to get; it is very expensive and we have put it into a small part of our range but over the next few years we plan to blend it into the oil that we use with a target of reducing saturated fats by 50 per cent. You can question the motives. Why are we doing this? Because we think it is going to stand well with the consumer.

Mr Hilton-Johnson: I have just been informed that when we moved to vegetable oil it was not palm oil. It was rape seed oil.

Q834 Dr Naysmith: Earlier, we were talking about the need to put out a simple message about the potential dangers of some of the products you produce. I accept what was said about a balanced diet. All of you seem to agree that there is some merit in the idea of a simple message, even if it is only something like calories in, calories out and making sure that gets across more effectively. Yet, you all put out different messages in your marketing strategies, particularly in terms of portion size and super sizing. Recently, there has been a big concentration on buying a bigger portion and getting it cheaper and there must be a lot of temptation in that for people. That is clearly going in the opposite direction. Particularly to McDonald's to start with, super sizing encourages people to eat larger portions and academic research shows that. The cost is very little so in purely financial terms such offers are very hard to refuse. Could you tell us what your company policy is on super sizing?

Mr Hilton-Johnson: Super sizing accounts for two per cent of our sales. If you look at the average portion now as compared with 20 years ago, it is lower in calories and it is lower in fat because of a number of different initiatives, not one single thing. We provide very clear nutritional information to people, telling them exactly what they are consuming. We stress the importance of a healthy, balanced diet.

Q835 Dr Naysmith: I find it very hard to believe that it is only two per cent of your turnover.

Mr Hilton-Johnson: It is two per cent of turnover and four per cent of meals which are super size in the UK.

Q836 Dr Naysmith: When you are training staff, is there any attempt to encourage them to encourage customers to ask for a bigger portion if they ask for the standard size?

Mr Hilton-Johnson: Staff training is obviously very wide ranging but there are a number of things customers may be asked. They may be asked if they want their meals to be larger.

Q837 Dr Naysmith: That is part of the training?

Mr Hilton-Johnson: Yes.

Q838 Dr Naysmith: You encourage customers to ask for bigger portions?

Mr Hilton-Johnson: We encourage staff to ask questions and leave it to the customers to decide, making sure that they are fully apprised of the nutritional information.

Q839 Mr Burstow: When you apprise them of nutritional information do you at that point, when you are offering a larger portion, draw attention to the leaflets? Is that part of the training?

Mr Hilton-Johnson: It is not part of the training. The leaflets are available if people want them.

Q840 Mr Burstow: How do you draw attention to the nutritional issues at that point of decision?

Mr Hilton-Johnson: It is not about drawing attention at any particular point; it is about providing information generally that is available to customers so that they can make the decisions they want to.

Q841 Dr Naysmith: I have occasionally bought a hamburger myself but I have never been given any nutritional information.

Mr Hilton-Johnson: It is available should you wish to look at it.

Q842 Mr Bradley: A Big Mac would not be a super size meal. That would be an ordinary meal as opposed to a little Mac?

Mr Hilton-Johnson: The Big Mac does not change size. My understanding is that if you buy a Big Mac meal now compared to, say, 1984 it is quite substantially lower in its fat content and its calorie content.

Q843 Mr Bradley: That does not come into the category of a super size meal?

Mr Hilton-Johnson: That is just a meal. If you wanted to have a larger drink or larger french fries, you could do that if you wanted to.

Q844 Dr Naysmith: I wonder if any of the other members of the panel have any comment to make on pushing larger sizes? I know that Cadburys do that to a certain extent although I understand that their competitors, Mars, do it much more.

Mr Cosslett: A bit more but not that much more. We make a very wide range of sizes available. Most of the bigger ones are designed for sharing. With Christmas coming up, most people will have a tin of chocolates in the house for sharing and I think that is generally understood. I think the area you are talking about is the single bars. Again, three per cent of the confectionery market is in those products. I think the figure is slightly higher for Mars and is declining. They were introduced for a very specific audience, very active people in the late teens, who are pretty voracious consumers of most things. They fill that need. It is basically a high activity product. All chocolate has labelling that puts forward the calories, even though perhaps the labelling could be stronger, but they are always sold alongside other products of other sizes. People really have the choice of standard size, the larger one or a bag of buttons.

Q845 Dr Naysmith: I am surprised when you say that it is such a small percentage of the market and I will tell you why. If you go in to get petrol, there is a whole range of sweets on sale. King size is always there at least as much as the standard size.

Mr Cosslett: Service stations are very highly visible and we all go there but they are a very small part of the confectionery industry. It might surprise the Committee to know that half the sweet shops in Britain have closed in the last 25 years. Petrol stations are a relatively small part of the consumption and within that I think it is something like one in 25 people who go to petrol stations who buy confectionery. King size bars are their market. If you are trying to have a product which appeals to active, energetic members, they spend a lot of time in cars and going into petrol stations. That is the place where you will find them most of all.

Q846 Dr Naysmith: Presumably, businesses want to try and grow that?

Mr Cosslett: No, it is not designed that way. Our profitability on those products is lower.

Q847 Dr Naysmith: How can it be lower?

Mr Cosslett: Because we give away a much bigger chunk of chocolate.

Q848 Dr Naysmith: For an increased price.

Mr Cosslett: It is not necessarily the same. We are not inclined and motivated necessarily to sell king size bars.

Q849 Dr Naysmith: Kraft has recently agreed to issue smaller portions on a number of their products and they have said it is on health grounds. I wonder if any of you are prepared to follow them?

