August 7, 2012
Despite the so-called concern for public health and complaints that smoking costs the NHS £5 billion per year [i], everyone in the UK knows the reason why tobacco has not been banned. Some physical health effects of smoking were understood over 400 years ago, as well as the financial benefits.
Smoking Dangers Understood 400 Years Ago
In 1604, James I of England was remarkably insightful for his time:
“Smoking is a custom loathsome to the eye, hateful to the nose, harmful to the brain, dangerous to the lungs, and in the black, stinking fume thereof nearest resembling the horrible Stygian smoke of the pit that is bottomless.” King James I of England.
In his written discourse on the subject, James also noted that autopsies found smokers’ “inward parts” were “infected with an oily kind of soot.”
With regards to passive smoke, James said, “The wife must either take up smoking or resolve to live in a perpetual stinking torment.”
Nonetheless, James’ was the first government to recognise taxes generated from tobacco to be extremely profitable. Trying to stem the popularity of smoking, he first increased taxes on tobacco by a staggering 4,000%. That stopped people from buying tobacco, but dried up the Treasury funds. James then cut taxes down to 2 shillings/pound and the money poured in. Subsequent governments were quick to learn the same lesson and reap the rewards. By 1624 England established a royal tobacco monopoly and the UK’s fate was sealed.
Buying Cigarettes from the Government
When it comes to cigarette sales, the government is the main player, not the tobacco industry. Around 85% of the cost of a packet of cigarettes is tax and goes to the Treasury. In essence, you are purchasing your favourite pack of cigarettes directly from the government. The tobacco industry’s cut is only around 10% to 15%.
- Total income from tobacco sales is approx. £14bn
- The Treasury receives approx. £12bn through revenue
- The tobacco industry receives approx £2bn through sales
- Cost of treating smokers on NHS is estimated to be £5bn per year.
- Pensions and support savings is estimated at £10bn per year (smokers dying early)
The average life expectancy for a non-smoker is 77.7 years for a man and 81.9 years for women. For smokers, life expectancy is reduced to 64.5 year for a man and 67.5 years for a woman.
Tobacco smokers who work their whole lives paying tax on their salaries and on cigarettes contribute to the Treasury funds, but will not live long enough to claim state pension for very long, if at all. That’s a win-win situation for the government.
Without the pharma industry the UK’s economy and state of employment would be dire. We need the pharma industry for life saving drugs, fertility treatments, everyday medicines and to prolong our lives. The pharma industry contributes billions of pounds into the UK’s econonmy and Treasury. However, let’s not pretend this is about our well-being, it’s about business and money and the pharma industry makes lots of it. The previous thinly veined stopped smoking campaigns backed by the pharma industry have failed. Dr Siegel notes a study showing that one year abstinence rate with big pharma NRT is just 1.6%, which is hardly successful.[ii] The quit smoking failure rates by using current licensed NRT and mind warping drugs assures one outcome, that smokers return to buying cigarettes. When NHS treatment is eventually required to treat smoking related illnesses the pharma industry is on hand again to supply more drugs, at further expense.
Tobacco Harm Reduction groups have called for more alternatives to be made readily available. The Government’s Behavioural Insights Team has already acknowledged electronic cigarettes could prove an effective substitute for conventional smoking and that the ‘quit or die’ approach has failed. In fairness to the current government, they have been more receptive towards electronic cigarettes and alternative nicotine products than the previous Labour administration who tried to ban e-cigarettes outright. A rift still exists within the coalition in regards to e-cigarettes, and views vary depending on who’s pulling their strings. We hope common sense will prevail in the end.
[i] Smoking costs NHS £5bn a year
[ii] New Study Demonstrates How Conflicts of Interest with Big Pharma Influence Reporting of the Effectiveness of Smoking Cessation Drug Treatment