Tobacco lobby told Government: branding ban will cost you millions

Department of Health civil servants met lobbyists from the cigarette manufacturer Imperial Tobacco before the Government shelved proposals to introduce plain packaging laws this week, it can be revealed.

The lobbyists warned the health officials that the plans could cost the Treasury hundreds of millions of pounds in lost income.

Two representatives from the Bristol-based British tobacco giant – producers of Davidoff, Gauloises, West, John Player Special and Golden Virginia – met three economists from the Department of Health (DoH) and its tobacco programme manager in January this year.

According to a redacted note of the meeting released under the Freedom of Information Act this week, Richard Ross and Colin Wragg, Imperial Tobacco’s UK head of political affairs and head of corporate and legal affairs, wanted to discuss the financial impact of the Government’s proposals to introduce plain packaging laws.

The first item discussed was “cost areas” associated with the proposals.

Imperial warned the possible effect would be “critical to the industry and Treasury”. It said the Treasury lost £3bn a year in unpaid duty and VAT on illicit tobacco and warned that for every 1 per cent increase in illegal tobacco the Treasury could lose “£110m-plus”.

The lobbyists added the proposals would result in losses of “several hundred millions”. They then “stressed” that 70,000 jobs rely either directly or indirectly on the tobacco supply chain in the UK.

Three months after the meeting in April, a minister familiar with the consultation process, speaking on the condition of anonymity, told The Independent: “My concern is that the tobacco companies have inveigled their way into persuading a number of important players to reject standardised packaging.”

The Imperial figures are disputed by anti-tobacco campaigners who claim the illicit market has been on a downward trend since 2000. Speaking yesterday, Deborah Arnott, chief executive of the charity Action on Smoking and Health, said: “The tobacco industry clearly tried to use this meeting with officials to lobby against standard packaging rather than provide any hard evidence.” She added: “Industry figures on smuggling are way higher than any government or independent analysis.”

Whitehall sources confirmed the plan was being put on hold on Thursday. The development came as Imperial posted its first fall in half-year profits in 17 years this week as cigarette volumes sold in Europe dropped. The company holds a 45 per cent share of the UK tobacco market.

A Department of Health spokesman said: “Any decision to take further action will be taken only after full consideration of the consultation responses, evidence and other relevant information.”

An Imperial spokesman said: “We’ve said that there’s no credible evidence to suggest that plain packaging would reduce tobacco consumption.”