Mr Hilton-Johnson: I am not quite sure what Kraft have said or done so I would not wish to comment. From our perspective, we offer a range of portion sizes for people to decide themselves what they want. Increasing to a slightly larger portion is likely to have a comparatively small effect on the overall calorific value, even before you start thinking about questions such as diet and the fact that people come in two or three times a month. Therefore, it is going to have a very small effect on their diet. Also, a Big Mac at the moment is about 590 calories. If you buy, for example, a cheese and tomato sandwich from a leading supermarket retailer, you may find that that is 600 calories or 650 calories.

Q850 Dr Naysmith: All morning we have been arguing about the balance between calories in and calories out. There has been no disagreement that what we want to do is encourage people to take more exercise. Is it not reasonable to try to encourage people to eat a little less as well?

Mr Hilton-Johnson: It is sensible to encourage people to eat a healthy, balanced diet and if on occasions they want to eat more then surely that is okay.

Q851 Mr Bradley: Accepting your point that the market is relatively small, where you are selling the king size product in petrol stations, your target market is in a sense the most inactive market because they are eating a bigger product, sitting in a car or lorry, the out part of the equation is even lower and the in part is higher. You are contributing to that problem. Do you see any responsibility for redressing that by not encouraging people to buy big bars?

Mr Cosslett: There is a bit of an assumption there that people who use products in petrol stations are necessarily overweight or more sedentary than others. I am not sure that is proven. Our products are portable and you can eat them over a period of time. People do. If you look at most of our king size bars, they have the chunks and they are designed to be broken. A lot of our bigger products are eaten a bit and then consumed later, the next day. That is what people do because it is transportable and it does not go off. It does not get cold or hot but generally speaking the products stay around over a number of days.

Q852 Mr Bradley: I do not know if there is research on that and I may not be a good example but if you buy a chocolate bar you tend to consume it pretty quickly. If you have two Twix bars you do not save one and say you will eat it tomorrow. You eat the second one just as quickly as the first one.

Mr Cosslett: I understand your point but if you are offering adults at petrol stations an open range of products for them to choose from and the labelling says what is in them and they know instinctively about confectionery, that is their choice. It is a market that is a small part and it is declining. The value equation is one we may want to review. This thing about going from a smaller to a bigger bar and it being more attractive is something we could perhaps look at because it is not our intention to induce people by offering them an impulse purchase situation. I cannot talk for my competitors but I certainly think we could review that to see whether we should make it clear on the packaging that the role of it is for eating some now and some later to try and get over the current behaviour of eating it all.

Q853 Mr Burstow: Perhaps I can move on to marketing and sponsorship issues. I was looking at the table that was included in the Pepsi submission regarding the importance of companies to be socially responsible. I was struck by the quite significant shift in terms of consumers calibrating companies' social responsibility in terms of their decisions about whether or not to buy products from those companies. It has gone from 28 per cent in 1998 considering it very important to 46 per cent in 2001. I wonder if each of you could say a little bit about how much your companies spend on corporate social responsibility activities, perhaps split by sports, charitable work and local community activity in action? Could you give us an idea of the spend on each of those?

Mr Glenn: The MORI opinion poll company that did the research said this was probably one of the most significant shifts they had seen in social opinion in all their experience of polling. The reason we put it in our submission is that we are making the general point that it is in our interest, as commercial enterprises, to go with the grain of how consumers feel. As well as coming from a personal sense of obligation, corporate social responsibility makes sense. At the risk of sounding like I am avoiding the question, I cannot give you the detailed breakdown that you want here and now. Consumers, individuals, the voters, judge companies not on the basis of individual corporate and socially responsible programmes. Free books in schools have been important but corporate social responsibility starts first and foremost with the type of employer that you are, whether you employ responsibly. We seek to exceed government minima in terms of safety. We pay above average in the neighbourhoods where we work. We are one of the few businesses that have kept a final salary pension scheme going. That is the foundation of corporate social responsibility, which is how good an employer and neighbour you are. On top of that, we found the taking in of charity budgets away from the chairmen and putting them into the marketing departments resonates well with consumers. In the case of Walkers in the UK, we spent the equivalent of £7 million of retail value over the last few years in linking the purchase of Walkers crisps and snacks and books for 30,000 or so schools in the country. That is one of the biggest cause related marketing campaigns that we do. In addition, although I cannot describe the monetary value to it yet, we are a partner with the Football Association in terms of what we call the Youth Pillar. It is difficult with a lot of the submissions one is asked to fill in, in terms of the corporate social responsibility index, but we offer a lot of value in kind by allowing our employees to volunteer time. I do not know how you put a price on that. I guess you could in terms of time well spent but it is significant. I do not have the breakdown but I would be very happy to try and provide it to you. The key thing is if consumers thought we were offering them bad products at poor value, making them unhealthy and were trying to assuage our feelings of guilt by doing some of these high profile programmes, we would not get anywhere. The fact of the matter is consumers see Walkers, Cadburys and Kellogg's as pillars of the establishment with trusted brands and they respect that.

Q854 Mr Burstow: If you can supply the information later that would be very helpful. I think you have been able to send out seven million books so far. I wanted to get a handle on what that might equate to in terms of numbers of crisp packets. I was doing some number crunching and I may have got it completely wrong but I came up with a figure of about 1.2 billion packs being required to achieve those seven million books. Is that a gross under-estimate or an over-estimate?

