Tobacco companies run a multibillion-dollar industry. They are extremely skilled at marketing their lethal wares and maximising their profits. It is inconceivable they would spend millions on branding and packaging unless it helped boost their sales.
OPINION: Tobacco companies, including Philip Morris New Zealand, have claimed that forcing them to sell cigarettes in plain packets will not reduce smoking rates. That claim flies in the face of the enormous efforts they have undertaken to challenge the enforcement of plain packaging in Australia, where it is due to come into force in October, and their threats to take legal action here should New Zealand follow suit.
The companies have made much of the infringement of their trademarks and intellectual property rights. However, what is really driving them to protest so vigorously is the fear that, despite their claims to the contrary, tobacco sales will fall once the packaging has been stripped of its colourful and enticing branding.
In Australia, the move would see warnings on the dangers of smoking take up most of the space on packets, with brand names in generic type on the bottom. A consultation document last month proposed plain packaging for New Zealand, and Cabinet is due to make a decision in November. Britain, Canada and the European Union are considering similar rules.
A report on plain packaging prepared by Germany’s Berenberg Bank this year described it as ‘‘the most material outstanding threat’’ to the tobacco industry. In particular, the move is expected to have a big impact on preventing young people from taking up smoking.
The tobacco industry’s first attempt to head off plain packaging across the Tasman failed last week after Australia’s High Court ruled it was not a breach of the constitution. However, the World Trade Organisation is still to hear claims from the Dominican Republic, Ukraine and Honduras, which argue that plain packaging breaches Australia’s WTO obligations. Philip Morris Asia is also taking action against Australia under its Bilateral Investment Treaty with Hong Kong.
Similar WTO action is forecast should New Zealand introduce plain packaging, as Associate Health Minister Tariana Turia intends.
The Government should not be deterred by such threats. It has already taken significant measures to reduce the harm from smoking, including tax hikes that will increase the price of a pack of 20 cigarettes to $21 by 2016.
Nor should the Government be put off by claims that once plain packaging is in place for tobacco, there will be pressure to apply it to other harmful products, such as alcohol. A case can easily be made for treating tobacco differently. Alcohol can be safely consumed in moderation. Tobacco is the only product that, used exactly as its manufacturers intend, kills.
Plain packaging is an effective way to reduce the uptake of a habit that claims the lives of 5000 New Zealanders a year and costs the health sector about $2 billion. Mrs Turia should stick to her guns.
- The Dominion Post