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Wednesday, 25 February 2009
Page: 1847


Ms ROXON (Minister for Health and Ageing) (6:04 PM) —in reply—I would like to take the opportunity to thank the many members who have taken part in the debate on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. Whilst there is a fair amount of difference between the different sides of the House on this, there is certainly a strong theme running through all of the speeches. Despite some of the earlier comments from the previous shadow minister for health, denying that binge drinking is a problem, I think the new shadow minister and some of his colleagues who have spoken on this have indicated their concern that binge drinking and the abuse of alcohol is an issue that we must grapple with. Obviously, we have in the bill before us a measure which we in the government believe can be part of the solution. We hope that the opposition will reconsider their position and see this as part of an important solution to an important problem.

I explained in my second reading speech the excise and customs tariff proposals, published on 26 April 2008, to increase the rate of excise and excise equivalent customs duty applying to such beverages from $39.36 to $66.67 per litre of alcohol content. I tabled these proposals in the House of Representatives on 13 May. The tax office and the Australian Customs Office have been collecting excise and excise equivalent customs duty at that higher rate since 27 April 2008. Of course, the data from the collection is one of the key issues that need to be considered by the opposition, and by the Senate when this matter comes before them in a number of weeks. The measure is designed to close a loophole which was created by the previous, Liberal government in 2000, when they reduced the rate of excise applying to alcopops. The government has increased the rate of excise because of concern about the increase in alcopop consumption. The data from 2000 was quite astounding, and we believe the lower rate of excise played a role in encouraging binge drinking.

I should flag for the benefit of the House that, at the conclusion of the debate, I am also going to introduce amendments to this legislation to ensure that the so-called ‘malternative’ products, which undermine these rate changes, do not enter the market. To do this, these amendments alter the taxation definition of ‘beer’ in the Excise Tariff Act and ‘beer and wine’ in the Customs Tariff Act. Changes in the definition of ‘wine’ in the A New Tax System (Wine Equalisation) Tax Regulations 2000 will also follow as part of these changes.

Today, as I acknowledged, the member for Dickson, the shadow minister for health, said that the Liberals do share the community’s and the government’s concerns about alcohol issues and that he would support sensible policies to tackle binge drinking. As I said at the beginning, I welcome this change of tack from the opposition. It is a change of position, as the former health minister and the former shadow minister for health have both been on the record a number of times denying this is a problem. Mr Hockey, now the shadow Treasurer, said on 30 March:

… I don’t think you should overplay it—

referring to the binge-drinking crisis—

… let’s not go over the top.

Tony Abbott, the former health minister, said in June last year, ‘Trying to say that binge drinking is happening nearly all the time in ways which are a deadly threat to the youth and even the adults of this country is a beat-up.’ So I welcome the opposition’s recognition at last that there is a binge-drinking problem in our community; but I do say to the current shadow minister that if the coalition genuinely believe this then there is one very simple thing they can do today to show it—that is, vote to support the passage of the bill that is currently before the House.

I see that the shadow minister has also been calling today for revenue collected through this measure to be directed towards health and education. I think it is no coincidence that this is what the distillers now claim they want, but their strategy is pretty much as obvious as it is insidious: they want to cut their losses with past profits and revert to the alcopops cash cow in the future. I think the shadow minister jumping on this bandwagon does show just how confused the Liberal Party’s position is, and maybe that is because with the new shadow minister there is a change in position and it has not had time to run its course.

Our very clear advice—and I know that the shadow minister would be distressed if he thought that he had got the position wrong—is that if this measure is voted down then the money must be refunded to the distillers. The member for Dickson has been out and about today saying, ‘We don’t want to see this money go back to the distillers; we want it to go into health and education.’ The only way you can ensure that happens, Member for Dickson, is to ensure that the Liberal Party votes for this bill today and in the Senate. That way we can ensure that money is invested in health and education measures. If the Liberal Party vote against it, we will have no choice but to refund that money to the distillers.

I am happy to provide more detailed advice to the member for Dickson if he doubts that, but I am sure he would be well aware that that is the position and that the only way his now-expressed desire for money to be put into health and education can be achieved is for him to ensure the Liberal Party vote for this measure. The opposition can, as I say, either vote against this and give the money back to their newest best buddies the distillers or they can vote with the government and boost health spending on important initiatives. We have already said that, if the law is passed, we will spend a huge proportion of this money on preventive health.