Mr Glenn: The reason the scheme has been so successful is that it offers terrific value for money. Put yourself in the position of school teachers or school secretaries. They have a number of these schemes offered to them. The reason that free books have done so well over the years is that they offer pretty good value for money. We think there is a return of about 15 per cent. If a packet of crisps costs you, say, 20 pence, the value of a voucher for a typical book costs, say, £5 to buy and 100 vouchers will get you there, it is a pretty good return on investment.

Q855 Mr Burstow: On the figures I have seen it seems to be about 172 packs per book.

Mr Glenn: 100 tokens gets you a book of the equivalent cost of about £5. What schools have done over the years is traded up to more expensive books. The success of the scheme has been because it works for schools.

Mr Hilton-Johnson: I would agree entirely with your comments that social responsibility is not just about community activities. It is much more everything that you do as a company, your employment practices, your dealings with your suppliers, what you expect of them and their employees. It is your environmental record and so on. Community activities inform part of that. Last year, we published our first worldwide corporate social responsibility report. The spend for us is very difficult to quantify. I can try and provide you some information later. In our case it is partly difficult because it goes on in 1,200 locations throughout the country. We too have schemes with volunteering. There are two very important aspects of my company's community activities that I would like to draw to your attention. The first one I have already mentioned. That is creating 10,000 new community coaches over the next four years. That is an increase in accredited football coaches of 57 per cent over four years. You do not have to be a McDonald's customer to be coached in this way or to benefit. The other thing we contribute to are children's charities. That is responsible for something like 23 or 24 rooms and houses throughout the country where parents can stay when their children are sick or in hospital. Some of these are comparatively small. The largest has 65 bedrooms at Alderhey in Liverpool.

Mr Cosslett: Most people would recognise Cadbury as one of the companies that takes its social obligations extremely seriously going back to the 19^th century with the provision of housing for its workers. That spirit endures. Today, we have a direct financial contribution into charitable causes in the UK of over £2 million a year. The majority of our effort though is through our employee volunteering scheme. We now have 1,500 people in the UK engaged regularly, at least once a month, on community enterprises, many with schools. During our Get Active promotion, we had about 300 of those volunteers talking in local schools about five a day messages and the need for a healthy lifestyle and activity. We are out there, trying to push the right message. 1,500 people are involved in social programmes. We have a homeless sleep-out this weekend at St Basil's in Birmingham. Everyone is welcome to join in and it is something we take extremely seriously. It is something I am remarkably proud of for our organisation because these are ordinary people, giving up their free time.

We are a founder member of the Business in the Community movement, so it is an enormous part of what we do. We obviously take our environmental responsibilities way beyond what is required. In just about every facet of business we like to think of ourselves as the gold standard.

Mr Mobsby: Very similar to my colleagues here, whether it is in the areas of employment or environmental aspects, there are many of those, health and safety, the health of employers, et cetera. Perhaps the things you are more interested in would relate to activities within the community, as you describe them. We donate money very directly, particularly within the local communities in which we are based where we feel we have most influence. Also, the point others have made as well, one of the ways that we have been advised and found most useful is providing the services of our people, very often they may have money, they may not have the skills and expertise that our people can bring, so that can be provided on a regular basis and we do have people working in the community full‑time. Also the volunteer time that our own employees choose to focus on, particularly education. In terms of contributions we contribute about £1 million a year. From a commercial activity standpoint we contribute to Child Line, we have contributed about half a million pounds to that particular charity over time. We are involved in numerous other initiatives, Get Smart, which is a media literacy programme. There are many different facets to it.

Q856 John Austin: A number of companies in the food industry, including some of yourselves, associate products with sporting heroes and people in popular culture ‑ I do not want to get at Leicester City but Mr Lineker was awarded the ^ "Greedy Star Award" and the runner up was Britney Spears, neither of whom is in any way obese or even overweight. Is there an ethical issue about associating sporting heroes and popular culture heroes with some of the products you provide? Do you think there is an ethical issue?

Mr Glenn: We talked about it last week after the last session. I think if there were an ethical issue I do not think we would do it. What we try and do with advertising is we try and associate our adverts with popular people to make the adverts effective, that is what we try and do. Nowhere in our advertising, partly a matter of choice, but also partly because we are governed by a strict advertising code ‑ not just for the children but for all advertising ‑ we suggest if pop star X consumes a product you will become like the pop star. It is very, very controlled in terms of the association you make with the celebrity. If you look at Walkers advertising with Gary Lineker it does not encourage over‑consumption, it does not suggest you are going to be a sports star, it is just using a personality who happens to like our product, he is from Leicester, consumes the product himself and is very happy about doing that. It is part of a simple pleasure in life and that is what comes over in the advert.

Q857 John Austin: Do you think there is a difference in the way that adults perceive advertising and children perceive advertising?

Mr Glenn: We know there is. Psychologically children's cognitive and critical facilities are less well developed, that is part of being a child, which is why the advertising code for children is particularly strong.

Q858 John Austin: In what way are they strong?

Mr Glenn: Let me give you some examples, the draft global standard for regulating advertising to children is effectively based on the UK code, which should tell you that the UK code is very strong indeed. For example what it cannot do is it cannot suggest to children you should replace a snack instead of a main meal, you cannot suggest you eat it before you go to bed, it cannot suggest over‑consumption and it absolutely cannot suggest that you should go and ask your Mum to go and buy it. All those things are prescribed by the code.

Q859 John Austin: In the media strategy for Walkers Wotsits they talk about "Wotsits are for me ‑ I'm going to buy them when I get the chance and pester Mum for them hen she next goes shopping".

Mr Glenn: We looked at that two weeks ago, yes it was a brief, we looked at the advert, and I am sure you have, and in no way did it encourage pester power. There was no mother in the advert. The advert was approved by the ITC. We did not get any letters of complaint.

Q860 John Austin: Does that suggest the code is not strong enough?

Mr Glenn: There are two things at issue here, in the internal brief it was never our suggestion or intention to breach the code that was just a sloppy use of language. We apologised once and we apologise again if it helps. The advert was approved by the ITC, as all of our adverts are, and we did not get any letters of complaint.

Q861 John Austin: Would all of you accept that some of your marketing and some of your advertising is specifically aimed at children?

Mr Mobsby: Yes.

Q862 Mr Burns: I just wanted to ask Mr Glenn on pestering, is it not a fact in the real world that children pester their parents on everything, whatever they want they pester their parents? Is that not the reality of the situation and it applies as much to soft drinks and to fast food as it does to sweets, as it does to the latest toy or it does to the latest fade in the school playground?

Mr Glenn: I think it is part of being a parent. Mr Cosslett put it over very well, it is part of life. It is also not correct in advertising to encourage constant pestering, the irritation of a product, and that is what we do not do and did not do in our advert.

Q863 Mr Burns: I understand the code. You can have as many codes as you like or as many pieces of paper but is it not a fact of life that children rather annoyingly pester their parents constantly if they want something?

Mr Glenn: Children are the best negotiators in life and we are conditioned as we get older not to be as good.

Q864 John Austin: What would your reaction be to a recommendation or a suggestion that there should either be a ban or limitation on advertising during children's viewing time on television, or if there was a code similar to that which I think exists in the Netherlands which does not allow children's television personalities to be associated with products that may be advertised for children? What would your reaction be to those proposals?

Mr Mobsby: I can start with that one, we at Kellogg's would have a serious problem with the suggestion that advertising for children are banned. There are three reasons for that, one is, I think if we are honest it would be probably be impractical and ineffective. What we do know is that children watch a lot of other media and are exposed to a lot of stimulants rather than television advertising during children's television hours. I do not think there is any real evidence that it would have any impact. If we look at Quebec and Sweden where advertising bans are in effect the incidents and the rate of obesity in children is just as high as it is else where. A second consideration, and quite honestly this one relates to commercial business, if we were to ban advertising to children on breakfast cereals, which is what the effect of that would be, we would have to think through what the consequences might be. What will children do instead, will they stop eating breakfast, which is quite possible, or reduce their consumption of breakfast, make it less frequent? Will they shift to other types of breakfast which might have higher levels of fat and low levels of other micro nutrients? I am seriously concerned if there were a ban on advertising for children as far as it pertains to our products, and I can only speak to our own product. The third point, advertising can be used as a force for good and I would encourage us to think about it in those terms. We talk about the education and the importance of getting a message across, we can start with children, obviously it also involves mothers, I would be far more interested in trying to engage in a discussion about how we get positive messages into our communications directed at children.

Q865 Mr Bradley: Can I come in on that and go back to the point about pester power. There was recently an advert for Kellogg's in Manchester, my area, for a senior consumer researcher for kids' brands. If I can read the first paragraph of the advert, ^"Coco‑Pops, Fruit Winders, Cereal Milk Bars and Frosties are some of the brands you need to get under your skin in this role. You will spend your time understanding kids, finding out what interests them and establishing which other brands they associate with and appreciating the realms of pester power". Do you think that is a reasonable way to promote a job in this area?

Mr Mobsby: I do not. I think it is unfortunate that the phrase "pester power" has got into common parlance, I do not think it is helpful. I do not think it is appropriately used in that context. One of the most frequently asked questions when a mother goes shopping and the kids do not go is, ^ "what cereal do you want me to buy?" In relation to that we have no evidence pester power is a major issue.

Mothers are actually more interested in knowing that the kids will actually eat the products they are going to buy, that is the bigger concern. I think that use of language is unfortunate, it should not be used in our companies.

Q866 Dr Naysmith: You were talking about the effects of banning advertising and you said that where it had happened there was no evidence that it had any effect.

Mr Mobsby: Yes.

Q867 Dr Naysmith: Then you went on to say that you had worries about what might happen if advertising was banned and kids might not eat breakfast. I do not see how these two things can be reconciled, particularly the first one. If it has no effect why is the industry spending millions of pounds?

Mr Mobsby: What is not having an effect? I do not understand your particular point.

Q868 Dr Naysmith: The advertising of your products on television at children's viewing time.

Mr Mobsby: I do not think I have said that advertising our products does not have any effects.

Q869 Dr Naysmith: What you said was it had no effect in those countries it has been banned.

Mr Mobsby: I said there had been no effect on the incidence of obesity. I am sorry if I was not clear on that point. If you look at the rising incidence of obesity, it is as high in Quebec, Canada, as it is in the rest of the Canada and it is a similar situation in Sweden.

Q870 Dr Naysmith: If withdrawing the advertising has no effect on obesity, why does it have an effect in terms of promoting eating breakfast?

Mr Mobsby: We do not know is the honest answer what the effect will be. We have not got examples that clearly demonstrate that. We tried to answer the question in Canada to illustrate what was going on but the information was confusing and we cannot see what actually happened, so we do not know.

