On GHW: Health benefits to outweigh lost revenues

Highlights of the interpellation
Graphic Health Warning Bill (Senate Bill No.27)
Continuation of the period of Interpellation
May 7, 2014

Sponsor: Senator Pia S. Cayetano (PSC)
Interpellator: Senator Juan Ponce Enrile (JPE)
Presiding Officer: Senate President Franklin M. Drilon (FMD)

On reducing smoking incidence

JPE: Has the passage of the Sin Tax Reform Law resulted to a decrease in smoking incidence among Filipinos?

PSC: We must remember that the Sin Tax Reform Law was primarily a revenue measure. This must be supported by other actions, including those being pushed under the Graphic Health Warning Bill. This is just one of the many measures that we must undertake as responsible policymakers to really have that impact on society – especially with the youth.

If I were asked if cigarette prices are now high enough to have a significant effect on the purchasing power [of smokers], I would say ‘no.’ And that is the position taken by all the experts – that cigarette prices must even be more expensive to be really prohibitive for the youth. This makes this measure still important in addition to the other laws we have passed in the past.

Graphic Health Warning Bill: ‘Burdensome’ to the tobacco industry?

JPE: There is a clash of two government policies here from the viewpoint of the national interest of the country: The first one is to administer to the health of the nation. Second, the other more important consideration for me, is the availability of money to administer to the health of the people. We cannot fund or run a government, no matter how much you want to serve the people, if it has no money to support any program. We have to know how far we can go to impose such burdensome requirements on a product which is a major source of revenue of the government.

PSC: I beg to disagree that the Graphic Health Warning Bill will be very burdensome. The printing and labelling requirements would just impose some changes in the beginning – laying the initial templates, and then after that you just roll it out. The initial cost has been estimated to amount to a few centavos [per pack]. In fact in our last hearing, all the tobacco companies there have agreed that this is a measure that they are willing to undertake.

JPE: While the manufacturers will probably not quibble about the additional expenses that they will incur in the printing cost of these warnings, on the other hand, the impact of these increases will not be on the manufacturers but on the consumers.

This product which is very difficult to discard, even if you know that there is a risk involved in taking them, because it becomes a habit already and you get addicted to them. And I understand the thrust of this measure — indeed to help control and decrease, and probably, if it is at all possible, to eliminate smoking. But if we do this, there is an impact on the efficiency and viability of government functions.

PSC: In fact, the manufacturers have quibbled about the effect of the graphic warning in terms of pricing in the last Congress. That is why I welcome their change of heart in the last hearing, in this Congress. Because for the first time after three Congresses, they have finally come to accept that this is a measure that is a socially responsible move on their part.

If the time will come that decrease in consumption will be so big that it would decrease revenues, I would like to believe that this should be looked as a positive thing. Because if you look at the economic loss, in terms of what government has to spend [to address tobacco related illnesses], it would definitely be larger than the revenues that is being brought in by tobacco smoking.

Tax revenues from tobacco products and benefits to tobacco farmers

FMD: The total revenue collected for tobacco alone for 2013 is P70,392,271,373 which is an almost a P42 billion increase with the new sin tax law.

Tobacco farmers benefited to the extent of P6.5 billion, which is 15% share from the reform tax measure that was passed.

JPE: That is not my interest Mr. President because if this bill will pass, and I think the tendency is indeed to reduce smoking in the country, as well as, if not to eliminate it, then that benefit to the rural population of the country living on tobacco products, through tobacco farming, would be eradicated.

Priority of Graphic Health Warning Bill: The youth

PSC: I’d like to emphasize that the focus of this measure is the youth. I’d like to hope that all of us will agree that it is our desire that we will not have more of our youth becoming addicted to smoking. And so if we will consider ourselves a success by way of bringing down smoking, especially among the youth, then I’d like to think that any other effect would be secondary.

Will government services suffer due to losses from tobacco tax revenues?

