Portfolio Committee on Health David Crow Managing Director BAT South Africa

1. Portfolio Committee on HealthDavid CrowManaging DirectorBAT South Africa

2. Who we are • BAT is the largest tobacco manufacturer in SA • We sell 70%of legal tobacco products bought in SA • Our company employs 2300 people • We purchase 60% of the South African tobacco crop • We have invested more than R127 million in corporate social investment activities in the last four years • Our parent company, the second largest tobacco company in the world, is 30% South African-owned

3. Our approach to tobacco regulation • We support balanced regulation of tobacco products • South Africa has the opportunity to lead the world in regulating tobacco harm reduction • The requirements of the WHO FCTC are substantially met by the Act as it stands • We are committed to working with all stakeholders to reduce the negative health impact of tobacco use

4. Issues raised in our submission • Reducing the negative health impact of tobacco use • Definitions • Brand Element • Organised Activity • Tobacco Product • Standards for Manufacturing and Export of tobacco products • The Minister’s Wide Regulatory Powers • Ignition Propensity of Cigarettes

5. Issues raised in our submission • Reducing the health impact of tobacco use • Reducing the health impact of tobacco use • Definitions • Brand Element • Organised Activity • Tobacco Product • Standards for Manufacturing and Export of tobacco products • The Minister’s Wide Regulatory Power • Ignition Propensity of Cigarettes • Organised activity • The Minister’s wide regulatory powers • Ignition propensity of cigarettes

6. What is Harm Reduction? • Harm reduction is an established public health priority • Harm reduction examples include • free condom distribution • low fat content in foods • sugar free products • low alcohol products • safety glass and air bags in vehicles • Parliament must seek pragmatic rather than abolitionist solutions • Parliament now has the opportunity to lay a meaningful foundation for regulated tobacco harm reduction

7. Reducing the negative health impact of tobacco • There are many facets to potential tobacco harm reduction • lower tar and nicotine intake • reducing the number of smokers • reducing the amount people smoke • eliminating underage consumption • limiting public exposure to environmental tobacco smoke (ETS) • alternative methods of nicotine ingestion such as smokeless tobacco products like Swedish style snus • Some of these are open to debate

8. Two approaches to harm reduction • Abolition • Abstinence – ‘quit or die’ • Harm Reduction • Accepts that people will continue to take risks, but by reducing the scale/nature of the risks, and tries to mitigate the harm that might otherwise result

9. Reducing the health impact of tobacco • Quote from the ACSH released on 10 October 2006: “Smokeless tobacco use is a much-ignored means of reducing the overwhelming health risks of smoking.............point out that the public health establishment has misled smokers about the benefits and risks of substituting smokeless tobacco for cigarettes.” • “Stop scaremongering, snus is saving many lives in Sweden”Rutqvist and Ramstrom, Dagens Medicin 2006

10. Reducing the health impact of tobacco • The following bodies have advocated snus as a harm reduction alternative: • The Royal College of Physicians • Institute for Tobacco Studies, Sweden • American Council on Science and Health • WHO’s International Agency for Research on Cancer • Action on Smoking and Health • University of Louisville

11. Reducing harm – a solution • Regulators have an obligation to acknowledge the concept of tobacco harm reduction as a viable and necessary alternative to abstinence • Harm reduction products should be regulated, but separately from conventional tobacco products • For this reason the existing definition of “tobacco product” in the currentActneeds to be retained, thereby excluding harm reduction products such as Swedish style snus

12. Reducing harm – a solution 4. The Department of Health needs to urgently engage constructively with all stakeholders, including the tobacco industry to: • understand the dynamics of tobacco harm reduction • establish a solid foundation for regulating tobacco harm reduction • implement a holistic tobacco harm reduction framework

13. Organised activity • The definition of “organised activity” has been amended to include a “tobacco manufacturer’s company name”. • This will prohibit manufacturers from the normal business practice of hosting corporate stakeholder events which are not associated with consumers or aimed at the promotion of its tobacco brands

14. The Minister’s wide regulatory powers • The Bill provides wide powers for the Minister of Health to regulate tobacco products and their consumption • Section 6(1)(e) of theexisting Act gives the Minister power to change: ‘any other matter required or permitted to be prescribed in terms of a provision of this Act to achieve the objects of the Act’ • If the proposed amendments are passed, material changes to the control of tobacco products could be made without Parliamentary involvement

15. The Minister’s wide regulatory powers • For example the Minister could regulate: • the disclosure of confidential marketing expenditure and research data • the standards for manufacturing of tobacco products • the standards for other sovereign countries that receive tobacco exports from South Africa • the ignition propensity of cigarettes • The role of Parliament is being undermined • The Constitutional Court recently highlighted the imperative of proper public participation • The separation of legislative and executive powers needs to be protected

16. Ignition propensity of cigarettes • A very new concept in the industry • American Standard adopted by only 2 American states and Canada • Rejected by New Zealand regulatory authorities due to the lack of an appropriate testing standard • Minimal global research conducted on unintended negative consequences • Possibly being promoted for commercial advantage by a US tobacco manufacturer who hold certain patent rights • Dr Johnson-Hill is available for technical information

17. Summary • There are less harmful tobacco products available for smokers • South Africa has the ability to lead the world in implementing a substantially new way to regulate tobacco • Parliament now has the opportunity to lay a meaningful foundation for regulated tobacco harm reduction • Harm reduction is an established public health priority

18. Summary • Parliament needs to ensure that its power remains intact and is not usurped by the Minister • Organised activity needs revision • The Department of Health should be cautioned against the impact of unintended negative consequences of over- regulating the tobacco industry • Over-regulation can exacerbate the scourge of illicit trade as generally only legitimate manufacturers can afford to comply with many of the regulations • Over-regulation can exclude the Parliamentary process • Ignition propensity of ‘fire safe’ cigarettes needs in depth research

19. Thank you

21. Supplementary information

22. Illicit trade in tobacco products in SA • The trade in illicit tobacco products in South Africa has reached alarming proportions • In certain areas of Gauteng upwards of 4 out of 10 cigarettes consumed are illegal • Consumers buys 10 million illegal cigarettes everyday • Government is losing over R1,2 billion rand per annum to illicit trade in tobacco products

23. Prevalence of smoking and snus use in Sweden Data Statistics Sweden 1988-89 and 1996-97. Public Health Institute 2004.

24. Swedish style snus • Swedish style snus is made of moist, ground tobacco that is pasteurised and packed in small sachets • The sachets are placed between the gum and upper lip • Snus products are not burnt or smoked hence the absence of environmental tobacco smoke • Snus is not associated with lung disease

25. A ‘safer’ alternative?

26. Harm Reduction References • The Royal College of Physicians - www.rcplondon.ac.uk • American Council on Science and Health – www.acsh.org/news • Tobacco-Harm Reduction Research, University of Louisville, Kentucky USA - www.smokersonly.org • University of Alberta, Canada -www.tobaccoharmreduction.org • Action on Smoking and Health - www.ash.org.uk