Q871 Dr Naysmith: We need to let it run for a bit longer until we can assess it.

Mr Mobsby: Canada, Quebec, has been there for about 20 years and we are all able to read it but the information is confusing. I think what I am flagging is we need to understand what the knock-on consequences will be. When I talk about that in relation to the cereal category, which is the one that I can understand, so I know why we advertise to kids, I think we have a reasonable understanding of what it does. If we were not to have that capability I think there is a probability over time that the consumption of cereals would actually drop, the consumption of breakfast might well drop. We need to understand that because that is not necessarily a positive step forward; in fact, quite the reverse I would suggest.

Q872 Chairman: Can I just raise one point about the issue of sports sponsorship that has been referred to. McDonald's are very heavily involved with football and I think Mr Glenn's company as well has links. I had the company of Bertie Bassett on Saturday evening at a rugby international, 13 aside, proper rugby. What I am interested in is these are the kinds of sports that do involve a significant number of people, not the majority of people. What about the involvement of your organisations in the sponsorship or encouragement, I should say, of things like walking and cycling which perhaps most people would gain more from than the more active sports that you are associated with?

Mr Cosslett: This is something that our business has been trying to do recently. I could take you right back but we probably do not have the time. We have had a long history. One of the things that we did as part of our Get Active campaign, which unfortunately was not publicised, was the event days that we held for thousands of kids and their parents to come along and try new things. We had one at the NEC in Birmingham when 14,500 people turned up, 6,000 of them children. We got a lot of different activities to come along and let the children try out different sports. It was not just sports, we had dance classes, we had the Rambler's Association there, a wide range. Lots of people do not like sports, cannot do sports, but the general issue of activity is crucial. Therefore, we tried to do that within the Get Active programme but, unfortunately, as I say, we did not get the publicity we would have liked. We did it again in Wrexham in Wales two weeks later, we had another great turnout. It was a really good example of how you can actually mobilise children and their parents to get excited about activity. That was their first brush with it. I heard yesterday - this was new information to me - one lad who turned up and tried the rowing was considered by the coach there, who was running the day, to be Olympic standard. That was just a lad who turned up, which is tremendous. We do actually get some very, very positive ----

Q873 Chairman: So you have tried to do something along those lines.

Mr Cosslett: That was one example. Going forward, one of the ways we might take our activity programme on next year is to actually look at giving people the opportunity to win prizes which will get them into these clubs and associations which will get them directly into sports and exercise of all types. We will build on that, that is one of our ideas.

Mr Glenn: Could I add something to that?

Q874 Chairman: Yes, of course you can.

Mr Glenn: Two things. We are aware of those issues. We are not going to get sustained tackling of the obesity issue by sports stunts either. I think you probably saw Dr James Hill with America on the Move. That is basically lots of small steps, literally and metaphorically.

Q875 Chairman: We were very impressed by what we saw.

Mr Glenn: I was on the phone to him last week. He is very keen to see how it would work in Europe and he is going to come over and talk to us. That would be one of the initiatives - Mr Burstow has gone now - which the larger food and drink companies might co-operate on. I think the importance of that one is that can form part of your lifestyle. I think getting someone to play sports suddenly after years probably is not healthy, let alone practical, where do you go, etc?

Q876 Chairman: There is a possible danger, the departure to play sport would be unusual.

Mr Glenn: We looked at cycling because there has been quite a lot of work being done, would it not be good to get kids cycling again, but I would not touch it with a bargepole. I do not let my kids go out on the roads and cycle, I think the roads are too dangerous. As commercial businesses we cannot afford to put ourselves in harm's way either. Yes, the America on the Move thing, small changes to one's lifestyle that are sustainable, is the solution to obesity.

Q877 Chairman: So you are actively looking at the America on the Move model?

Mr Glenn: PepsiCo is the headline sponsor of America on the Move in the US, so through that link we have spoken to the people concerned. There is an academic at the University of Glasgow who has got a particular interest in this field who is keen to get sponsorship for doing some form of assessment study, although I am not sure you need one by the way. That kind of issue is great. It is what we are good at, we touch lots of people and it goes to the grain of how people live their lives rather than saying you have got to have a revolution in your lives, which will never work.

Mr Mobsby: If I could add to that as well, if I may. I absolutely agree with you, it may be that the jump to competitive sport is too big an ask. You have got to bring it down to a level that is more accessible. We have got some work going with the Amateur Swimming Association involving kids, which is basically trying to get them swimming in the first place and then they can progress beyond that. We are also interested very much in walking and the Colorado on the Move and America on the Move initiatives are things that we have been associated with in the US. Without giving competitive secrets away, I hope we might soon have pedometers here in the UK courtesy of Kellogg's.

Q878 Chairman: We are all wearing them round the table.

Mr Mobsby: We have also commissioned, and we would be happy to share the results of this when we have got it, some research through Loughborough University on walking specifically to try and understand that particular phenomenon and how people relate to it, etc. That is something that we would be more than willing to share.

Mr Hilton-Johnson: We are very proud of our community football programme. It is very big and it has won the backing of the Sports Minister. Football is very big in the UK, it is the fastest growing female sport, I understand. Obviously, as a company we need to concentrate our resources in one area and make sure that we do that well rather than try and spread ourselves too widely and too thinly. We are about to start talking to our employees about a healthy, active lifestyle. We are, in fact, organising a big three peaks challenge next year in Yorkshire and we too may have some pedometers on offer next year. I think the Chairman is absolutely right, the broader that we can spread a healthy, active lifestyle message the better. I think what may be underlying your question, if you will forgive me, is can companies play a role in communicating key government messages here, and the answer to that has to be yes.

