New figures show smoking costs billions more than tobacco taxes as consultation on creating a smokefree generation closes

Action on Smoking and Health (ASH) today publishes new figures showing the far-reaching impact smoking has on society on the day the consultation to create a smokefree generation closes. The charity says it demonstrates why action to make smoking history is needed and how this will benefit the whole of society.

Smoking costs England £49.2 billion each year in lost productivity and service costs, plus an additional £25.9 billion lost quality adjusted life years due to premature death from smoking. The figure for lost productivity is far greater than previous estimates as it includes areas of lost productivity where the impact of smoking has not previously been estimated.

One of the new areas of analysis is the loss to the economy from people spending their money on tobacco which generates fewer UK jobs and lower profit margins for retailers compared with other products and services people would purchase if they didn’t buy tobacco. This found that if no one bought tobacco in England the total benefit to the economy in gross value added would be £13.6 billion.

Howard Reed from Landman Economics who undertook the analysis underpinning the estimate of these costs, said:
“Smoking damages society in many ways that people are often unaware of. It is in fact the economic impact of tobacco, far more than healthcare, that creates the biggest costs to society. Local economies with the highest rates of smoking will also pay the highest price often compounding already high levels of disadvantage. A smokefree future is likely to benefit poorest communities the most.”

Conservative MP for Harrow East Bob Blackman CBE, said:
“The new analysis published by ASH showing the vast damage to the economy due to smoking comes as no surprise to me. As a former local council leader and MP I’m acutely aware that smoking inflicts damage to the whole local economy, not just the NHS, with people unable to work and needing social care on average ten years earlier because of the diseases and disability caused by smoking. The new figures are a timely reminder to local authorities and the NHS of why the government’s objective of creating a smokefree generation must be a priority for us all.”

The Government is proposing to raise the age of sale one year every year so that those born before 2009 will never be legally sold tobacco. Last month the new administration in New Zealand pledged to repeal a similar law as part of a coalition deal claiming it would enable them to cut taxes.

Chief Executive of ASH Deborah Arnott said:
“In New Zealand politicians have made the ludicrous claim that repealing their smokefree generation laws will allow them to cut taxes. The opposite is clearly the case. The cost of smoking to public services and public finances is far greater than the taxes tobacco raises, and there are multiple economic benefits from spending on products that have more value to the economy and create a healthier workforce.

“In England the tobacco tax take is £11.3 billion in 2023, but the cost to public finances and the economy is four times greater, so creating a smokefree generation is the prudent economic strategy for us, as it is for New Zealand.”

Alice Wiseman, Vice President of the Association of Directors of Public Health:
“These new figures reveal the sheer scale of cost that tobacco has on our society. We know that the majority of people who smoke start young and regret ever starting but, because they are addicted, struggle to quit.

“We know that this addiction causes untold harms to individuals’ health and that costs. It costs to provide health and social care and it costs the economy when people aren’t well enough to work. Today’s figures put a shocking price on these – and other – financial costs but what is impossible to calculate is the cost to the 64,000 families who lose a loved one every single year as a direct result of tobacco.

“We simply must make this legislation a reality.”

Last week ASH published new public opinion data showing that 67% of the English public back the measure with support high across those who plan to vote for all the major parties (74% Conservative, 72% Labour, 65% Liberal Democrat) showing the level of consensus across the political spectrum on protecting the next generation from the harms from smoking. [1]

Full break down of the costs of smoking to England
Total cost to England = £49.2 bn made up of:
Productivity costs = £32.0 bn

• Smoking related lost earnings = £9.3 bn
• Smoking related unemployment = £7.3 bn
• Smoking related early deaths = £1.8 bn
• Reduced GVA due to expenditure on tobacco = £13.6 bn

Healthcare costs = £1.9 bn
Social care costs = £15.0 bn

• Cost of domiciliary care = £644.3 m
• Cost of residential care= £588.1 m
• Cost of informal care by family & friends= £8.4 bn
• Cost of unmet care need= £5.4 bn
  

Fire costs = £328.1M

• Cost of deaths due to smoking attributable fires = £137.2 m
• Cost of injuries due to smoking attributable fires = £84.4 m
• Cost of property damage due to smoking attributable fires= £98.2M
• Annual cost to fire and rescue services due to smoking attributable fires = £8.3 m
  

ASH ready reckoner breakdowns are available for regions, local authorities: https://ash.org.uk/resources/view/ash-ready-reckoner and Integrated Care Board geographies: https://ash.org.uk/resources/view/ash-icb-ready-reckoner

NB
The estimates for fire costs have recently been updated for the Ready Reckoner. So the fire cost and total productivity and service cost in the ICB Ready Reckoner are very slightly different from the CBPF guide and APPG report (£49.2 bn as opposed to £49.3 bn)

The overall cost of smoking to England calculated by Landman Economics for ASH includes an additional £25.9 bn lost quality adjusted life years due to premature death which is not included in the Ready Reckoner calculations for breakdown by geographical areas for ICBs and local authorities.

Notes to the Editor
Action on Smoking and Health is a health charity working to eliminate the harm caused by tobacco use. ASH receives funding for its programme of work from Cancer Research UK and the British Heart Foundation.

Deborah Arnott, chief executive, Hazel Cheeseman Deputy Chief Executive, are available for media interviews contact press@ash.org.uk

Reference:
[1] Total sample size 3,533 adults, undertaken by YouGov online between 15th - 17th November 2023. Figures have been weighted and are representative of all adults in England (aged 18+).