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Tuesday, 1 June 2010
Page: 4804

Mrs D’ATH (6:53 PM) —I rise to speak in support of the Excise Tariff Amendment (Tobacco) Bill 2010 and Customs Tariff Amendment (Tobacco) Bill 2010. These bills seek to increase the excise and excise equivalent customs duty rates for tobacco by 25 per cent. The Customs Tariff Amendment (Tobacco) Bill 2010 contains amendments to the Customs Tariff Act 1995 in respect of imported tobacco products that are complementary to the amendments to the Excise Tariff Act 1921. These amendments increase the rates of customs duty for tobacco products by 25 per cent, which is the same as the increase in rates of excise duty. The increased rates of customs duty will apply to tobacco products imported from all countries, including those goods imported under any of Australia’s free trade agreements.

These amendments will ensure that the rates for customs duty on imported tobacco products are the same as the rates of excise duty on those goods when produced in Australia under the Excise Tariff Amendment (Tobacco) Bill 2010 and the Excise Tariff Proposal (No. 1) 2010. As with the amendments to the excise applying to tobacco products, the amendments to the customs tariff will also take effect from 30 April 2010.

I understand this increase is not welcomed by the tobacco industry, nor is it welcomed by the many people who smoke. The government, however, does have a responsibility to do what it can to reduce Australia’s smoking rates. I know that there will be those who argue that this measure will not reduce the rates of smoking, and it appears that the member for O’Connor may be one of those people, referring to this as simply a tax grab. However, to make this statement is to do so in ignorance of the many calls from various reports and inquiries to increase the cost of tobacco as a measure to tackle the terrible consequences of this choice of lifestyle and also to ignore the evidence of the results of such price increases around the world. In supporting these bills, I do not argue, nor does the federal government, that increasing the cost of tobacco on its own will address all of the health problems associated with smoking. Those calling for action on tobacco certainly argue for a range of measures to be taken.

The member for Makin has talked about the risk of smoking and second-hand smoking. These risks should not be underestimated. The worst examples I have seen in relation to smoking are pregnant women and new mothers. I was amazed when I saw pregnant women with their hospital bands on standing outside maternity hospitals on the footpath smoking. I have seen a mother with a newborn baby in a carry-pouch, with the baby facing her as she smoked and blew smoke into the baby’s face. Clearly we have a long way to go in educating about the harm of cigarette smoking for unborn babies and second-hand smoke around children.

One of the recent comprehensive assessments of tobacco and its effects is the national Preventative Health Taskforce report released on 30 June 2009, entitled National preventative health strategy: the roadmap for action. Chapter 3 of the report, entitled ‘Tobacco: towards world’s best practice in tobacco control’, outlines 11 key action areas. The report outlines the case for prevention. In support of these bills, I will read from the report. The report at page 170 states:

The case for action on tobacco is clear. Since 1950, when the dangers of smoking were recognised, almost one million Australians have died because they smoked.

Trends in recent years have been encouraging, but there is no room for complacency while the death toll from tobacco continues, thousands of young people each year start smoking, nonsmokers are exposed to second-hand smoke, disadvantaged groups are disproportionately affected, the overall cost of smoking to the economy is more than $30 billion each year, and tobacco companies maintain efforts to promote sales of their lethal product.

Australia has been among the global leaders in tobacco control … we have the opportunity to show the way to the rest of the world in terms of what can be achieved through a comprehensive, coordinated, evidence-based, long-term strategy that is conscious of the needs of the entire community.

We know what needs to be done. The strategies set out in this report are based on the best international evidence and research, together with advice from some of the world’s leading experts in tobacco control.

The task force in their report made reference to the international Framework Convention on Tobacco Control, which was the first treaty negotiated under the auspices of the World Health Organisation. It was adopted by the World Health Assembly on 21 May 2003 and entered into force on 27 February 2005. The task force report notes that, if the comprehensive approach outlined in the strategy outlined in the report is implemented, modelling suggests that we can achieve a reduction in the prevalence of daily smoking among adult Australians aged 18 plus from 17.4 per cent in 2007 to 10 per cent or lower by 2020.

I am sure that all of us in this parliament would agree that this is a target that we should all do what we can to achieve. The report, in addressing the key action areas, stated:

… to accelerate declines in smoking in Australia it is essential that we step up efforts in:

  • Taxation policy
  • Public education
  • Legislation
  • Health system interventions, particularly those aimed at high-need and
  • High-risk groups.