Q879 Dr Taylor: I think we are all delighted to hear these rumours about step counters because we are completely wedded to them and it would seem so much more sensible to put those into a packet of Kellogg's than some of the promotional toys that you do. Going back to McDonald's, with promotional toys can you see the effect of a particular series of toys on the market; is it obvious which are working?

Mr Hilton-Johnson: When we sell Happy Meals there are clearly some food and drink products that sell better than others and there are some toys that sell better than others.

Q880 Dr Taylor: I gather from your information that in fact you can substitute a packet of fruit for fries on the Happy Meal.

Mr Hilton-Johnson: Yes, you can.

Q881 Dr Taylor: I do not know if that is promoted in any way?

Mr Hilton-Johnson: It was very heavily promoted last week.

Q882 Dr Taylor: I actually went to a McDonald's last week ‑‑‑

Mr Hilton-Johnson: We have promoted it over time, we are continuing to promote it. The promotion started off slowly because at the time we had changed some other things compared to our Happy Meals. We felt that the communication to customers was a little too much but we are ramping that up. We are finding more and more people do take that up.

Q883 Dr Taylor: It certainly was not noticeable where I went last week. Would you ever consider using the toy as a reward and putting the toy in a Happy Meal with fruit but not in a Happy Meal with French fries?

Mr Hilton-Johnson: You can do that in any event. I am not sure, I think you can substitute the toy for French fries.

Q884 Dr Taylor: I do not mean that, I mean marketing the Happy Meal with a toy and fruit but not putting the toy in with the French fries to give the kid a reward for having the fruit?

Mr Hilton-Johnson: Of course it is something that we can consider. What we are doing with effect from December is that alongside the toy we will only be promoting fruit not French fries and chicken products. That is what we have decided from December this year.

Q885 Dr Taylor: You will be doing it.

Mr Hilton-Johnson: I am not sure exactly what the question is but our promotions from December this year will involve a toy and chicken and fruit but not French fries.

Q886 Dr Taylor: Excellent. If you have French fries you will not get the toy?

Mr Hilton-Johnson: You can have them if you want I am talking about the way it is promoted. The Happy Meal will still be the range of options that it currently is at the moment.

Q887 Chairman: Why not have a positive promotion of toys with healthier food?

Mr Hilton-Johnson: That is certainly something that we can consider.

Q888 Chairman: You would consider it.

Mr Hilton-Johnson: We could consider it, yes.

Dr Taylor: It would be a very positive step if it worked, getting kids to eat fruit rather than fries, if it worked!

Q889 Mr Burtsow: Could or will consider it.

Mr Hilton-Johnson: We absolutely will consider it?

Q890 Mr Burns: Mr Hilton‑Johnson, there has been considerable press coverage and public interest about attempts in the United States to sue you and other companies in the food industry on the grounds that you are allegedly held responsible for people's weight conditions and they have all been unsuccessful. As we know in America you can sue somebody for almost anything and be successful. You may be aware there are groups of lawyers meeting trying to work out how to pursue a successful action against food companies, operating on the basis that they will at some point somewhere in the United States find some judge who will not throw the case out and let it be heard. Can you inform the Committee what the current situation is and the latest news on these developments?

Mr Hilton-Johnson: These developments are entirely in the US and I cannot speak for the US company I am afraid. I think we are all aware that the US has a very different litigation culture, thank goodness, or rather that the UK is different to the US. The law suits to which you refer were thrown out by the judge at a very early stage, we believe they were without foundation and that it is wrong to target specific companies in the way that was happening. We believe fundamentally that it is wrong because it simply miss‑informs the debate. There is an obesity problem in the US, we all know that, suing particular companies does not advance the debate at all.

Mr Burns: Thank you.

Q891 Dr Taylor: We have mentioned health warnings briefly already, can I just come back to them a moment, would you consider, the people who make crisps, putting a health warning on full fat ones and a very big notice ^ "healthy option" on the light ones, would that be feasible?

Mr Glenn: It would be feasible but I think it would be disproportionate and potentially falling into the trap again of not giving the holistic picture about the total diet. On our packs of crisps we have full nutritional information, the big eight, how much fat ‑‑‑

Q892 Dr Taylor: You do but it is in pretty small print and difficult to interpret sometimes. Again coming back to common currency, if there was just a simple large message about the number of calories comparing that with the fat free ones would that not be worth putting on?

Mr Glenn: I keep an open mind to this whole question about labelling and we have been a genuine pioneer in it to be honest. Why would you just look at certain specific food types that are a very small percentage of the diet and not ask that question of everything?

Q893 Dr Taylor: We are trying to approach that for every item of food from the point of view of labelling. It is a tremendous problem of life, as you have already said, that junk foods are so popular ‑ sorry to call them junk foods.

Mr Glenn: I am sorry too.

Q894 Dr Taylor: They are extremely popular and there is a huge problem there. That is why I think some sort of better labelling even implying a health warning would be helpful.

Mr Glenn: Just on certain food types that you define as junk or across everything?

Q895 Dr Taylor: I hate to bring it up but ^ Public Health News has produced a table, the JP Morgan ranking of the percentage of not so healthy food and a percentage of better than plus healthy food. Cadbury's does not come out very well on this, Kellogg's comes out better but there are understood categories of not so healthy foods and better than plus healthy foods and it is the not so healthy ones that should have the warnings.

