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Tobacco Bill unjustified by government’s own impact assessment

Ivo Vegter is a columnist and the author of Extreme Environment, a book on environmental exaggeration and how it harms emerging economies. He writes on this and many other matters, from the perspective of individual liberty and free markets.

An impact assessment for the new Tobacco Bill fails to justify many of its provisions, such as the regulation of ‘electronic delivery systems’ and plain packaging for cigarettes. It is shot through with other flaws, which clearly makes this bad law.

The Control of Tobacco Products and Electronic Delivery Systems Bill (‘Tobacco Bill’), which is open for comment until 9 August 2018, imposes draconian new rules and restrictions on the sale and use of tobacco products, and controversially places electronic delivery systems (e-cigarettes or “vapes”) under harsh regulation.

The Bill extends restrictions on smoking in public places, introduces prohibitions on smoking in private places in which domestic employment is provided, further restricts advertising and communication about tobacco products, provides for standardised plain-paper packaging for tobacco products, prohibits the sale of tobacco products via the mail or over the internet, and applies all these restrictions to heated tobacco devices, water pipes and vapes, too.

As required by its own guideliness, the government also released a socio-economic impact assessment on the impact of the new Tobacco Bill. This is an unintentionally revealing document.

It was conducted by the chief director of the very same Department of Health that introduced the Bill. This is a clear conflict of interest, and introduces strong confirmation bias to the assessment.

From the outset, and throughout the document, it argues in favour of the legislation, using phrases like “more can, and should be done”. It reads like a motivation, rather than an objective assessment of the Bill’s likely benefits, risks and costs, which it’s supposed to be.

The document claims, without any citation, that the historic reduction in tobacco use in South Africa is attributable to government measures to restrict its public use, sale and advertising. The possibility of confounding factors, such as increased social awareness of the health risks of smoking, or lower social acceptability of both smoking and exposing others to smoke, are not even considered.

It makes this argument despite the fact that the reduction in tobacco use has “largely stalled”, despite increasingly draconian anti-smoking laws and ever-escalating sin taxes.

The assessment proposes three policy options, one of which is retaining the status quo, one of which places further restrictions on tobacco products and introduces restrictions on vaping devices, and one of which adopts the full extent of the World Health Organisation’s Framework Convention on Tobacco Control articles and guidelines.

It promptly dismisses options one and three, and declares the second option to be “preferred”. It is not clear by whom, or why. There is no assessment of the comparable costs and benefits of the other two options.

The document throughout assumes uncritically that the anticipated benefits claimed by the Department of Health will be realised. For example:

[The proposed measures] will support the core national priorities namely, (1) social cohesion and security, (2) economic inclusion, (3) economic growth and (4) environmental sustainability.”

Such assumptions are inappropriate in an assessment that according to government’s own guidelines is supposed to indicate whether or not costs, risks or benefits are over- or under-estimated. To say nothing of the trite vagueness of the claims in the example.

The assessment identifies deaths due to smoking – for which they can find no more recent statistics than 44,000 in the year 2000 – as a problem. It summarily ascribes this to the fact that current legislation allows for indoor smoking in 25% of public areas, under certain conditions. Considering that those areas are required to be isolated and separately ventilated, it is illogical to suppose that those deaths are due to second-hand smoke exposure. The obvious proximate cause of those deaths is, well, smoking. And smokers will smoke whether or not they are permitted to smoke in public places.

On the new plain packaging requirements, the assessment doesn’t assess anything either. It simply declares that people are attracted by product packaging, to such an extent that they’re too stupid to make rational decisions. It assumes, without providing any evidence, that people are misled about the relative safety of products by descriptions or colours. It states, again without any supporting evidence, that plain packaging will be more effective in making tobacco products less attractive.

