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Monday, 2 April 2001
Page: 26216


Ms JANN McFARLANE (10:39 PM) —The health effects of smoking on our society are well documented. The Australian Council on Smoking and Health has estimated that deaths caused by smoking related diseases will claim the lives of over 18,000 people this year. Governments in Australia have worked hard over the past 15 years to combat the evils of smoking. We have bans on cigarette advertising. We have warning messages on cigarettes and other tobacco products, and the Quit campaigns run throughout Australia have been very effective. In my home state of Western Australia there are bans on smoking in workplaces. Pubs and restaurants are exempted, though they have to provide non-smoking areas. Recently, through the great work of the Australian Liquor, Hospitality and Miscellaneous Workers Union, employees at the Burswood Casino have won the right to work in a smoke-free environment. The social and health costs of passive smoking on employees, especially those in the hospitality industry, over the years are yet to be fully measured.

My mother, who was a barmaid and a cook for 60 years, developed respiratory disease and paid the price with a painful and shortened life. An important issue from a health perspective is the effect of tobacco smuggling on our attempts to control smoking. Australia is relatively lucky. Tobacco smuggling is largely restricted to chop chop. Chop chop is cheap tobacco that is sold illegally in delicatessens, pubs and the backs of cars. Essentially, it is tobacco in clear plastic bags and is extremely cheap, as the dishonest people selling it do not pay the government any tax on it. However, the sale of illegal tobacco in Asia and the rest of the world is an organised and highly profitable industry. For example, in East Timor you can buy a carton of Marlboro cigarettes for the price of a packet in Australia.

I would like to draw the attention of the House to a report entitled `Tobacco companies linked to criminal organisations in lucrative cigarette smuggling' by the International Consortium of Investigative Journalists. One of the journalists who wrote this report is Bill Birnbauer, a journalist at the Age newspaper in Melbourne. I seek leave to table this report.

Leave granted.


Ms JANN McFARLANE —The allegations in this report are extremely interesting. Unfortunately, I do not have time to go into great detail. However, I will give a brief outline of the content. Basically the report alleges that the major tobacco companies have been engaging in the sale of black market cigarettes. These are commonly described in the industry as `duty not paid, parallel markets, general trade or transit'. The report states:

It is estimated that about one in every three cigarettes exported worldwide is sold on the black market.

The report reads like something out of a James Bond novel. It includes the US Mafia, triads and Sicilian crime families. The report also alleges that British American Tobacco PLC is involved in this sale of black market cigarettes. I must admit that I initially viewed this report with some scepticism. However, I also did some further research. For those who are interested in this very topical issue, there is some excellent information on general smoking issues and the tobacco smuggling story particularly on the web. This web site is run by an organisation called ASH—Action on Smoking and Health. The web address for this site is www.ash.org.au. On this site amongst the huge list of documents on tobacco smuggling are two interesting pieces of information. The first is a press release by the Secretary of State for Trade and Industry in the UK, Stephen Byers. In this press release he announces the British government's response to the findings of the Health Select Committee report on the tobacco industry. This response includes the appointment of investigators to look into allegations that British American PLC was implicated in smuggling. The second is the details of a civil case with the European Community, on behalf of its member nations, the plaintiff in a racketeering case against RJR Nabisco Inc. This case is in the US District Court and centres on cigarette smuggling.

Why have I brought this to the attention of the House? British American Tobacco PLC, which is the subject of the investigation of the British Department of Trade and Industry, has recently been engaged in purchasing the remainder of British American Tobacco Australasia—BATA—in a $1.1 billion mop-up deal. The chairman of BATA prior to the offer and the architect of the deal was Mr Nick Greiner, the former chairman of W.D. & H.O. Wills which merged with Rothmans Holdings Ltd to form BATA. The chairman and company may not have been aware, before the merger, of the shadow on BAT PLC's reputation in relation to cigarette smuggling. We need to watch with interest for the result of the British departmental investigation and the result of the European Community's court case. An adverse finding in either of these against British American Tobacco PLC will raise questions regarding the company's corporate citizenship. This is extremely important now that British American Tobacco Australasia is almost wholly controlled by it. Tobacco smugglers circumvent government controls over the sale of tobacco. (Time expired)