Mr Glenn: I think if you go back to first principles here the big step forward we can make in the combating of obesity is simple messages about total diets, calories in and calories out. Heaven help us if we are being guided by a US investment bank to categorise our food, I would rather have it from a nutritional, medical point of view than a financial point of view.

Something Mr Cosslett from Cadbury's said is very important, most consumers do understand

 

that a bag of crisps or a bar of chocolate, etc is naughty but nice and should be consumed in

 

moderation, I think they get that. There is an opportunity to make people understand in the

 

totality of food that they consume where the calorie load comes in.

Q896 Dr Taylor: Do you think that still exists? I know when I was brought up some time ago sweets were very much a luxury and you were told by your parents, one after meals and that was it. Again on Cadbury bars should there be any maximum number that you should eat in a day?

Mr Cosslett: One after every meal I could take that.

Q897 Dr Taylor: Would there be any advantage in that?

Mr Cosslett: Perhaps I can say something, I think health warnings are for dangerous things. Whilst we recognise the problem I do not think that a Curly Wurly is a dangerous thing.

Q898 Dr Taylor: In excess it probably is.

Mr Cosslett: So are bananas. In excess anything has the potential to cause disturbance. I too take exception with the junk food term. Chocolate has many nutritional benefits which are now receiving increasing coverage, including letters in the ^ Lancet not too long ago stating that chocolate is one of the highest forms of naturally occurring anti‑oxidants, greater even than red wine, which is very good. It has 20 per cent of the recommended daily intake of calcium in an average size bar, 12 per cent of iron. I do not call that junk food, I call bad diets junk diets. That is where we should arrive at. The concept of using health warnings on products that are totally safe, wholesome and have been enjoyed for very many years and are a known quantity is totally disproportionate.

Mr Glenn: Could I add something. In the spirit of proportionality and evenness, would you consider health warnings on tv programmes and video games, excess playing in front of the PC, etc.?

Chairman: We would, we are all health fascists.

Q899 Dr Naysmith: Would the panel consider that it would change its views at all because in the research we have come across in this inquiry that fast foods or unnecessary snacks, if you would like to call them that rather than junk food, compose a much higher proportion of the diet of poorer sections of the population than higher income sections of the population?

Mr Glenn: Crisps are consumed pretty widely by the population. There may well be a slight bias towards the less ----

Q900 Dr Naysmith: It is more than a slight bias. There are figures that show that there is a significant bias.

Mr Glenn: Let us not argue about the data; let us argue about the trend.

Q901 Dr Naysmith: If you are badly off then it is a much higher proportion of your diet.

Mr Glenn: I was just referring specifically to the categories I am responsible for. The general point is important and then it comes down to the importance of education. The other thing that I might add, if I could, is if we refer to things as "unnecessary snacks", and again do not go with the grain of how people are living their lives with lots of mothers working nowadays, the break down of mealtimes, and we look back fondly to a point in time when children said "please" and "thank you" and had three meals a day, it is not like that any more.

Q902 Dr Naysmith: I understand how society has changed but you spend millions of pounds every year advertising to try to get people to eat this sort of thing. If you did not do that then there would be fewer snacks consumed surely.

Mr Glenn: I thought we had covered that argument.

Q903 Dr Naysmith: We covered that earlier but we are coming back to it. It was you who brought us back to it.

Mr Glenn: Then I have happily served my purpose for this Committee. The fact of the matter is that food and drink advertising as a potential of total advertising has significantly decreased in real terms.

Q904 Dr Naysmith: I cannot quite hear what you are saying.

Mr Glenn: Sorry. The fact of the matter is that food and drink advertising as a percentage of total advertising over the last 15 years has decreased in real terms quite significantly. You have to put that bit of data into the understanding of the question, which is if that is the case why has there not ----

Q905 Dr Naysmith: You are saying that advertising has decreased over the last 15 years?

Mr Glenn: In real terms it has decreased because there are so many more categories advertising. The Government spends £140 million a year; banks advertise more than they ever used to. Yes, as a proportion and the number of impacts, it has decreased.

Q906 Dr Naysmith: As a proportion that is relative. The amount of advertising has not decreased.

Mr Glenn: With respect, the relative point is very critical because the consumer's capacity to store and remember messages is pretty finite, so the relative share of voices, as we call them within the industry, is a significant factor. If you just take it as read and it is correct data that the relative impact of food and drink, and within it the kind of categories that we represent, has gone down, then had it been ----

Q907 Dr Naysmith: I am not saying it is the only the reason, obviously people are better off and they have more money to spend on these things, but it must have a significant effect otherwise you guys would not spend so much money on it.

Mr Glenn: We are commercial businesses and we like to think we spend money for a point. I guess the critical point in markets like ours is it seems to have more of an effect on driving individual brands than it does the total market. It is very difficult to create new demand. Advertisers and marketeers go with the flow of how consumers live their lives.

Q908 Dr Naysmith: I am not sure about that. I think there is a lot of evidence that you can create new demands.

Mr Cosslett: I would just like to make one point of clarification so it is on the record. The consumption of confectionary, for what it is worth, completely mirrors the national income groups, all of the social demographics, and as far as this organisation, this business, is concerned that is not the case.