In stating the risks and benefits of this measure, the assessment essentially repeats itself. It says that the risks are the “use of misleading descriptors” and “packaging used as a marketing tool to attract users”. Then it negates those to arrive at the benefits: “greater health awareness and less attractive packages to discourage use”. This is not how risk-benefit analysis works.

The risks include the potential for job losses, the potential for commercial revenue losses, especially for retailers, the distortion of market signals, unwittingly exposing consumers to lower quality products, entrenching large incumbents and strangling competition, and the loss of consumer freedom and choice.

Apparently, the proposed beneficiaries of this legislation will be the “poorest of the poor, youth and women” of South Africa. The reasoning for this statement is left as an exercise to the reader. One can only conclude that there is some reason why wealthy adult men will not benefit from the legislation, or perhaps deserve to die from smoking. Either that, or the author shows a clear ideological bias based on age, gender and class.

It makes a spurious argument about the “opportunity cost” for households of tobacco spending. While it is true that buying cigarettes precludes spending that money on food or other necessities, this is a trivial truism for any non-essential product. Would government prohibit the poor from buying toys, confectionery or trashy novels on the same grounds?

Besides, if the government is so concerned about how much the poor spend on cigarettes, it might consider reducing the extortionate taxes on a product that is physically and psychologically addictive. Those taxes, after all, are regressive, and hit the poorest of the poor the hardest.

The assessment assumes that tobacco use implies a burden on the healthcare system. However, it neglects to mention that smokers do the healthcare system a great service by dying significantly younger than their non-smoking counterparts. There is no attempt to evaluate how this reduces the burden of healthcare, which makes the supposed assessment of benefit incomplete, and perhaps inaccurate.

In listing the groups that will benefit or pay the cost, the assessment entirely fails to consider the potential fate of domestic workers. It is entirely conceivable that some smokers would prefer to fire their domestic workers, or curtail their working hours, instead of giving up the right to smoke in their own homes.

In assessing the cost to the hospitality industry, it makes some rather glib assumptions that leads it to conclude there will be no cost, and there might be benefits. Restaurants and other establishments open to the public have already incurred great expense in partitioning smoking areas. Those partitions are now obsolete, and most will likely want to remove them. This cost is not acknowledged.

The assessment goes on to suggest that the new laws might benefit the industry, because of higher occupancy rates and lower cleaning bills. This is not only baseless speculation, but it is also rather far-fetched. If higher occupancy were likely, simple commercial pressure would have induced most establishments to remove their smoking sections already. And cleaning is a necessary expense whether or not the customer smoked. Prohibiting indoor smoking won’t lead to reduced cleanliness in restaurants, but it would be troubling if it did.

This assessment of the effects on the hospitality industry is contradicted by the summary of consultations with business, which lists the negative economic consequences as more cost for businesses, which have already incurred costs to comply with existing legislation; loss of business and employment, disproportionately so for smaller venues; and costly enforcement.

The assessment claims that retailers foresee no impact to their revenue or employment levels as a result of measures that would forbid them to display tobacco products or tobacco advertising at point of sale. This may be true for large retailers, although it seems unlikely that lost sales will be made up by spending on other goods, as the assessment claims. However, the assessment author admits that they did not contact any representatives of small retailers or the informal sector, to canvass their views. Assuming that the legislation would not harm them is not justified, and neither is their exclusion from the consultation process.

A new ban on vending machines, apparently, “will have no impact on cigarette vending machine manufacturers and importers, because there has not been a demand for these machines for some years”.

This claim is unsubstantiated, and the report promptly contradicts itself by saying it would “imply the death knell for vending companies that vend only cigarettes and will hurt the more diversified vending companies”.

The assessment claims that the Department of Health invited only 13 stakeholders to make their views known, of which 11 responded. Of those, eight are industry associations or individual companies. The remaining three are all lobby groups that are strongly opposed to smoking, and strongly favour the WHO’s approach to tobacco control. They include the Tobacco Alcohol and Gambling (TAG) Advisory Advocacy and Action Group, Priority Cost Effective Lessons for Systems Strengthening (PRICELESS), and the National Council Against Smoking (NCAS). No attempt was made to interview organisations that might favour individual freedom and free markets, such as the Free Market Foundation, the Institute for Race Relations, the Centre for Development and Enterprise, or the soon-to-be-rebranded AfriSake.