PSC: The health, social and economic cost due to smoking was estimated at P177 billion in 2011. Reducing smoking will curb government expenses in health because so many of the diseases – be it in the urban areas, in the rural areas, rich or poor – are aggravated by smoking.

I can say with much certainty that the negative effect on revenue collection can greatly be outweighed by the positive effects of a health community.

GHW Bill and compliance of countries with the FCTC (Framework Convention on Tobacco Control)

JPE: We have to be very cautious and careful in seeing to it that in adopting any policy, one policy of government will not hurt the other interests of the government. I’m not responsible for the people in their country. I’m responsible for the people of this country and their welfare. And I’m not going to just work or take any chances in adopting a policy that might endanger the entire country.

Other indicators of smoking prevalence

PSC: More than 100 billion sticks are sold and consumed per year. So that alone tells you that 100 billion sticks of cigarettes packed are inhaled by the person smoking and also have secondary smoke effect on the persons near them. That alone tells us that there is a huge number of our citizens that are affected by the detrimental hazards of cigarette smoking. And this data I am providing is for one cigarette company alone.

On balancing people’s health and the tobacco industry

PSC: The responsible thing to do is to create policies that will protect our people from harm and at the same time, balance the interest of the other members of the community. But definitely not to prevent responsible measures from being implemented because of their effects on members of the community that are a direct outcome of a detrimental product in the market.

Smoking in Cagayan households

JPE: In Cagayan, my province, this is a major tobacco producing province, sometimes the entire household smokes, but they do not smoke cigarette because they could not afford it, they smoke what they produce.

GHW Bill to counter marketing schemes that encourage the youth to smoke

PSC: Among the youth, in their schools, it is the cigarette smoke that they become familiar with because the marketing and whatever creative forms of marketing that are out there are done by the cigarette companies. These youth pick up from these marketing and advertising campaigns. All that we are trying to do with this measure is to provide counter-advertising to those [marketing campaigns]. By showing them in very graphic ways the ill effects of smoking.

What tobacco products are covered by the GHW Bill?

JPE: The bill covers all types of tobacco products; that they must contain picture-based warnings including cigars, chewing tobacco and sucking tobacco, and snapping [?] tobacco, and regardless of packaging whether it is in packets, in packages, in cartons hard or soft, or in pouches, or in cylindrical form, conical form, or rectangular form or whatever form.

PSC: Tobacco hand-made in the homes which are not commercially sold, or marketed, does not fall under the definition of this law. Because it is just hand-made and therefore, there would be no one to put a graphic health warning label on it.

Five out of top ten causes of morbidity can be linked to smoking

PSC: Heart disease, disease of the vascular system, pneumonia, tuberculosis, and chronic lower respiratory disease. These actually fall within the Top 7 of the Top 10.

What we are saying is that of the Top 10, five of these are also associated with tobacco smoking. It does not mean that every single person who died of heart disease, of tuberculosis, or pneumonia was a smoker. In fact many infants die of pneumonia.

JPE: When I was smoking I never suffered pneumonia, when I was not smoking then I got pneumonia. And I was confined in the Makati Medical Center, so that’s why I’m raising this so that we are not misled into believing that these statements are true.

Why Graphic Warning is more effective

JPE: Well you know not all people can analyze like we can. When they read a sentence, they take it as face value, unless we really clarify these statements, the impression is that five out of the 10 major causes of death in the country already come from tobacco smoking.

PSC: Your Honor raised a very good point, and that’s precisely why we have a graphic health warning bill. These are images so that people who have a hard time understanding words would easily be made aware of the ill effects of smoking. That will address misconceptions, misunderstandings, and perhaps even failures on the part of writers, or even health advocates, who have a hard time explaining by words, what can be depicted by pictures.

On textual health warnings

PSC: The move to shift to graphic based warning was a result of studies conducted in different countries that showed that the textual based warning was not sufficient. Because many times, the written words, you tend to gloss over it. And that is why the move to graphic based warning took hold when many countries found out that the simple statement that ‘Smoking may be dangerous to your health’ did not have the impact they expected it to have.

