Budget bodes opportunity to better nation’s economic and physical health

• Combatting NCDs requires a concerted and sincere effort

By Patrick De Silva 

During a recent discussion that centred on the impact of Non-Communicable Diseases in Sri Lanka, it was revealed that 75% of deaths in the country were the result of NCDs, with one in five such deaths recorded as premature. These details are corroborated by the World Health Organization that lists 34% of these deaths under cardiovascular disease. 

The forum also outlined possible measures to control the spread of NCDs, which logically includes the control of tobacco and alcohol consumption, or abuse, corrective salt and sugar intake and environmental factors. Naturally, a lot of attention fell on alcohol and tobacco control, and rightly so, as Sri Lanka is a hotspot for their abuse on a per capita basis. The WHO website on its campaign for action on NCDs lists that 33% of Sri Lankan males are smokers. 

What was missing from the discussion was the need for action at government and non-government level on controlling tobacco and alcohol consumption through the informal sector. It is easy for Government agencies and NGOs to focus rhetoric and attention on the legitimate trade, as they are established identifiable institutions. But it is duplicitous to turn a blind eye on the informal sector that does further harm to health and society with similar – or far worse – products, and proclaim to conduct a concerted effort to control alcohol and tobacco consumption in the country. 

Alcohol and tobacco products in Sri Lanka are by no means cheap, and daily wage earners spill a considerable amount of earnings at taverns island wide, whilst cigarettes in Sri Lanka are amongst the most expensive in the world following a recent price hike in August this year, whereby a single stick cost as much as Rs. 60. A careful consideration of pricing, distribution and consumption will reveal that alcohol and tobacco abuse in Sri Lanka is rife due to the illicit and informal sector, but very little is being done to tackle that problem due to the lack of real consideration, courage and even political will. 

There is a lot said with respect to eliminating tobacco consumption from Sri Lanka, but this can never become reality. In fact, the WHO’s website on NCDs points to a planned reduction in tobacco consumption in Sri Lanka to 20% by the year 2020, which establishes the Organization’s perspective on the matter. The target for India was an optimistic 17% for the same year, and 30% for Thailand. Factors like smokeless tobacco consumption are major issues in the South Asian region, which amount to 90% of users, but with very little happening to control its spread. 

Any effort to reduce smoking-related harm in Sri Lankan must entail action to control the illicit and informal sector represented by the beedi trade. There are over 500 licensed beedi manufacturers in Sri Lanka, and numerous reports point to a universe of over 4 billion beedi sticks consumed annually in the country. The produce is sold at established retail outlets island wide for a mere Rs. 5 a stick, though little records exist in relation to the number of brands, sub-contractors and persons engaged in the trade. There is no regulation whatsoever with respect to the production or distribution of beedi in any manner. 

However, unlike Sri Lanka’s illicit alcohol trade which dwarfs legitimate production and is sold underground, beedis are sold at identifiable and often registered retail outlets. Wherein, policymakers are presented the chance to impose a degree of controls on price and distribution. As alluded to before, a beedi is priced at a mere Rs. 5, which opens up a huge disparity against the price of cigarettes in the country, leading to easy access for all economic groups and even youngsters. 

If the Government were to devise a mechanism to impose a sales tax on beedi at point of sale, this would serve to enhance Government earnings and take a progressive step towards controlling tobacco-related harm in the island. 

Budget 2019 presents every opportunity for the Government to take a quick and effective step in this direction to meet the 2025 target, and engage the informal sector in this national process. It must do so for the purpose of enhancing revenue, health, reducing social harm, ensuring public safety and security. The incremental savings generated by this measure would amount to tens of billions of rupees annually. 

In Sri Lanka, 103,500 persons die each year from NCDs, and the Government incurs substantial costs to provide healthcare to those suffering from these diseases an even more. Over Rs. 180 billion is spent by the state on the health sector alone annually. NCDs are avoidable through careful planning, effective communication, regulation and stringent execution. It is imperative that policymakers consider these informal sectors in its efforts, and impose controls wherever necessary to support its wider development goals. 

For instance, a tax on beedi to the effect of Rs. 3 per stick could generate over Rs. 12 billion in revenue to government, and potentially reduce smoking in that segment by 7% annually. Budget 2019 presents an ideal opportunity for Government to spell out such policy even in a staggered manner, plus, take effective steps to secure the economic and physical well-being of this country and its people. 

(Patrick De Silva is an attorney-at-law and serves as a regulatory affairs consultant to leading agronomic institutions in Sri Lanka and Australia with over four decades of experience. He can be reached at [email protected].)