This selective canvassing of opinions demonstrates a clear bias in the motivation for the Tobacco Bill, and makes the impact assessment practically worthless as an independent evaluation of benefits, costs and risks.

The Bill introduces a new restriction on commercial communications between a manufacturer or importer and its trade partners, business partners, employees and shareholders. Only “factual information” may be disclosed about a product, including vaping devices. This is limited to information on the characteristics of the relevant product, information on the availability and price of the relevant product, pictures of the product, information on its component parts; and information on its packaging.

This would make it illegal to include recommended usage instructions, for example. It would also make it impossible for tobacco companies to inform business partners and retailers about the relative benefits of harm-reduction products such as smokeless tobacco or devices that heat, but do not combust, tobacco. This is not only against the obvious interests of the tobacco and vaping companies, but also against the interests of consumers, who may never learn about options that might be less harmful to them than combustible tobacco products, or less unpleasant to intimate family, friends or bystanders.

Which brings us to vaping. Several years ago, I wrote that only the pharmaceutical industry and the tobacco industry wanted e-cigarette regulation. Vaping devices compete with tobacco products, threatening the traditional tobacco business. They also compete with nicotine delivery systems such as patches and chewing gum, sold by pharmacies to customers who wish to quit smoking.

In having to choose whether to regulate vapes as medical devices, as the pharmaceutical industry wanted, or as tobacco products, as the tobacco industry wanted, the government has sided with the tobacco industry. It did not even consider siding with consumers, instead of with some big business lobby or another.

Vaping devices are neither pharmaceutical products nor tobacco products. They sometimes deliver nicotine, but often deliver nothing but relatively harmless flavoured vapour.

The assessment considers nicotine to be toxic, but this is nonsense. Nicotine is not much different from caffeine in its stimulant effects. Pharmacologically speaking it is a drug generally regarded as safe. It’s the other stuff in tobacco products that will kill you.

Yet both kinds of vaping device – even those that do not deliver nicotine – will be harshly regulated under the Tobacco Bill, as if they were tobacco products.

The government’s impact assessment claims that although “the public health community remains unsure of a clear role of [vaping] in the area of tobacco control, [it] is agreeable on the need for regulation”.

This fact is not referenced in any documents. Even if it were, agreeableness to regulation among people who are not affected is hardly a sound basis for enacting regulation.

There is limited scientific evidence about the safety and usage patterns of vapes. The available evidence suggests vapes are relatively safe, and may well be effective as an alternative to smoking. However, the impact assessment argues in favour of strict vape regulations despite the absence of evidence of whether or not they are effective in reducing the demand for tobacco products. This makes such regulation clearly unjustified and premature.

Research about the efficacy of vapes to reduce or quit smoking is ambiguous. Some papers find that they make little difference, and are not significantly better than existing nicotine-replacement therapies. Others suggest quite remarkable rates of quitting, and that those who do quit often don’t take up vaping in the long term.

Surveys make it clear that for a majority of e-cigarette users, the motivation is to reduce smoking in order to reduce the harm to their health, or quit altogether. That this might be a public good is not acknowledged in the assessment.

Further study is certainly required to quantify the effectiveness of vaping as a smoking cessation aid, but then, they are not advertised as such. They are advertised as alternatives to tobacco smoking. And as such, they represent an obvious and significant reduction in harm.

The government is not interested in harm reduction, however. It insists on dictating that citizens shall do themselves no harm at all, and may not learn about ways to reduce harm to themselves.