The member for Dickson made a number of claims, both in his speech and in comments more recently, that include many distortions and half-truths that have been bandied about during the course of this debate. Let me go through these one by one. Firstly, the opposition has said that not enough is being spent to tackle binge drinking. I can of course remind the House that our $53 billion binge-drinking strategy includes a number of very important measures. There is $14.4 million for community-level initiatives to confront the culture of binge drinking, in partnership with sporting and community organisations; $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility—the very sorts of education measures that it sounded like the member for Dickson was encouraging us to invest in today; and $20 million on an advertising campaign, ‘Don’t turn a night out into a nightmare’, confronting youth with the consequences of binge drinking.

The shadow minister has described this expenditure as ‘meagre’, but interestingly this ‘meagre’ $53 million is $53 million more than the coalition spent on this issue. I think it would be a perfectly responsible position for the opposition to take if they offered to support this measure and wanted to encourage more investment in those sorts of projects. But instead they are voting against this measure and criticising investments that we are making that are significantly more than what the previous government did. Of course, that is not all the government is doing; far from it. In addition to the $53 million binge-drinking strategy, the government announced last year $872 million in new funding for preventive health as part of the COAG agreement. This is the biggest ever investment in preventive health; it is a very large amount of money. It includes new initiatives which will tackle binge drinking. Alcohol, tobacco and obesity are the key targets of that spending, and obviously a significant chunk of that will have an impact on the ways that we might tackle binge drinking.

When the alcopops measure was announced last year, the government made it clear that a significant portion of the revenue would go towards preventive health measures. I said at the time that this change would see the single biggest investment ever by a Commonwealth government in preventive health measures, and at COAG last November that is exactly what the Rudd government delivered on this commitment. The revenue from the alcopops measure is expected to be under $1½ billion. This investment is over half of the total revenue that is collected. This may be an important thing for the shadow minister to acknowledge given that he has called for more investment in these areas.

Secondly, the shadow minister says there is no firm evidence for this measure. That is blatantly untrue. Let me first of all quote from research commissioned under the Howard government. The report by David Collins and Helen Lapsley titled The avoidable costs of alcohol abuse in Australia and the potential benefits of effective policies to reduce the social costs of alcohol deals with a whole range of issues, from the impact on families to the impact on employment and the impact on our hospitals. The report states—and of course I am just quoting a section of it:

There would appear to be strong justification for the April 2008 increase in the Australian tax on pre-mixed drinks … by 70 per cent.

…            …            …

… alcohol excise taxes are capable of being designed explicitly to target the types of alcohol known to be the subject of abuse (for example, high strength beer and alcopops)

…            …            …

For example, studies show that young people are more influenced by the price of alcohol so that increasing the tax rate on alcoholic drinks which are specifically targeted at the youth market … is likely to be effective.

Let me also cite for the House the data which shows this measure is working. Since this bill was introduced we have had some even more up-to-date data. This has been provided previously to the House, but let me just go over that again because the member for Dickson seems not to be fully aware of that. The Australian Taxation Office clearance figures show that for the period May to June 2009 total spirit clearances decreased by 7.9 per cent compared to the same period in 2007-08 and compared to solid growth in the previous three years. This figure comes from a 34.6 per cent decrease in alcopops clearances.

So, when the member opposite asks whether there is any evidence that this measure is working, it should be noted that the clearest evidence is in the sales data, which shows a 34.6 per cent decrease in alcopops clearances. It is true that there has been some substitution, and there is a 17 per cent increase in full-strength spirit clearances over that period. When you combine those figures, given that the base is obviously different for the amount of alcopops sold and the amount of spirits sold, the combined decrease in spirits is 7.9 per cent. That is a huge decrease in the amount of alcohol that is being purchased and the clearest measure of why this measure is being effective—and, of course, the clearest reason that the industry is fighting so hard against it. This is a much better result than the government had forecast. At the time of the budget, it was forecast that the measure would merely slow the growth in alcopop sales. We thought that was a conservative and responsible approach to take. Happily, the measure has been even more effective. I have said publicly—probably to the misgivings of the Treasurer—that as the health minister I would be delighted if this measure were so effective that we collected no tax from it. But I do not think that that is likely to be the case. To see this dramatic reduction is the clearest evidence—and uncontested evidence—that this measure is working.

