Vol. 528 No. 1
5 Mr. Shatter asked the Taoiseach his views on whether tobacco products should be removed from the basket of products contained in the consumer price index as recommended in the report of the Oireachtas Joint Committee on Health and Children, "entitled Health and Smoking: a National Anti-Smoking Strategy". [27372/00]
The consumer price index is designed to measure inflation. To do this it must reflect the change in the prices being charged for the full range of consumer goods and services available on the market. As considerable expenditure is incurred on tobacco products, they must be covered in the CPI for it to provide an accurate measure of inflation. This is consistent with standard international practice.
The Oireachtas Joint Committee recommended that a supplementary index excluding tobacco products should be published by the Central Statistics Office. I am informed by the CSO that such an index has been compiled and published as part of the monthly statement since January 1999.
Is the Minister of State aware that on budget day the Minister for Finance, Deputy McCreevy, informed the House that he intended to engage in discussions with the Central Statistics Office regarding the total removal of cigarettes and other tobacco products from the basket of items from which the consumer price index is calculated? Have discussions taken place on this issue? Is the Minister of State aware that the Joint Committee on Health and Children unanimously recommended that tobacco products be removed from the CPI and is he aware that the Belgian Government took a similar decision some time ago? Does the Minister for Finance propose to take any initiative in this regard?
This is a much discussed subject. The joint committee recommended that a supplementary index, excluding tobacco, be published. I am told by the Central Statistics Office that such an index has been compiled and published since January 1999. A second index is available which does not include the tobacco component. The Minister for Finance, in the Budget Statement, said he wanted to consider the question of including tobacco in inflation calculations. He is considering whether the inclusion of tobacco products is appropriate in measuring inflation. The Central Statistics Office publishes both sets of figures.
I am the author of the report to which the Minister of State refers. Is he aware that the joint committee made no recommendation regarding a supplementary index? The joint committee recommended that tobacco products be removed totally from the consumer price index. Has the Minister of State read the report? In the 13 months since the report was published and laid before the House, has any initiative been taken to follow up this matter? Given the belief outside the House that the Government has made a commitment in this area, can the Minister confirm that no Government decision has been made to remove tobacco products from the consumer price index?
I am not aware of a Government decision to remove tobacco from the index. The joint committee made a recommendation that there be a supplementary index, but it also recommended that agreement be obtained from the EU for the removal of tobacco products from all EU consumer price baskets. I accept what Deputy Shatter says about the Belgian situation but it has been international practice until now to include tobacco in indices. The Minister for Finance is examining this matter. The CSO compiles the index in both formats and it will respond to whatever instructions it receives from the Government in due course.
Every year there are 7,000 deaths in this State from tobacco related illnesses. Given the advice from the joint committee and the World Health Organisation that increasing tobacco taxes reduces youth smoking, does the Minister of State accept that any coherent policy to tackle the scourge of tobacco in this country should include annual increases on tobacco taxes? Does the Minister agree that the only reason there was not an increase this year was the fear of the impact of such an increase on the CPI? In the recent budget the Government decided to sacrifice the health of young people to keep down the cost of living statistics. This was necessary because of the failure of the Government, over 13 months to take any initiative to implement the recommendation of the Joint Committee on Health and Children.
The Deputy is speaking of the Government which put the largest ever tax increase on cigarettes in a single budget. The Government shares his concern about this matter.
The Government backed off the problem this year.
We imposed the largest ever increase. The previous Government had the same opportunity but it did not take it. This is not a political issue. People are dying from this product and it behoves all of us to do everything possible to prevent them from smoking and to reduce the pain they are suffering because of it. This is a technical issue which deals with how the rate of inflation is compiled. The matter is being studied by the Minister for Finance.
It is a health issue, not a technical issue.
