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Investing in Tobacco Control

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Call To Action

Since current tobacco control funding is insufficient to arrest the harm caused by tobacco use, all countries should develop new funding mechanisms to support tobacco control efforts.

Per-capita annual cost of the four “best buy” tobacco control measures

The exact global economic cost related to tobacco consumption is unknown, but it is likely over one trillion dollars per year. In the United States alone, the estimated annual smoking-attributable costs, including direct medical costs as well as the cost of lost productivity due to premature death and illness, amounted to more than USD289 billion annually on average for the years 2009 to 2012. The global cost of tobacco use is expected to increase due to increases in the number of tobacco-related disease cases, as well as the growing cost of health care.

A great part of these costs can be averted by investing in tobacco control, which fortunately, can bring to bear a set of evidence-based interventions that has proven to be effective. Policymakers and international donors can choose from a number of population-wide and individual-level measures listed in the WHO Framework Convention on Tobacco Control and its guidelines.

Despite its great return on investment, funding for tobacco control remains at levels that are inadequate compared to current needs, and far behind the level of funding directed toward addressing other health problems that cause far fewer deaths. The total annual cost of delivering core population-based tobacco control measures in all low- and middle-income countries is projected at only USD600 million, or USD0.11 per capita, while both domestic public funding and international development assistance for tobacco control remain at just a fraction of the need.

Few low- and middle-income countries have the experience and resources that could match those of the transnational tobacco industry. Therefore, international assistance for tobacco control is necessary, especially at the initial stages of the epidemic. Countries at later stages in the tobacco epidemic can share their tobacco control know-how, and new financing mechanisms could help the international community to raise the funds required to scale up implementation of the measures set out in the MPOWER package. In the long run, knowing the value of investing in tobacco control, each country must learn for itself how best to allocate the funds needed to address the tobacco epidemic.

New Financing Mechanisms

SOLIDARITY TOBACCO CONTRIBUTION, a concept developed by WHO, recommends that countries consider dedicating a part of their tobacco tax revenue toward international health-financing purposes, including international tobacco control.

MANDATORY SOLIDARITY LEVY ON AIRLINE TICKETS
in some countries supports scaling-up of treatments for HIV/AIDS and tuberculosis. Similar airline ticket taxes could support international tobacco control.

TOURISM TAXES and levies on financial transactions are other ideas to consider for financing international tobacco control efforts.

Cost Effectiveness: “With […] cost-effectiveness rivalled only by basic childhood immunisations, few public investments provide greater dividends” –World Health Organization, 1997

Cost-Benefit

Savings created by tobacco control interventions; in millions USD, 2013
 
MISSOURI, USA
TAIWAN, CHINA
UNITED KINGDOM
AUSTRALIA
GERMANY

 
Tobacco Prevention and Cessation Initiative: Smoke-free policy change
Outpatient Smoking Cessation Services program: Counseling and nicotine replacement therapy
Taxation: 5% increase in cigarette price
Australian National Tobacco Campaign: Intensive 6-month mass media
anti-smoking campaign
Smoke-free Class Competition: Reward non-smoking classes to
prevent students from becoming established smokers

NET SAVINGS
$62M
over remaining lifetime of 5761 quitters
$224M
over 15% years
$18,461M
over 50 years
$912M
over remaining lifetime of 190,000 quitters
$25M
over 1 year

EXAMPLES OF HOW THESE SAVINGS COULD BE SPENT
Annual budget for restoration and conservation of Missouri’s forests and wildlife.
Taiwan’s annual government budget for environmental protection.
Government annual spending on industry, agriculture and employment.
Australia’s annual governmental investment in early childhood education.
Government annual spending on helping ethnic Germans living in Eastern Europe.

Economic Costs

Direct and Indirect Tobacco-Attributable Costs as a Percentage of Gross Domestic Product

COUNTRY
YEAR
TOTAL COSTS AS A PERCENTAGE OF GDP
DIRECT COSTS AS A PERCENTAGE OF GDP
INDIRECT COSTS AS A PERCENTAGE OF GDP

CHINA
2008
0.64%
0.14%
0.50%

KOREA
2008
0.33%
0.09%
0.24%

US
2009-2012 avg.
2.00%
0.92%
1.08%

SWEDEN
2007
0.35%
0.10%
0.25%

Direct costs are the costs of treating tobacco-related disease borne by the healthcare systems. The main component of indirect costs is lost workplace productivity.

Health Funding

Development assistance for health in low- and middle-income countries (LMICs) which includes funding from bilateral and multilateral donors, non-governmental organizations, private foundations, and the corporate sector; by focus area, in millions USD, 2011

Direct costs are the costs of treating tobacco-related disease borne by the healthcare systems. The main component of indirect costs is lost workplace productivity.

$68M in 2011 was the total international assistance for tobacco control efforts in all low- and middle-income countries. This was also the amount spent EVERY THREE DAYS by the tobacco industry to advertise and promote its products in the United States of America.

IN 2011, ABOUT HALF OF ALL CONTRIBUTIONS made by public or private institutions from high-income countries to control tobacco use in LMICs came from just two donors: BLOOMBERG PHILANTHROPIES and THE BILL & MELINDA GATES FOUNDATION. While this assistance has been critical to progress in tobacco control, a wider variety of funders joining these two exemplary funders would provide a more secure and diverse assistance environment.

Governments collect nearly USD 145 billion in tobacco excise tax revenues each year, but spend less than USD 1 billion combined on tobacco control —and 96% of this is SPENT BY HIGH-INCOME COUNTRIES.

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