Standardised tobacco packaging could boost the North East economy by more than £30m

New figures show the financial benefits that standardised packaging of tobacco products could bring to the North East

Cigarettes
Cigarettes

Standardised tobacco packaging could save the North East more than £30m in the first year, new figures have revealed.

Public Health England has shown the potential benefits that plain packaging of tobacco could bring, not only for health, but in savings to the region.

In June, the Department of Health published draft regulations for consultation for proposed requirements for the packaging of cigarettes and hand-rolling tobacco. The regulations include proposed policies on the colour of the packet, allowed text and typeface, and requirements for the appearance of individual cigarettes.

The consultation closes tomorrow. Powers to introduce standardised packaging of tobacco products already exist in legislation.

Ailsa Rutter, director of Fresh, the North East anti-smoking office, said: “Tobacco is the only product when used correctly kills one in two long-term users. An addictive product that keeps smokers trapped in poverty and condemns half to an early death should not be gift wrapped in glossy colours and shiny holograms.

“Freeing up the money spent on smoking can feel like a pay rise and free up family budgets for so many nicer things.”

The financial figure was calculated by estimating the number of smokers in each local authority using the smoking prevalence and 18+ population estimates for 2012 and 2013.

The new figure comes following recent official data from Australia, where standardised packaging was introduced in December 2012. Data released by the Australian Treasury show a 3.4% fall in tobacco sales by volume in the first year following the introduction of standardised packs.

Pictured is Ailsa Rutter from FRESH - Smoke-free North East
Pictured is Ailsa Rutter from FRESH - Smoke-free North East
 

If that was mirrored here, PHE predicts that total savings across England would be up to £500m nationally and £30.6m in the North East.

Dr Roberta Marshall, North East centre director for Public Health England, said: “The harms from smoking hit hardest in some of the more deprived communities in the North East, where most smokers start as children.

“More than 13,500 people and 129 organisations in the North East, including every local authority, have supported calls for standardised packaging.”

With tobacco a major cause of health inequalities – the greatest harm being suffered by the most disadvantaged – the benefits would be most felt in areas of greater social deprivation; not only reducing the harm caused by smoking and boosting health improvement, but also increasing families’ disposable income.

Retailers earn relatively little profit from tobacco sales. On average, only 7% to 9% of the cost of tobacco is retained by the retailer, compared to 20% to 30% for food and drink products. Money saved by customers from reduced spending on tobacco is likely to be spent elsewhere locally and benefit local businesses more.

John McClurey, an independent newsagent with a shop in Newcastle and a member of Gateshead Council, says he only makes around 4% profit on average from a pack of cigarettes.

He said: “A reduction in tobacco expenditure actually means more money being spent in the local economy. Traders like me are well aware of the tiny profit from tobacco products – I make similar profit from a pack of chewing gum as a £6 pack of cigarettes.

“What my customers save by quitting or never starting to smoke, they can spend on other goods or services in the area – providing a real boost to the local economy.

“Standardised packs would cause no confusion or extra costs for small businesses like mine and frankly I would much rather sell birthday cards than sympathy cards.”

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