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Tackling Tobacco: A Step in the Right Direction?

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About The Author

Helen Morse (Writer)

Helen is studying Law (European & International) LLB at the University of Sheffield, now entering her final year having spent an Erasmus year at the University of Vienna, Austria. Helen is interested in international and commercial law. Outside of law, Helene is a keen sports woman, playing at county level.

The first few months of 2015 have seen a flurry of activity from the government concerning measures on the sale of cigarettes. In March MPs voted in favour of legislation on standardised, plain packaging for all tobacco products. Along with this, the final stage of implementing a complete ban on displaying cigarettes in stores became effective on the 6th April. These measures are designed to reduce the number of smokers in the UK, with a particular focus on cutting down those who take it up in the first place. However, there are major concerns that these new rules will put a disproportionate strain on small shops and businesses, especially as there is an apparent lack of evidence showing legislation on tobacco products is effective in reducing the number of people who smoke. 

The Law

Display Ban

The Health Act 2009 included provisions on the prohibition of tobacco displays. When the coalition government came into power in 2010, it confirmed it would implement legislation in England from April 2012 in large stores and April 2015 in all other stores.

Since 6th April 2015, it is now illegal for any store to display tobacco products at the point of sale to the public. The display of prices for cigarettes has also been restricted to a standardised format set out by law. Any person, including shop managers and shop workers, found guilty of not complying with the new legislation will be liable for a fine of up to £5000, to imprisonment for a term not exceeding 6 months or both on summary conviction. Alternatively, on conviction in the Crown Court, a guilty person will be liable for a fine, imprisonment for a term not exceeding two years, or both.

Standardised Packaging   

Using the powers enshrined in s. 94 (6) of the Children and Families Act 2014, which states that ‘the Secretary of State may by regulations make provision about the retail packaging of tobacco products,’ the government recently passed the Standardised Packaging of Tobacco Products Regulations 2015.

The Regulations make provision for the permitted colour, design and shape of tobacco products. Once again, to breach these new rules will be a criminal offence and a guilty person on summary conviction will be liable for a fine (unspecified in the legislation), to imprisonment for a term not exceeding three months or both, or on conviction on indictment will be liable for a fine, to imprisonment for a term not exceeding two years or both. The new rules are due to come into force on 20th May 2016. Labour has already pledged to introduce standardised packaging if it comes into power and it seems the other parties, except UKIP, would also support the legislation.

Evaluation

Many see the new laws and regulations as a welcome continuation of policy aimed at reducing the number of smokers in the UK and the associated health risks. Hazel Cheeseman, director of policy at Action on Smoking and Health (ASH), commented that ‘the display ban in small shops will work hand in hand with standardised packs….to further protect children from glitzy tobacco packaging.’ However, there are a number of concerns with the legislation and an issue with whether using the law is even the best way to tackle tobacco consumers in the first place.

Impact on Small Businesses

Firstly, there are fears small businesses will not be able to cope with the financial costs associated with the changes or the estimated fall in revenue. With regard to the ban on displaying cigarettes, it was estimated retailers of small stores would have to spend on average £4,965 to fit the required shelves and covers, which is a very large out-going for any small business. It is too early to assess what the actual economic impact has been for smaller retailers, but it should be highlighted that this estimate may have been overstated.

As noted by the government itself, evidence from the Canadian experience of removing tobacco displays indicates costs were usually more around the £1000 mark for small retailers. Even though this is still a significant amount for some businesses, I think this one-off-cost for retailers is worth the health benefits associated with reducing the number of smokers and the related financial savings, estimated to be around £520m based on lifetime health benefits arising from fewer people starting to smoke over a 10 year period.

However, there are also concerns that the legislation will impact negatively on the customer experience and the measures are an unnecessary burden on small businesses. The Scottish Grocers Federation claims the combination of a display ban and plain packaging will lead to longer transaction times, as it will be difficult for staff to locate stock. The Tobacco Retailers Alliance raised similar points saying the measures will jeopardise convenience and compromise retail efficiency. They feared customers may switch to larger outlets with more staff where they will not have to queue for so long. I do not feel that these arguments are all that persuasive, though.

