Cigarette firms lobbying retailers over plain packaging

Big tobacco has begun lobbying retailers on the impact of plain cigarette packaging on revenues, using advertisements in the trade press as well as on-the-ground reps.

According to a leading policy adviser on the cigarette packaging law in Australia, the first country to introduce it, this is just one aspect of a wider industry campaign being ramped up to "undermine" the measure.

Prof Mike Daube, who chaired the Australian expert advisory group on the issue, said tactics used by companies in Australia were likely to be adopted here due to fears of a "domino" legislative impact across the EU. "You [Ireland] can brace yourself for a massive lobbying and PR campaign and for claims that civilisation as we know it will end when plain packaging is implemented."

The Convenience Stores and Newsagents Association (CSNA) said there had already been advertisements and approaches from reps advising of detrimental effects to income.

An advertising campaign in recent months – targeting publications such as Checkout, Shelf-Life and Retail News – has drawn attention to the threat of smuggled cigarettes.

Retail prices

However, CSNA chief executive

Vincent Jennings

said that, by scrapping branding, Irish smokers would simply move to “value” brands, and the industry would raise wholesale prices, in effect squeezing middlemen vendors who are powerless to raise retail prices.

“These are the real reasons why we should oppose plain packaging – because it will cause growth in the value market. It’s not doing anything to prevent [people] smoking,” Mr Jennings said.

The average difference between premium and value brands is €1.60.

There are 13,000 licensed retailers for tobacco products, 7,500 of which are bars and nightclubs. Tobacco accounts for up to 5 per cent of turnover for large stores; 16 to 20 per cent for “symbol” stores like Centra and Spar; 25 per cent for traditional newsagents; and 35 per cent for service stations.

Prof Daube said efforts used by big tobacco in Australia included heavy political lobbying, advertising, criticism of “nanny state” policies, and a failed legal challenge in the high court.

Minister for Health James Reilly has said he is confident such challenges can be resisted.

Taoiseach Enda Kenny has been urged to abandon the plans by a consortium of US business lobbies.

Australian arguments

Prof Daube said the tobacco industry in Australia said it “wouldn’t work and it would put shopkeepers out of business. They said it would have a dramatic impact on the illicit trade. You will be getting all of these arguments [in Ireland].”

Figures published in Australia this month showed the lowest level of tobacco sales since 1959, prompting claims the measure has worked. Big tobacco disagrees, saying its own statistics point to a rise in sales.