THE tobacco industry’s unprecedented visit to Taoiseach Enda Kenny and his ministers Michael Noonan and Alan Shatter would appear to have been a failure.
Earlier this month a group representing authorised tobacco distributors went to government buildings to lobby, among other things, for a crackdown on tobacco smuggling. While their argument was based on self-interest – they want to protect against revenue and profit loss — it appealed to the Government’s self-interest too — black market sales denies the state enormous levels of tax revenue.
Interestingly they linked the issue of tobacco smuggling to something else that worried them: Government plans to follow the example set in Australia where it recently decided that all cigarettes must be sold in plain packaging, without logos or branding. This, the industry believes, makes life much easier for the smugglers: they no longer have to go to the expense or trouble of copying the packaging of branded products if they can just lump the cigarettes into plain packs.
Fianna Fáil leader Micheál Martin — the man who introduced the innovative ban on smoking in the workplace, his finest act in politics — fulminated about the mere fact of Kenny and his ministers meeting with PJ Carroll chief executive Steven Donaldson, Japan Tobacco International boss John Freda and John Player chief executive Andrew Meagher. He alleged it showed a “fundamental lack of judgement” on Kenny’s part. He does not like to convey respectability to the industry, despite the vast amounts of money its products contribute to the exchequer each year.
The meeting was organised by Kenny’s friend, the popular TV sports presenter Bill O’Herlihy, a man recently appointed by the Government to the position as chairman of the Irish Film Board. He is also adviser to the Irish Tobacco Manufacturer’s Advisory Committee and gives the industry some of the respectability that Martin would deny it. O’Herlihy’s public relations company recently withdrew a claim on its website that it acts as an adviser to the Government, something it is prohibited from doing if it represents the tobacco industry. The website claim was attributed to a mistake by an over-enthusiastic casual employee.
O’Herlihy had lobbied the Government before the last budget not to increase the price of cigarettes. He argued that “excise increases merely generate greater sales for illegal cigarettes”. He also argued that “Ireland, with the most expensive cigarettes in the EU, is fertile ground for criminals who trade in smuggled cigarettes”. A 10 cent rise in the price of a packet of cigarettes was implemented nonetheless, although such a small amount might have been described best as a gesture. Kenny and his ministers were not too impressed by the latest arguments from the industry it seems. On Tuesday the Government approved a decision to follow the example of Australia in banning branded cigarette packaging, much to the horror of the manufacturers. No trademarks, logos, colours or graphics will be allowed on the packaging.
This is largely the work of Health Minister Dr James Reilly who was not present at the meeting with the lobbyists. He claimed the measure would “remove the final way for tobacco companies to promote their deadly product in Ireland… Cigarette packets will no longer be a mobile advertisement for the tobacco industry.”
It seems to be personal for Reilly: his father suffered a stroke that left him blind for 14 years and his brother, a doctor, died of lung cancer. It is estimated over 5,200 people die in Ireland each year due to tobacco-related diseases. Reilly regularly cites the estimate that one-in-two of all smokers will die from their addiction. Like Martin before him Reilly seems to find it easier to crack down on smoking than solve the other problems of the health sector.
That said it seems like an intelligent preventive measure that will keep people out of our hospitals in the future.
Reilly believes that to replace the smokers who quit, the tobacco industry needs to recruit 50 new smokers in Ireland every day just to maintain smoking rates at their current level. “Given that 78% of smokers in a survey said they started smoking under the age of 18, it’s clear that the tobacco industry focuses on children to replace those customers who die or quit,” he said.
Reilly is taking his cue from the theme of today’s World No Tobacco Day, which is to ban tobacco advertising, promotion and sponsorship (although not the product itself. Given the failure of prohibition this seems a sensible approach).
Reilly has quoted research that shows packaging has been used effectively to reassure consumers about the risks, for example with the use of the words “mild” or “light” on packs in the past, and that imagery and colours also influence consumers. Pack, shape and design are central to inducing new smokers. Apparently the “lipstick box” look appeals to many teenage girls.
So from now on the standardised packaging of tobacco products will remove all form of branding such trademarks, logos, colours and graphics. The brand name is to be presented in a uniform typeface for all brands and the packs would all be in one plain neutral colour.
According to the minister there is strong evidence that standardised packaging increases the effectiveness of health warnings, reduces false health beliefs about cigarettes; and reduces brand appeal, particularly among youth and young adults. It is an interesting approach, given the Government only recently mandated that cigarette packaging must contain photographs of the damage that can be caused to people by use of the product. If you buy a packet of 20 in a shop you will be confronted with graphic images of grossly damaged skin and amputated or rotting limbs, all caused by cancer.
I SAW my 14-year-old daughter recoil in horror at such images on television news last Tuesday evening but, unfortunately, the international evidence is that such shock tactics don’t work and can be counterproductive. The stick, such as the ban on smoking in the workplace, which covers bars and restaurants too, seems to work far better than the carrot. No wonder the minister is talking about extending it to cars carrying those under the age of 16.
The idea of strictly enforced regulation has its attractions. It brings in some money to cover part of the €1 billion health bill arising from the adverse effects of smoking. The tax take from cigarettes doesn’t seem to be far off that but it could be more. The trade off in the loss of revenue from a fall in sales should be an equivalent drop in health costs. That won’t happen if people are smoking illegal products from which the State receives no compensation.
Accountants Grant Thornton recently calculated the value of illegal cigarettes traded in Ireland at €691 million. The industry has claimed that nearly 30% of cigarettes smoked in Ireland are distributed illegally, thereby depriving the State of excise and VAT. The Revenue Commissioners disputes this, putting cigarette consumption in 2011 at 5.5 billion individual cigarettes, of which 15%, or about 770 million, were sold illegally. The loss to the State was put at over €250 million.
The industry has argued that the more expensive cigarettes become the more likely it is people will try to find product on the illegal market. If that is the case then other ways may have to be found to disincentive people from smoking. Sticking cigarettes into plain packaging looks like a reasonable approach.
* The Last Word with Matt Cooper is broadcast on 100-102 Today FM, Monday to Friday, 4.30pm to 7pm.
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