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Financial Resolution No. 2: Tobacco Products Tax (Continued)

Wednesday, 5 December 2012

Dáil Éireann Debate
Vol. 785 No. 2

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Deputy Denis Naughten: Information on Denis Naughten Zoom on Denis Naughten I welcome the opportunity to speak on this matter and I wish to deal specifically with Financial Resolution No. 1 concerning the tax on alcohol products. A detailed proposal was put to the Department of Finance to introduce a lid levy which would bring in about €240 million. The proposal before us will bring in about €180 million. The difficulty is that, while a detailed report was published earlier this year by my colleague, Deputy Shortall, on the national substance misuse strategy, there is nothing in the proposal before us to deal with the demand aspect of alcohol.

There is a precedent for this. A few years ago, there was a proposal to increase excise duty on alcopops because of the health issues involved. At present, over half of Irish 16-years-olds have been drunk and one in five is a weekly drinker. According to the latest available statistics, from 2008, there were 88 alcohol-related deaths per month. It is also a significant contributing factor in suicide. Every night, about 2,000 bednights are tied up by alcohol-related conditions. It is, therefore, having a major impact on the economy and is costing about €3.7 billion, half of which is taking money directly away from the health budget. There was an opportunity to nuance the proposal before us. The steering group report refers to increasing excise across the board thus making alcohol more expensive, but it also highlights below cost sales of alcohol and suggests proposals in that regard.

The strategy examined minimum pricing and suggested that it should be introduced. It has already been introduced in Scotland. All it is doing here, however, is increasing the profits of the drinks industry. The proposed lid levy on the other hand would increase revenue coming in to the Exchequer that could be put into other diversionary tactics on alcohol and substance abuse. It would have helped to implement the strategy as set out in the substance misuse report. I am disappointed that it has not been addressed here today.

Deputy Micheál Martin: Information on Micheál Martin Zoom on Micheál Martin As regards the alcohol proposal, I concur with our finance spokesperson, Deputy Michael McGrath, that the emphasis is the wrong way around. There is a fundamental problem with how alcohol is sold in this country. It is having a major impact on our young people. There is not a Deputy in the House who would not agree with me when I say that something has to be done about it. It means our taxation structure must be reorientated in a way that disincentivises the purchase of alcohol in the off-trade sector, particular in large multiples.

The safest place to have a drink now is in a pub. We must re-examine this matter again but the problem is that the public house has been outbid on pricing by other centres. We have youngsters buying big slabs and ending up on the greens. At home, there is no proper measure of what one is drinking, be it wine or spirits. One of the safest places to have a drink, therefore, is in a pub. I am talking about quantity and the public health perspective. The emphasis in the Government's approach is wrong. We had a different approach by putting the emphasis on the off-trade, and particularly trying to counteract the situation where large multiples have become significant players in the sale of alcohol, which was never intended. The taxation proposal before us misses a fundamental opportunity to redress that situation in addition to other proposals.

Our document contained an interesting proposal on tobacco which we received from the Irish Cancer Society and the Irish Heart Foundation. They made the point that the tobacco sector's revenue from a packet of cigarettes has increased from €1 to €1.84 in the decade to 2010. Therefore, despite all the increases in tobacco taxes, the industry itself has increased its take from the consumer over that decade. Essentially, the industry has used the opportunity offered by tax increases on tobacco to increase its own profits.

We have endorsed the proposals of the Irish Heart Foundation and the Irish Cancer Society that tobacco prices should be controlled in the same way as energy prices and taxi fares. With such a change, the proportion of the retail price of tobacco going to the Exchequer would increase. Without imposing hardship on individual smokers, the Exchequer could get a far greater yield if the proposal of the Irish Heart Foundation and the Irish Cancer Society was to be adopted. It could raise in the order of €100 million in the first year and €150 million in subsequent years. The measure that is being proposed today is completely inadequate from a public health perspective. It lacks innovation and a targeted approach which would target the industry and the profit share it garners annually, to such an extent that it has gone from €1 to €1.80 per packet over the past ten years.

An Ceann Comhairle: Information on Seán Barrett Zoom on Seán Barrett I remind Deputies that there are only five minutes left in this slot.

Deputy Robert Troy: Information on Robert Troy Zoom on Robert Troy I wish to raise my concerns about the increase in and excess of off-trade drink consumption. Everyone is concerned by the increase in alcohol consumption in recent years but the Government is tackling the wrong section on this matter. Over the last five years, turnover is down by 34% and we are losing licensed premises at the rate of one pub per day. The on-trade sector is far more labour intensive than the off-trade one and supports 50,000 jobs.

There seems to be no regulation of the quantity that people are drinking, and young people in particular. Young people are getting drink for as little as, or less than, €1 a bottle, yet nothing is being done to tackle this problem. We were led to believe that the Government was bringing forward proposals on below-cost selling. Young adults can buy alcohol for as little as 70 cent a bottle, yet nothing is being done to tackle this. At the same time, we have pubs closing day by day and there is no support from the Government.

The pub was always the lifeblood of rural communities where people could socialise. It was a way in which older people could deal with the problem of isolation. However, nothing is being done to tackle the real problem of alcohol consumption, which is that multiples are using alcohol to attract customers. They do not care who drinks it or what happens to them as a result. The wrong emphasis is being placed on this matter. What will the Government do about the number of jobs this measure will cause to be lost in the on-trade sector? Nothing is being done to support rural pubs.

An Ceann Comhairle: Information on Seán Barrett Zoom on Seán Barrett I call Deputy Boyd Barrett.

Deputy Róisín Shortall: Information on Róisín Shortall Zoom on Róisín Shortall A Cheann Comhairle-----

An Ceann Comhairle: Information on Seán Barrett Zoom on Seán Barrett There are three minutes left.

Deputy Joe Higgins: Information on Joe Higgins Zoom on Joe Higgins A Cheann Comhairle-----

An Ceann Comhairle: Information on Seán Barrett Zoom on Seán Barrett Do not blame me now. Twenty minutes have been agreed for this group of things, after which I am obliged to put the question. I am calling Deputy Boyd Barrett. I took people strictly in the way they have lifted their hands.

Deputy Joe Higgins: Information on Joe Higgins Zoom on Joe Higgins The Government can give us an extra five minutes on this.

An Ceann Comhairle: Information on Seán Barrett Zoom on Seán Barrett No. I cannot do anything about this. The motion has been agreed and was discussed by the Whips. It is not my business. Deputy Boyd Barrett, please proceed.

Deputy Richard Boyd Barrett: Information on Richard Boyd Barrett Zoom on Richard Boyd Barrett I will try to be brief to give the other Deputies time. This measure has nothing to do with public health, but it has everything to do with grabbing more money in a regressive way that will yet again hit the least well-off. This will hit those on the lowest incomes. It is precisely the gross inequalities in our society, widespread unemployment and poverty that will fuel addiction to cigarettes and alcohol, with all the problems that entails. Those are the things the Government needs to deal with if it wants to improve public health.

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