Q909 Mr Burstow: Can I pick up Mr Cosslett's point earlier on about we do not have junk foods, we have junk diets and go back to what you were saying to us earlier on in reference to your own concern about a pot of yoghurt that you consumed that was far worse than you were led to believe by the labelling. Do you not think that lesson you draw from that yoghurt pot and what it said to you, and how it misled you, is not something that we should try and make sure is a general lesson that we try and apply to all food products?

Mr Cosslett: I think misleading claims on labels should be dealt with. I think that is the job of the food industry to go and fix. We have been making progress on that as an industry but there are still ways that people claim fat free this and sugar free that. One of the reasons why we have not been in a rush to do sugar free chocolate is because the actual calorie content stays the same. We are struggling with that issue of how you make it clear what the difference is. We treat it very, very seriously because there are people being deluded on a daily basis about what they are buying and they do not know. That extends to products which are generally healthy, I know, but still have high calorific values.

Q910 Mr Burstow: Presumably the producer of that yoghurt could be here today and could say there is no such thing as a bad food and that food could be part of a balanced diet.

Mr Cosslett: Correct.

Q911 Mr Burstow: If they could say that how could I as a consumer purchasing that product, how could you as a consumer purchasing that product, come to a view as to whether or not it should be one a week, two a week or none a week? How do we make those decisions?

Mr Cosslett: I think there is a difference in the understanding of product categories. Most people would think of yoghurt as a generally healthier category. The very great majority of people understand that confectionary is a treat and that is a conscious decision. Yoghurt, you would assume, has a certain health profile and when you see a low fat yoghurt with a clear statement drawing attention to the fact it is low fat, you would be doubly convinced and it would reinforce your instinct that this is a good food product, it is only when you get it home and examine the calories that you find it has got 200-plus calories in it, which was a surprise to me and I have been in the industry for a long time. I do think we need it to be very simple. As we said right at the start, I think some general collective ability to work on better and more simple labelling would be great, but it does not just affect the prepacked industry and packaged food industry, with respect, 40 per cent of the food that is consumed in this country has no labelling on it whatsoever, and that is growing, it is doubling in size every ten years. That is where we could make a very important start. It is difficult because it means you have got to get to the fish and chip shops and you have got to get to the pubs and you have got to get to the burger vans and to Indian restaurants. That is where the food market is expanding rapidly. If you look at the latest Neilson figures, that is Neilson syndicated data for the food industry, I think it shows we have got some really encouraging signs in what people are buying. The sales of fruit and vegetables are up double digits for the last two years. Sales of low fat ready meals are increasing. I think the messages are starting to work, five a day and things like that, but it needs to be a universal approach rather than just taking on the grocery industry.

Q912 Chairman: On your yoghurt example and the point about simplifying labelling, I agree with what you were saying. We established earlier on this morning that the energy in, energy out issue is crucial. I got the impression, Mr Hilton-Johnson, from your answers that you would need to make the message clearer in relation to calorific content and energy output, etc. How would you feel about some kind of simplified labelling along the lines of high energy dense, medium energy dense, low energy dense, to pick up the point you were making a moment or two that this needs to be simplified and consistent? I accept the point you made that fish and chips would come into it, etc., but how do you feel about something along those lines that would simplify it and make it consistent?

Mr Glenn: I am all in favour of simplicity but not being overtly simple. From what we have learned about low fat diets over the years, and high fibre diets before that, you can get fat on a low fat diet, you can get fat on a high fibre diet. The risk you run is if you do a traffic light system, which thinking about what you were saying it looked like that, you would get too simplistic a message, that people can over-indulge in anything and get fat. I come back to the common currency that we could do with educating about what is the calorie, give people that information and let them then work out the rest, hopefully within part of a unified approach to education in this area, which is clearly lacking which is why we have got the problem that we have.

Q913 Chairman: Would that view be the general consensus amongst your colleagues?

Mr Mobsby: I would say exactly the same thing. The notion of trying to define foods, I am not sure how the consumer can use it. At the end of the day we have got to make this helpful, informative and meaningful for them. For me, calories would be the logical place to go. If we bear in mind that the calorific density of fat is much higher than carbohydrates, if you use calories you are automatically going to be sending some other messages as well that will potentially lead to reorientation. I think calories is a basic good indicator and if we can keep it at something simple like that, which may also transfer across when we think about energy expenditure, so we have got that thing that can work on both sides of the equation, I am far more inclined to believe we would have something simple that people can get to grips with.

Mr Hilton-Johnson: We are agreed it is complex and there needs to be a simple solution and a consistent solution. Whatever solution is implemented ‑ and calories appears to be as good as any in my mind when dealing with the restaurant sector ‑ the information has to be provided before the point of purchase. It is no good if you find out that your chicken meal or your beef meal contains X amount of calories when it is sitting in the plate in front of you.

Q914 Dr Naysmith: I wanted to clear up something with Mr Glenn, the suggestion is that there is evidence to suggest that advertising for fast food has increased enormously over the last 10 years, there has been a huge increase in that. The second point is that amongst children's advertising food advertising is dominant and has been for the last five decades ‑ I imagine that is not true in the period up to Christmas, there will be something else taking over children's advertising.

Mr Glenn: I do not dispute that. We do not categorise ourselves as the fast food industry, our categorisation would be the prepared food industry, and the two statements cannot be compatible.

Chairman: Mr Amess apologises for leaving early, he says if you leave any free samples could you leave him some as well. You have promised to come back with a few points. Thank you very much for your time.