The Institute of Economic Affairs (IEA) could hardly contain its joy at news New Zealand’s incoming coalition government decided to repeal laws made last year, that prohibit tobacco sales to individuals born after 2008.
The “eccentric idea” and “unworkable pipe dream” was always “doomed to failure” squealed the neoliberal, free market thinktank’s head of lifestyle economics Christopher Snowdon.
The IEA – which knows a thing or two about doomed dreams, having been cheerleaders and architects of Liz Truss and Kwasi Kwarteng’s disastrous, Wilko-killing mini-budget – heralded the repeal. It barely hid its glee that Prime Minster Rishi Sunak – who announced plans for a similar law earlier this month, and whose relationship with the IEA is reportedly fast deteriorating – “now stands alone in the world”.
The thinktank makes the case that a generational smoking ban in the UK, which would make it an offence for anyone born on or after 1 January 2009 to ever be sold tobacco products, would siphon “billions of pounds from government coffers to criminal gangs”.
“The problems of enforcement, criminality and dwindling tax revenues will emerge more slowly but inexorably,” Snowdon adds. “The government’s justifications for this huge infringement on personal liberty do not stack up.”
Demand for cigarettes is in huge decline, unlike booze
The IEA – which BAT has donated to for decades – points to alcohol prohibition in the US, which led to “widespread criminality, disrespect for the law, harm to health from unregulated products and falling tax revenues”.
But unlike booze in 1920s US, demand for cigarettes is in huge and seemingly terminal decline. A June study by Action on Smoking and Health (ASH) finds the proportion of 11 to 17-year-olds smoking once a week or more to be 3.7%. NHS Digital data, meanwhile, finds only 1% of young people are regular smokers, and less than 2% do even occasionally. Sunak may as well be banning fax machines.
Yes, any ban would lead to the odd situation where a 28-year-old can purchase tobacco while a 27-year-old can’t, but such legislatory foibles are hardly worth chucking out a perfectly sound policy over. Every year around 76,000 people in the UK die from smoking-related causes, with many more living with debilitating smoking-related illnesses, according to the NHS. Plus the ban is popular. A YouGov poll for ASH finds 67% of people in England back the PM’s plans, regardless of political persuasion.
And let’s not pretend for a moment the incoming New Zealand government’s repeal of the law has anything to do with the actual policy. It is pure politics.
New Zealand’s new government is a coalition. The centre-right National Party had campaigned on the promise of tax cuts, to be funded chiefly by a new tax revenue stream from allowing foreigners to buy residential properties. The populist New Zealand First and the rightwing ACT party didn’t like the idea of more foreigners in the country – tax-paying or not – so demanded the idea was dropped as part of the coalition agreement.
Either way this could be Sunak’s legacy
“Policy changes will help offset the loss of revenue from that change,” said the new PM Christopher Luxon on Friday. Soon after, his incoming finance minister in a radio interview said “the changes to the smoke-free legislation had a significant impact on the government books, with about $1bn there”.
It’s not gone down well, and the coalition is now scrabbling to portray their budget-balancing bodge as a policy decision, citing “nasty side effects” and unintended consequences of the policy, which had been viewed with broad admiration around the world.
The longer-term savings, the potential for thousands of lives to be saved: all abandoned in pursuit of power.
“Turning the tide on harmful products that are entrenched in society cannot be done by individuals, or even communities,” said a disappointed Professor Lisa Te Morenga, co-chair of Health Coalition Aotearoa. “It takes good – and brave – population-level policies.”
Will Sunak stick to his guns in the face of opposition from spurned thinktanks and within his own party? He gets called a lot of things, but ‘brave’ is rarely one of them.
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