No-one has ever said—and the government does not contend—that any single measure will, of itself, solve the problem. We know that this is a problem that has been growing in our society for more than a decade. But, as part of a comprehensive package, this measure certainly can. We do not pretend that we have all the answers, and we have made it quite clear that we are prepared to work with members of the opposition or senators who are interested in ensuring that our comprehensive package deals with the range of issues that they believe it should. The very reason that we set up our National Preventative Health Taskforce is so they can look at what comprehensive, multipronged approach is required to ensure that our strategies will work. That is what we are doing with our $53 million National Binge Drinking Strategy—and the $872 million of COAG money—and we will of course consider the recommendations of the task force when they are provided to us in the middle of this year.

In this summing-up speech I am keen to make sure that some of the relatively outrageous claims of others made in this debate are all properly answered. The shadow minister referred to the Access Economics report which was out today—a report which was, of course, paid for by the people who make alcopops. It is clear from even a cursory read of this that the report is seriously flawed and it really is a deliberate attempt by the industry to manipulate debate. Unfortunately, this is not the first time that they have used reports and statistics to do this. One only needs to open the report—as I am sure the shadow minister has—to see that the authors themselves conclude that ‘firm conclusions were not able to be drawn at this stage’, a point that the member for Groom made earlier today in the House.

The report admits that the period of study is too short to be meaningful, that there are gaps in the data, that the figures may change and that the opposite evidence, from more reputable sources, is far more frightening and shows that alcohol related hospital admissions rose rapidly after the Liberals’ decision to give alcopop producers a tax break. I think that in this House both the shadow minister and I would probably be able to agree that this trend is very worrying. The truth is that it is not possible to detect from the data—any of the data that is relied on by Access Economics or others—or for any hospital to give any information about, what type of alcohol a person is presenting with. We have not been able to—and I do not think one can—assume that a single measure will be able to turn around a very wide social problem, but we do think that this measure has had an impact. What we can look at, for example, is the Australia New Zealand Journal of Public Health, which found that between 1999-2000—the period when the original change from the previous government was introduced—and 2005-06 the number of young women admitted to hospitals because of alcohol abuse more than doubled. So we are talking about a large increase—from a small number, but it is, I know, a worrying trend for any parliamentarian or any parent to see.

The report paid for by the distillers uses data over an incredibly short period of time, which it admits makes it unsuitable to base firm conclusions on. It uses hospital data of dubious quality. As the report itself points out:

… there is no agreed national approach to collection of diagnosis codes and demographic information for ED patients.

I might say, for the benefit of the shadow minister and other members in the House who are interested, that more rigorous national reporting is one of the issues that we got the states to sign on to in our COAG agreement last year. These are very serious problems, and it would help all of us in health debates if we had better data. But we do not currently and we should not pretend and misuse it in circumstances where it is just not able to be used to draw conclusions. The report uses just one diagnosis code for most of its data, excluding others and distorting the statistics. It does not show any causation between the government’s actions and the effects it alleges to show. The report also ignores the tax office figures on alcohol consumption—figures which are uncontested.

This is the sort of material that the opposition are relying on to support their arguments. I think it gives them a credibility problem. I think we have seen from the comments by the member for Dickson today that the opposition are a little bit uncertain on where they now stand on this. The question for the opposition—the answer to which we will no doubt see in how they choose to vote, given that this debate is now concluding—is whether or not they support action to tackle binge drinking. If they do support action to tackle binge drinking, they should be voting with the government—they should be on this side of the House backing the bill and encouraging us to spend more money on health and education to tackle this social problem.

This measure is working. It is backed by research, it is backed by health experts and it is backed by the evidence. It will enable us to make significant investments in preventing and tackling alcohol abuse. It should be supported. If it is not supported, it will be the Liberal Party that is forcing us to return hundreds of millions of dollars to distillers—the very people who are out there trying to hook young people on their products.

Question put:

That this bill be now read a second time.