Tobacco lobby

JPE: If they did use text health warnings and discovered that picture based warnings were more effective, why is it that until now, there are other countries that have not yet implemented it?

PSC: The reason why there are no graphic warnings in our country and in a few countries that don’t have it is because of the tobacco lobby. In the countries that have the political will to pass this despite the pressures of the tobacco companies, they have been able to pass it. In this Congress alone we will see that after how many Congresses, it did not pass, precisely because of the desire of the tobacco companies to either prevent it from passing or delay it. I commend the tobacco companies who have expressed their support after three Congresses, because now we know we may be able to move forward with less resistance than we have encountered in the past.

Proof of tobacco lobby

JPE: Do we have any proof that some people in our legislative bodies were lobbied by cigarette companies?

PSC: I know from personal experience that they were really talking to many members and trying to delay it. That is my personal perception of the facts that caused the non-passage of the bill since the time that I first sponsored it.

JPE: If we adopted the text warning for tobacco products as far back as 2003 and studies were made already that picture based warning are more effective, the proper question to ask is when were these studies made known to us in the Philippines? And why did we not adopt a measure like this earlier? The answer is because of the lobby of the tobacco industry. Now, who were lobbied?

PSC: The tobacco lobby is the reason why the GHW Bill has not moved forward since the time I became chairman of the committee on health. A lot of my colleagues would have concerns which I feel were easily answered by the clear print of the bill itself. And knowing how on record the tobacco industry had posed their objection, it was clear to me that that lobby was effective.

What types of countries have adopted a GHW Law?

JPE: What are the 72 countries that have adopted this pictorial health warning and their types of economies?

PSC: We all have a general idea of the classification of countries as developed or developing. So if I may just put on record the wide range of countries that have picture based warnings – we have Argentina, Australia, Bahrain, Belgium, Brazil, Burkina Faso, Canada, El Salvador, Fiji, Egypt, Indonesia, Yemen, Vietnam, Taiwan, Switzerland, Sudan, Qatar, Peru, Oman, Malaysia. So I think it covers a wide range of economic models.

Are we passing the GHW Bill as mere compliance with FCTC?

JPE: How come the others have not hurriedly adopted this type of warning? What I heard is that we were supposed to adopt this as far back as 2008, and we have not done it. Is there a compulsion on us to do this, to adopt this kind of measure?

PSC: When we sign a convention, we do make an affirmative statement on our part that we will comply. So that has been the basis for our trying to do that when I first became chair. But at this point, I personally consider it irrelevant. I’m not doing it to meet any deadlines. Rather, I believe that it is the responsible action to take.

JPE: But there are many kinds of treaties. Some are mandatory, directory, some you enforce when you want to enforce, if you have the time to enforce it. We are talking of policy. Not to copy what other countries do, but to adopt a policy to serve the people.

PSC: If the question is: Are we doing this to just adopt what other countries are doing? We are not. We have long passed the deadline for compliance. I am putting it forward because I believe that this is relevant to our country. I do believe that it is relevant to other countries as well, but I cannot give you the individual reasons of the remaining 106 countries for non-passage.

JPE: Can we get from the Department of Foreign Affairs a listing of the countries that already complied with this, the 72 countries, and the countries that are not compliant yet, so that we will at least evaluate their situation in comparison to ours?

PSC: We can do that Mr President. But if his honor earlier made a statement that the decisions he would be making will be made regardless of what other countries were doing, I am just asking why now you would like to burden this sponsor with that information when he doesn’t believe that his actions would be affected by those other countries anyway? And I am also making my manifestation that I am putting this forward as a policy that is being initiated by our own Department of Health regardless of what other countries are doing. We make these decisions because it is what is best for our people and not what is best for other citizens of other countries. #

Photo: Sen. Pia Cayetano responds to questions posed by minority leader Sen. Juan Ponce Enrile on the proposed Graphic Health Warning Law.

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