Ministers have been urged to consider ending the public subsidy of milk for primary school children in Britain.
The subsidy costs £5m a year
A study for the government by London Economics said milk could be bought more cheaply in supermarkets.
And it questioned the health benefits from the subsidy, which is funded jointly by the EU and the UK.
"While many products are helpful for children - such as toothpaste and toothbrushes - schools do not typically offer them for sale to pupils."
A spokesman for the Department for Environment, Food and Rural Affairs said the report would be carefully considered.
The dairy industry said ending the subsidy would be bad for children.
And the Liberal Democrats accused ministers of "snatching" school milk.
This was a reference to the "milk snatcher" nickname acquired by Margaret Thatcher when, as education secretary in the 1970s, she ended free school milk for older pupils.
But the British Heart Foundation said it would be better for children's health to subsidise fruit or bread.
The London Economics report said a mark of the scheme's "inefficiency" was that the average price schools charged parents for subsidised milk - 11.4p for a third of a pint - exceeded the supermarket price for milk which was not subsidised - 8.4 to 10p.
"Supermarket milk and school milk are similar goods; the health benefits of drinking each are identical."
The Welsh Assembly adds to the EU subsidy to make milk available free to children in reception classes and the first two years of primary education.
A recent report from the Milk Development Council said 2005 was set to be a record-breaking year for school milk, with over 40,000 more children taking it in primary and nursery schools throughout Britain thanks to its School Milk Project.
In 2006 the project intends working in with the Health Education Trust to promote healthy vending in secondary schools.
New recommendations from the government mean that, from September, the only drinks available in vending machines in secondary schools in England should be milk, water or fruit juice.
A separate report published on Wednesday by public sector union Unison said the take-up of school meals had fallen as prices rose.
It said children from less affluent homes may not be able to afford school meals if prices continued to rise.
A union survey of local authorities found the average cost of a meal in a school canteen had increased by 44% during the last 10 years while retail price inflation had been only 16%.
"If the prices continue to rise at this rate the reform of the service will be self-defeating as those who need it most will miss out," said Unison's Christine Lewis.