The report notes that increasing prices is one of the most effective measures that government can take to reduce tobacco consumption and prevalence. Analysis of changes in smoking prevalence in the largest Australian states in response to changes in various interventions found that the costliness of cigarettes has the most powerful impact of all the policies studied and that the effect of price was greatest among those on lowest incomes.

In Australia taxes presently comprise 68 per cent of the total cost of cigarettes. This percentage is considerably higher in other Organisation for Economic Cooperation and Development, OECD, countries, for example, 80 per cent in France, 78 per cent in the United Kingdom, and 76 per cent in Canada. Of 19 OECD countries listed in the report for 2003, Australia has the third-lowest taxes on cigarettes. The taskforce report recommendation action 1.1 is to:

Ensure that the average price of a packet of 30 cigarettes is at least $20 (in 2008 $ terms) within three years, with equivalent increases in the price of roll-your-own and other tobacco products.

Of course, the Preventative Health Taskforce report is not the only recent inquiry into the consequences of smoking and the detrimental consequences to people’s health and the increasing costs to the health system of our country. The Australian government’s most comprehensive review of the health system in Australia undertaken by the National Health and Hospitals Reform Commission during 2008 and 2009 also looked at the cost of chronic illness in Australia and the causes of such illnesses. The Health and Hospitals Reform Commission reported in its A healthier future for all Australians final report in June 2009 that chronic conditions affecting our health are more prevalent than ever before. Over the last century the report states that chronic disease has become more prominent than infectious disease as a cause of death, and this trend is likely to continue. Already, more than 50 per cent of GP consultations are for people with a chronic condition such as heart disease, cancer, neurological illness, mental disorders and diabetes. Expenditure on chronic disease in Australia accounts for nearly 70 per cent of total health expenditure on disease.

We know that many chronic diseases are preventable. Smoking, excessive alcohol, lack of physical activity and low fruit and vegetable consumption are all risk factors which contribute to the burden of chronic disease. The report goes on to state that good health is therefore about more than health care. Governments must take action to nudge people towards health-promoting behaviour.

In addition to the Preventative Health Taskforce report and the Health and Hospitals Reform Commission report, the Australian Future Tax System review also looked at the issue of tobacco taxation and concluded:

There is a strong case for a substantial one-off increase in tobacco excise. Australian retail prices for cigarettes are moderate by international standards and taxes constitute a relatively small share of the retail price.

It recommended a substantial increase in taxation depending upon evidence on the costs of harm from tobacco smoking, the indexing of tobacco excise to wages rather than CPI, and the removal of the duty free allowance for tobacco. The increase as a result of these bills is expected to reduce the number of smokers in Australia by two to three per cent, or by approximately 87,000 people. It is also expected to reduce the total consumption of tobacco by around six per cent.

This move has been endorsed by the Australian Medical Association, the National Heart Foundation, the Cancer Council of Australia, the Australian Nursing Federation, the Public Health Association of Australia and Action on Smoking and Health among other public health groups. Tobacco related diseases are responsible for approximately 750,000 bed days in hospitals every year. Cigarettes are toxic and poisonous, containing 4,000 chemicals. Cigarettes are estimated to cause one in five of all cancer deaths.

We also know that cigarettes cause heart disease and strokes, among many other chronic diseases. I was pleased to attend this year’s launch by the Heart Foundation of the Go Red for Women Day at Parliament House today. This campaign is about lifting the awareness that four times more women die of heart disease each year compared to breast cancer. Smoking is one of the factors causing heart disease in women. I hope to lift awareness of this risk in heart disease when I hold my own Go Red for Women day on Friday, 11 June, at a breakfast function in my electorate of Petrie. Many local women will be attending and receiving important information about preventative measures they can take to avoid heart disease.

Many organisations are working hard to lift awareness about the risk of smoking. The Rudd government is ensuring that it is playing its part to address preventative chronic diseases in Australia. I am proud to be part of a government that is tackling this important issue and introducing measures that form part of a comprehensive package against smoking, including a world first—the government will introduce legislation to ensure that cigarettes in Australia are sold in plain packaging by 1 July 2012. I support the move to plain packaging as part of the initiatives to reduce the numbers of people taking up smoking. This was also a recommendation from the Preventative Health Taskforce. Research has shown that industry branding and packaging design reduce the effectiveness of graphic health warnings on tobacco products.

