This briefing is a position statement by Action on Smoking and Health and FairPensions which aims to inform stakeholders in local authority pensions, including councillors, pension fund members, local taxpayers and pension fund trustees.Local authority pension funds and investments in the tobacco industry
Wednesday 22 November
There was good news for public health in today’s Budget announcement as the Chancellor renewed the tobacco tax “escalator” for the remainder of this parliament. Duty rates on all tobacco products will increase by 2% above (RPI) inflation and on hand rolling tobacco by 3% above (RPI) at 6pm today. The Minimum Excise Tax on cigarettes and the price at which it applies has been uprated in line with wider cigarette duty. The new MET will be £5.60 (previously £5.37) for a pack of 20 and will apply to cigarettes sold at or below £7.63 (previously £7.35) for a pack of 20 from 6.pm today. 
There is good evidence of the effectiveness of tax increases in reducing smoking prevalence both by encouraging quitting and discouraging uptake among young people, who are particularly price sensitive.  
Today’s announcements are in line with the recently published Tobacco Control Plan for England , which sets out targets for the reduction of smoking prevalence and the ambition to bring about a smokefree generation.
ASH Chief Executive Deborah Arnott said:
“We congratulate the Chancellor for renewing the tax escalator thereby committing to reducing the affordability of tobacco year on year during this parliament. These measures will help bring the end of the tobacco epidemic a step closer by discouraging young people from taking up smoking and encouraging adult smokers to quit.”
However, smoking prevalence remains high among the most vulnerable groups in our society. Among individuals in routine and manual socioeconomic groups the smoking rate rises up to 25%, among the unemployed it’s 30%, 40.5% among those with a serious mental illness, up to 77% among people experiencing homelessness and over 80% among prison populations.   More must continue to be done to tackle these inequalities.
Deborah Arnott continued:
“The Government has already highlighted the burning injustice that if you are born poor, you are likely to die up to ten years earlier than those who are better off. Smoking is the cause of around half of this difference. Poorer more disadvantaged smokers find it hardest to quit and the Government needs to do more to help not just by increasing taxation but also by ensuring they are offered evidence-based treatment to help them quit.”
HM Treasury have said that the changes add 28p to the price of a pack of 20 cigarettes, 41p to a 30g pack of hand-rolling tobacco (HRT), 14p to a 10g pack of cigars and 18p to a 30g pack of pipe tobacco.
Tobacco duties were forecast to rise by the predicted inflation level two quarters after Spring Budget (i.e. Q3). They are now forecast to rise by the predicted inflation level two quarters after an Autumn Budget (i.e. Q2 in the following year). In the first year of the new system, this inflation level has been reduced to reflect that not a full year elapsed between Spring Budget 2017 and Autumn Budget.
Notes and Links:
Action on Smoking and Health is a health charity working to eliminate the harm caused by tobacco use. For more information see: www.ash.org.uk/about-ash
ASH receives funding for its programme of work from Cancer Research UK and the British Heart Foundation.
ASH staff are available for interview and have an ISDN line. For more information contact ASH on 020 7404 0242 or out of hours Deborah Arnott on 07976 935 987 or Hazel Cheeseman on 07754 358 593.
 HMT. Autumn Budget 2017. 22 November 2017.
 The World Bank. Curbing the epidemic: governments and the economics of tobacco control. May, 1999.
 Amos A, Bauld L, Clifford D, et al. Tobacco control, inequalities in health and action at a local level. York, Public Health Research Consortium, 2011
 DH. Towards a smoke-free generation: a tobacco control plan for England. July 2017.
 ONS Adult Smoking Habits in England 2016. June 2017.
 ASH. The Stolen Years. 2016
The costs of smoking to the economy include the expense of treating diseases caused by smoking as well as reduced productivity and environmental costs. March 2017.
The Economics of Tobacco
ASH analysis of tobacco tax increases in the United KingdomTimeline_tax_increases.pdf
This document was created by ASH in partnership with the Royal College of Surgeons of Edinburgh, the Royal College of Anaesthetists and the Faculty of Public Health. It was endorsed by the Royal College of Surgeons, Royal College of Physicians and the Royal College of General Practitioners. It has been designed for health professionals and commissioners, to provide clear advice and examples of good practice in relation to smoking and surgery.Joint Briefing: Smoking and Surgery
ASH response to a National Audit Office consultation on reducing regulation.NAO_RRconsultation_ASHresponse.pdf
Reducing regulation: Consultation for businesses and civil society organisations – ASH ResponseASH-response-HMRC-licensing-consultation.pdf
ASH’s submission focuses on what the effect of these proposals might have on: (a) Differences in outcomes in richer and poorer areas and inter-authority competition and (b) the long-term future of redistribution to poorer areas and impacts on development.DCLG-Select-Committee-evidence-on-business-rates-ASH-Response.pdf
ASH’s response to the Health Select Committee inquiry into the impact of the Comprehensive Spending Review on health and social care.ASH-CRUK-HSC-submission-2015.pdf
ASH response to HM Treasury’s Spending Review 2015 consultation.HMTconsultation-response_SpendingReview2015_FINAL.pdf
ASH response to the Department of Health’s consultation on ‘Local Authority public health allocations 2015-16: In-year savings’.LA-spending-cuts-ASH-response-to-DH-consultation.pdf
A research report for ASH by Howard Reed, Landman Economics. February 2015A UK tobacco levy: The options for raising £500 million per year
ASH response to a Treasury consultation on a tobacco tax levy.ASH-Tobacco-Levy-consultation.pdf
ASH also commissioned this research report by Howard Reed of Landman Economics: