PRA welcome the Government’s decision not to adopt plain packaging for tobacco products

Published 12/07/2013 00:00:00 in Press Releases

The Petrol Retailers’ Association (PRA) today welcomed the Government's decision, following their extensive consultation, to shelve proposals for standardised (plain) packaging for tobacco products. 

Brian Madderson, Chairman of the PRA said “Our members have been deeply concerned about the unintended consequences of this proposal, and we therefore welcome the Government’s decision to support business and focus its efforts on rebuilding the economy.

“Whilst we wholeheartedly agree with the Government’s aim of reducing youth smoking rates, there is no credible evidence to show that plain packaging would achieve this result - but there is significant evidence that such a policy would negatively impact our economy and boost the illicit tobacco trade."

Research carried out in Australia, the only country to implement plain packaging to date, plus recent reports in the UK have shown just how devastating the introduction of plain packaging could be for independent forecourt retailers and the UK economy:

  • The Centre for Economic and Business Research (Cebr) estimate that plain packaging would cause a reduction in the gross earnings of small independent retailers from tobacco of £12 to £20 million which, given the current state of the retail sector could result in insolvencies and the loss of between 2,000 and 3,500 FTE jobs in convenience retail. The same report also states the Treasury could lose up to £6 billion in lost revenue and compensation from such a policy.
  • The Cebr also predict that a policy of plain packaging could significantly increase the illicit tobacco trade by over 26% in cigarettes alone - an issue which the National Audit Office have recently shown that HMRC are already struggling to deal with - further taking revenue away from legitimate retailers.
  • Three out of four retailers in Australia believe that plain packaging is having a negative impact on their business overall. As a direct result of this legislation they are experiencing additional burdens such as increased transaction times, incorrect orders, consumer complaints, out of stocks and stock control times.

The retail sector makes a key contribution to the British economy.  PRA represent 5,500 small, independent retailers, supporting jobs in communities across the United Kingdom. Tough economic times and wave after wave of new regulation is making life tough.  Another 175 forecourts closed across the UK last year alone and 6,000 have closed since 1998. 

ENDS

Notes for editors:

Brian Madderson, Chairman, Petrol Retailers Association, Retail Motor Industry Federation

The Petrol Retailers Association represents some 5,500 independent forecourts which is 60% of the total UK marker. A trade association committed to helping members run their businesses legally and profitably adapting to new challenges in the market place.  A survey of Members to assess their reaction to the plain packaging proposals was undertaken by Populus in autumn 2012 to better inform the Government consultation.

  • Two-thirds (65%) of PRA Retailers believe that if the Government decided to proceed forward with plain packaging that it would have a negative impact on their business.
  • This increases to 71% among those that say direct tobacco sales are important to their bottom line and to 73% among those that say indirect tobacco sales are important to their bottom line.  

The Centre for Economic and Business Research’s report titled Quantification of the economic impact of plain packaging for tobacco products in the UK, can be found at http://www.cebr.com/reports/impact-of-plain-packaging/

The National Audit Office’s report, Progress in Tobacco Smuggling can be accessed at http://www.nao.org.uk/wp-content/uploads/2013/06/10120-001-Tobacco-smuggling-Full-report.pdf

The details of the research released by the Australasian Association of Convenience Stores can be found at http://www.aacs.org.au/new-research-confirms-retailers-plain-packaging-fears/

Keely Scanlan, Press Officer
Mob: 07825 097 697
Press Office direct line: 020 7307 3422
Press Office fax: 020 7307 3406

Web: www.rmif.co.uk Email: rupal.rawal@rmif.co.uk
The Retail Motor Industry represents the interests of operators in England, Wales, Scotland, Northern Ireland and the Isle of Man providing sales and services to motorists and businesses.

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