Jonathon Duniam (Tasmania, Liberal Party) Share this | Hansard source

Hear, hear, Senator Williams! It was an interesting contribution from Senator Leyonhjelm. It was very well researched, and he made some interesting points. I am not sure that I agree with all of them, but I think his speech was very well thought through and it was interesting to listen to.

All of us in this chamber recognise that tobacco smoking is one of the largest preventable causes of death and disease in this country, if not the world. As a disease, it is associated with an increased risk of a wide range of health conditions, including heart disease, diabetes, stroke, cancer, renal disease and eye disease, and respiratory conditions such as asthma, emphysema and bronchitis—diseases that I am pretty sure all Australian families have been impacted by in one way or another, unfortunately. My family is no exception to that. Over the years, grandparents that smoked and probably lived a little bit too well died of heart disease and emphysema. Tobacco was responsible for 7.8 per cent of the total burden of disease and injury in Australia in 2003, equivalent to around 15,000 deaths per year. As has been noted by previous speakers in this debate, it was estimated to cost Australia around $31½ billion in health, social and economic costs in the years 2004-05.

Unfortunately, my own state of Tasmania has the highest smoking rates of all Australian states, with only the Northern Territory recording a higher rate of daily smokers. In 2011 Tasmania's smoking rate was 21.7 per cent, compared to a national smoking rate of 18 per cent. Within the Tasmanian population there are groups of individuals with significantly higher smoking rates than the general population. Currently, the smoking rate is especially high for males in my own age group, between the ages of 25 and 34, at 40 per cent of that population. In the 35- to 44-year-old bracket, it is at 38.6 per cent, which is alarmingly high, I think we would all agree. Tasmania continues to have the highest proportion of women who smoke during pregnancy, with a prevalence of 35.7 per cent for those aged under 20 and 30.8 per cent for those aged between 20 and 24. The smoking rate among Indigenous Tasmanians was found to be 44½ per cent in the year 2008—again, an alarmingly high statistic.

More alarming are the rates of smoking among minors, of those who are below the legal minimum age—something we as a country have been trying to stamp out for many years now. In 2011 the Australian secondary school alcohol and drug survey showed that six per cent of 12- to 15-year-olds were smokers, with 16 per cent of 16- and 17-year-olds having taken up the habit. I think that is a pretty unfortunate way to start young adult life. Most encouraging though is the changing attitude among adolescents and their growing awareness of health problems associated with the habit of smoking. In the 2011 survey, 96 per cent of students agreed that smoking causes lung cancer and that it harms unborn babies. The survey showed a changing attitude to smoking, with it no longer being seen as a normative behaviour among secondary students in Tasmania, which is something pleasing to report to the Senate.

The Australian government and state and territory governments, through the Council of Australian Governments, have committed by 2018 to reduce the national adult daily smoking rate to 10 per cent and to halve the Aboriginal and Torres Strait Islander adult daily smoking rate. This ambitious target is based on the relatively low smoking rate as compared internationally. Australia's low smoking rate though, I believe, is the result of sustained, concerted and comprehensive public policy efforts from all levels of government, of all political persuasions, and action from public health organisations.

In 1976 health warnings were first mandated on all cigarette packs in Australia. This was followed by a ban on cigarette advertising on radio and on television. In 1990, when I was eight, bans on the advertising of cigarettes in newspapers and magazines were introduced, and in 1993 all tobacco advertisements were banned. Between the years 1986 and 2006, bans on smoking in workplaces and public places were progressively phased in. For someone in my age demographic, it is hard to believe that there was ever a time when people were able to smoke at work or on aeroplanes or in other confined spaces, I must say. Between 1994 and 2003, we saw bans on smoking in restaurants. Efforts have also been made to change smoking behaviour, through using text-only health warnings in 1995; the more graphic health warnings, which we have all seen—and probably winced at—on packages in 2006; and plain packaging in 2012. Excise applied to tobacco has also proved to be an effective tool in shaping smoker behaviour, through increasing the price of tobacco.