Firstly, I would say the ‘convenience’ of small stores is due to their locality, not their fast, efficient serving time. I do not imagine smokers will make a special and often longer journey to a larger supermarket for a packet of cigarettes, as opposed to just popping down the road to a local store, just because the serving time may be reduced by a minute or so. On top of this, Christopher Street from Imperial Tobacco conceded that during trials, ‘serving times tended to increase at the start of the trials but once staff became accustomed to the modified units, they reduced,’ thus drastically weakening the arguments of those who feel the measures will result in operational burdens for small retailers.

That said, if the legislation and regulations have the impact they are hoped to have on smoking numbers, it is a legitimate speculation that some small retailers will not be able to cope with the loss of revenue. A report by Patrick Basham for the Institute of Economic Affairs claimed that 2,300 stores closed in Canada during 2008 when legislation of cigarette displays was introduced. That figure equates to one out of every seven shops, equivalent to over 10,000 shops closing in the UK. However, I would say to blame the shop closures solely on the ban on tobacco displays is not entirely fair as the world economic crash hit in 2008. Equally, Peter Chappell, a senior category manager from a company that operates over 570 stores in Canada, explained there was a ‘negative impact on sales for about the first three months’ but contrary to the above argument ‘now that the ban has had time to bed in, the full effect on tobacco sales can be measured. And the effect is nothing.’

Lack of Supporting Evidence

A second reason many are against the new laws on the sale of tobacco products is because of the argument there is a lack of supporting evidence of their effectiveness in tackling smoking numbers. The Tobacco Retailers’ Alliance raised the question of ‘how do we know the display ban will work in smaller shops,’ as ‘the introduction of the ban into larger shops hasn’t been evaluated?’ Equally, there is insufficient evidence, or at least only speculative evidence, on the overall success of display bans in other countries, as the measures are either in their infancy or studies are still ongoing.

Australia is the only other country at this stage to introduce plain packaging, but again evidence of its success varies depending on what side you fall. Supporters cite figures from Australia's Bureau of Statistics and the Department of Health which show that expenditure on tobacco products fell by more than A$100m since the introduction of the legislation. However, those from the tobacco industry highlight that the fall in smoking numbers in Australia has only been very slight. That said, despite this arguably inclusive evidence, one insightful point raised by Jon Donnison blogging for the BBC, who I am inclined to agree with, is that, if the legislation has really not worked in Australia, then why is the tobacco industry fighting its introduction in the UK so hard? 

Legal Paternalism

Finally, there is the argument that these measures are just another example of a ‘nanny-state’ or legal paternalism in action. Simon Clark, of the smokers lobby group Forest, said: ‘Consumers are fed up being patronised by politicians of all parties. Smokers know there are health risks associated with tobacco. Plain packaging won't make any difference.’ In a similar vein Nigel Farage, leader of UKIP, tweeted ‘Plain packaging is an appalling intrusion into consumer choice and the operation of the free market.’ Of course these points of view should be taken with caution, as they are from smokers who are arguably biased towards non-intervention from the government with regard to tobacco legislation. In fact a YouGov survey of 10,000 adults showed that 62% of the public actually supported plain packaging while only 11% opposed it.

Conclusion

Overall, despite the fact some have concerns with the impact of the legislation on small businesses and arguably the lack of conclusive evidence, I would be inclined to say that many of them are misplaced. Experience from other countries shows that businesses have not suffered as bad as UK retailers argue and it should also be remembered that all businesses must comply with the new measures, meaning no retailer will be at any more of a disadvantage. Of course statistics can always be read in a multitude of ways and in terms of assessing the effect of tobacco legislation it is by-and-large too early to tell. However, whilst there is no conclusive evidence showing the legislation is having a negative impact, I can see no reason why governments should not continue to use it as a tool to try to reduce smoking numbers. On top of all this, smoking is the leading cause of preventable illness and premature death, accounting for approximately 100,000 deaths a year in the UK. I think these preventable deaths need addressing with urgency and even if the combined impact of these new provisions is only modest, then I believe it is still worth it.

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Tagged: Commercial Law, Medical Law & Ethics, Retail

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