In any other sphere of legislation, this opposition to harm reduction would be outrageous. Would the government withhold potentially life-saving drugs from the market because they work only some of the time? Would government prevent condom distribution because it encourages promiscuity, even though it substantially reduces the risks associated with sexual activity? Would government prohibit needle exchange programmes on the grounds that people shouldn’t be doing heroin in the first place? Would government reject reductions in industrial air pollution on the grounds that only the total elimination of air pollution is acceptable?

The Tobacco Bill gives the health minister the power to regulate the contents of vaping liquids, including flavourants. One can only imagine what someone like Aaron Motsoaledi might do with that power. Heaven forbid people actually take a modicum of pleasure during the difficult process of quitting smoking. Heaven forbid people take a modicum of pleasure from anything, other than eating vegetables and exercising, for that matter.

Some research points to legitimate concerns about the quality of vaping liquids. A reasonable case could be made for regulation specifically aimed at the safety of such liquids. However, this problem is not identified in the impact assessment at all, and no case for such limited regulation is made.

The only problem with vapes that is actually noted in the impact assessment is the risk that young people who use e-cigarettes are more susceptible to smoking tobacco. There is limited evidence for this claim, and certainly not enough to trigger draconian restrictions.

This risk is also substantially mitigated by the fact that very few people who have never smoked actually use e-cigarettes, and that some people successfully quit smoking by vaping. This point is not mentioned in the impact assessment.

The assessment makes a general statement about the fact that many vapes are bought and sold online, which would encourage “the free sale of products”. I have no idea what is so bad about the free sale of legal products, or what difference it makes whether one can buy these devices online or at a physical location.

One possible reason could be that the products are age-restricted, but the use of credit cards online largely eliminates the risk that children would buy these devices without the knowledge of their parents. If they do, the problem lies not with internet sales, but with the parents in question. Either way, the assessment fails to mention this argument.

The impact assessment bemoans the fact that vapes are being sold in a “legislative vacuum”, as if all products necessarily require enabling legislation before they might be sold. This is a wrong-headed way to look at markets. Government ought to permit the free sale of products until and unless they are proven to be substantially harmful to the general public, or harmful to consumers without adequate disclosure.

The assessment admits that regulating vapes as tobacco products “may slow down sales”, although it believes that it may not harm the industry “in absolute terms”, because it has grown rapidly in the past. This is patent hogwash, betraying an alarming lack of economic awareness. Removing the internet as a sales channel and prohibiting all advertising, including in-store display, will be disastrous for vape manufacturers and importers. There is just no way around that.

The document argues that vapes need to be regulated because they “present a potential risk to reduce the effectiveness of decades of tobacco control interventions”. There is no supportive argument for this claim, and it would in any case be an extraordinarily weak justification. It admits that further research is being conducted on the efficacy of these systems.

Ergo, they’re being regulated on a whim, in complete ignorance of whether they help or hinder the anti-tobacco cause. This is capricious government at its worst.

The assessment concedes that it simply excluded the opinions of stakeholders on vaping devices, since the only matter of concern was whether they ought to be regulated in the same manner as tobacco products.

Deep in the document, it lists as one of the costs of changing behaviour a “social re-engineering programme”. This is as ominous as it sounds. The government shouldn’t be in the business of social engineering.

After listing a host of potential compliance costs, the assessment concludes that the plain packaging costs will be carried by the industry, which apparently “minimises compliance costs”, and for all the other provisions, there will be “no compliance cost”. The author clearly finds it easy to simply shrug off the potential costs of compliance.

The socio-economic impact assessment on the Tobacco Bill is a truly awful piece of work, which dismally fails to accurately identify or assess all the potential benefits, risks or costs of the proposed legislation.

Laws are like sausages. It’s better not to see them made,” goes the quotation often (but probably apocryphally) attributed to Otto von Bismarck. Through the impact assessment, we can see clearly how the Tobacco Bill was made, and it leads to only one conclusion: it’s full of horse meat and listeriosis. DM


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