I turn briefly to the history of tobacco excise. The federal government has imposed excise duty on Australian-made tobacco products and customs duty on imported tobacco products since 1901, since Federation. Until 1999 federal excise and customs duty were calculated on the basis of the weight of tobacco products. The excise regulation specified precisely how manufacturers needed to label, calculate and declare excise duty. It also specified how the weight of tobacco products, and the volume of alcohol and petroleum products, was to be calculated. For cigarettes, this included the weight of the filter and paper but not the weight of packaging. In the early years of the last century, manufactured tobacco was charged at a rate of one shilling per pound of product weight, and cigars were taxed at one shilling and one sixpence per pound. Since 1920 the rate of the duty has been set out, and frequently amended, in the schedules to the Excise Tariff Act. Historically, duty on tobacco in cigarettes was levied at a higher rate than duty on non-cigarette tobacco.

In November 1983, the then federal Treasurer, Hon. Paul Keating, changed customs and excise policy in several ways. First, the rate of federal excise and customs duty was linked with the Australian consumer price index, meaning that, since that time, excise and customs duty have automatically increased in February and August each year in line with CPI for the six months to the previous December and June. Second, the rate of duty for cigars was immediately made equal to that for cigarettes. Third, the rate for non-cigarette tobacco was increased by $5 a kilogram. In subsequent budgets, the rate for smoking-tobacco was increased further—by another $5 per kilo in the 1984 and 1985 budgets, and then by another $1.90 in the 1986 budget.

Historically, tobacco products produced in Australia were subject to a lower rate of duty than that applicable to imported tobacco products. Customs duty was brought into line with excise duty following the publication in June 1994 of a report of an inquiry by the Industry Commission into the tobacco-growing and -manufacturing industries in Australia. Coinciding with the end of the tobacco industry stabilisation plans, the harmonisation of customs and excise duty was in line with government policy to reduce a range of direct and indirect subsidies in an attempt to improve international competitiveness of Australian exports.

Throughout the 1990s, health groups lobbied for increases in federal excise duty. In addition to the six-monthly CPI increases, the government increased the rate of federal excise applicable to cigarettes and other tobacco products on several occasions. These included the $5 per kilogram increase in 1992 and increases announced in the 1993 budget of three per cent in August 1993, and of five per cent in February and August 1994 and February 1995. The final incremental rise of five per cent planned for August 1995 was brought forward and increased to an immediate 10 per cent rise in the federal budget handed down on 10 May 1995.

In 1999, after extensive lobbying by health groups, the government moved from levying excise and customs duty on cigarettes on the basis of weight to a system based on the number of cigarettes. Between 1999 and 2010, there were no increases in tobacco excise and customs duty on tobacco products, apart from adjustments for CPI. Excise and customs duty was increased by 25 per cent on 30 April 2010. In 2013, the excise was further increased by 12.5 per cent per year for four years. That has seen the cost of cigarettes increase from about $15 per pack six years ago to around $25 to $30 at present.

Increasing the tobacco excise is just one of a number of strategies aimed at encouraging young people to quit smoking, as has been noted by previous speakers. It also aims to help stop people from commencing smoking in the first place, especially younger people, and is seen as an important step in reducing the prevalence of smoking in Australia.

Earlier this year, when the excise increase was first announced, the chief executive of the Cancer Council of Australia, Professor Sanchia Aranda, was reported as saying:

… price is an important factor in people's decision to smoke.

"Every time you increase the excise consumption goes down. We anticipate if there were four of these recurrent tobacco increases over time, that about 320,000 current smokers would attempt and be likely to quit as a result of all four increases, and about 40,000 teenagers would be deterred from taking up smoking. In the longer term that means tens of thousands of cancer deaths would be prevented …"

Another article reported Emeritus Professor Simon Chapman, from the University of Sydney's School of Public Health, as saying:

… tobacco control had been one of the great public health success stories of our time.

"Tobacco control is the poster child of chronic disease control," he said.

He explained that the tobacco excise worked like 'a vaccine against lung cancer'. He also said:

Price is the single most important factor in determining demand.

Now, this measure alone cannot reduce smoking rates.

Debate interrupted.