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Sugar taxes and food promotion clampdown could follow PHE obesity report

22 Oct 15

LONDON (ShareCast) - (ShareCast News) - A report by UK public health officials has found sugar taxes are an effective tool to combat obesity and has called for restrictions on food manufacturers and supermarkets offering deals on unhealthy foods and marketing to children.
The report, 'Sugar Reduction: The evidence for action' from Public Health England, said the consumption of sugary foods and fizzy drinks was a key reason behind an obesity crisis that was costing the NHS roughly 5.1bn every year.

Alison Tedstone, director of diet and obesity at PHE, a government body formed to find ways of protecting and improve the nation's health, said "all the evidence shows a sugar tax does decrease purchases" of unhealthy food.

"The higher the tax increase, the greater the effect," she told parliament's health select committee.

Health secretary Jeremy Hunt was accused of initially suppressing the findings when they were first made last July, because they were "inconvenient" to ministers, but they were finally published this week as part of the committee's inquiry into childhood obesity.

The report, which noted that the government has already accepted the recommendation of the Scientific Advisory Committee on Nutrition (SACN) that guidelines for average maximum sugar intake should be halved, was damning on the effect of promotions on sugar consumption.

Food retail price promotions are more widespread in Britain than anywhere else in Europe, the review said, with foods on promotion accounting for around 40% of all UK expenditure on food and drinks consumed at home, and with higher-sugar products promoted more than other foods.

"Price promotions increase the amount of food and drink people buy by around one-fifth. These are purchases people would not make without the in-store promotions. They also increase the amount of sugar purchased from higher sugar foods and drinks by 6% overall and influence purchasing by all socioeconomic and demographic groups."

Listed companies that could be affected include producers of soft drinks such as Coca Cola HBC, Britvic, AG Barr and SAB Miller as well as supermarkets Tesco, Sainsbury's and Morrison's, sweet snacks makers such as Premier Foods and Finsbury Food, as well as sugar producers, including the like of Tate & Lyle and Associated British Foods. Food labelling may also need to change, while restaurants and cafes were also cited.

The report's eight main recommendations were:
1. Reduce and rebalance the number and type of price promotions in all retail outlets including supermarkets and convenience stores and the out of home sector (including restaurants, cafes and takeaways)
2. Significantly reduce opportunities to market and advertise high sugar food and drink products to children and adults across all media including digital platforms and through sponsorship
3. The setting of a clear definition for high sugar foods to aid with actions 1 and 2 above. Currently the only regulatory framework for doing this is via the Ofcom nutrient profiling model, which would benefit from being reviewed and strengthened
4. Introduction of a broad, structured and transparently monitored programme of gradual sugar reduction in everyday food and drink products, combined with reductions in portion size
5. Introduction of a price increase of a minimum of 10-20% on high sugar products through the use of a tax or levy such as on full sugar soft drinks, based on the emerging evidence of the impact of such measures in other countries
6. Adopt, implement and monitor the government buying standards for food and catering services (GBSF) across the public sector, including national and local government and the NHS to the ensure provision and sale of healthier food and drinks in hospitals, leisure centres etc
7. Ensure that accredited training in diet and health is routinely delivered to all of those who have opportunities to influence food choices in the catering, fitness and leisure sectors and others within local authorities
8. Continue to raise awareness of concerns around sugar levels in the diet to the public as well as health professionals, employers, the food industry etc., encourage action to reduce intakes and provide practical steps to help people lower their own and their families sugar intake

Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are end of day values only.


Market Data

Currency US Dollars
52 Week High $58.77
52 Week Low $29.71
Shares Issued 472.43m
Market Cap $17,730m


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