There are those who may seek to argue that increasing the cost of cigarettes will not reduce the number of cigarettes being smoked. The same argument was of course put up when the government sought to increase the excise on alcopops. One year ago the opposition and the distillery industry argued that an increase in the cost of alcopops would not see a reduction in the consumption of such drinks, and of course we have heard the same comments from the member for O’Connor today. Well, one year on the Bureau of Statistics figures show that Australians drank 19 million fewer standard drinks in the 2008-09 financial year compared with the previous year. This is drinks overall—not just a reduction in alcopops, as the member for O’Connor claims, but overall alcohol consumption. In relation to premixed drinks, a 30 per cent drop in consumption, equal to 440 million fewer standard drinks was recorded. This shows that the tax rise was effective in cutting binge drinking. Peter Miller a senior research fellow at Deakin University said:

… for the first time in about five years we have seen a real decrease in alcohol sales across the board. This is incredibly good news for the federal government’s alcopops tax.

What this evidence shows, and what the evidence from the Preventative Health Taskforce report and the Health and Hospitals Reform Commission report shows, is that by increasing the cost of products such as alcohol and tobacco in a targeted way, and as part of a broader preventative health strategy, positive results can be achieved.

Yesterday, nations across the world embraced World No Tobacco Day. The Rudd government embraced this day, with the Minister for Health and Ageing, Nicola Roxon, announcing that the government will provide $5 million to help support anti-smoking services around Australia. The $5 million for Quitline will help support the increased demand for services. Increased support for Quitline was a recommendation of the National Preventative Health Taskforce. The $5 million in one-off funding will be made available to: address one-off costs from this period of high demand for their services, including increased hours of access where appropriate; develop and deliver counsellor training, including specific training to help high-risk and highly disadvantaged groups quit; develop new and online quit support resources; and improve quality and national consistency across Quitline services.

This funding is in addition to the Rudd government’s comprehensive anti-smoking package, following the landmark COAG agreement that delivered fundamental reform to Australia’s health and hospitals system. Importantly, revenues raised from this measure, and other existing revenues from tobacco, will be directly invested in better health and hospitals through the National Health and Hospitals Network. This government is committed to health and hospitals reform across the country and a key element of that reform is a focus on preventative health. This is an area that in the past has had little recognition or investment.

The Rudd government are taking action to improve preventative health through: a record $872 million investment in preventative health, including programs in schools, workplaces and community settings; $103.5 million under the National Binge Drinking Strategy; the decision to establish the Australian National Preventative Health Agency; and $449 million to improve the quality of care for Australians living with diabetes.

I have mentioned the Australian National Preventative Health Agency. The bill establishing that agency was introduced in the House on 10 September 2009. I was proud to speak in support of that bill at that time and continue to support the establishment of the National Preventative Health Agency. The establishment of the ANPHA has been recommended by both the Health and Hospitals Reform Commission and the National Preventative Health Taskforce. In fact, the creation of the National Preventative Health Agency was proposed at the 2020 Summit. Unfortunately, that bill has been delayed by the opposition in the Senate since October last year, with no indication that the opposition will be changing its position any time soon.

The member for Dickson, in speaking on the bills now before the House, talked about the opposition’s proud history in health and, more particularly, the Leader of the Opposition’s record as Minister for Health and Ageing in the Howard government. The current shadow health minister may look back at the Leader of the Opposition’s record as health minister with pride, but that is not the reality. The reality is that the Leader of the Opposition ripped $1 billion out of the health system when he was health minister. Now, as Leader of the Opposition, he stands in the way of preventative health in opposing the Australian National Preventative Health Agency Bill. He has, in the past, opposed the increase in the excise on alcopops, and the government has had no indication that he will support the broader health and hospitals reform agenda that the Rudd government is putting forward.

The opposition have already indicated that they support an increase in the excise of tobacco. In fact, the opposition leader referred to his support for an increase in his budget reply speech. I would like to think that their support on this bill is a positive step forward for the opposition and that they will stop opposing for the sake of opposing and get behind the government’s health reform agenda, but I suspect that that is not going to be the case.

I support these bills. I believe they are a positive step forward in trying to tackle the costs and the health implications of smoking in this country. I commend the bills to the House.