Is it finally time to tax sugary drinks?

Ask anyone who has come up against the power of the food and drinks industry – particularly if they have proposed regulations or taxes – and they will speak of the combination of charm and menace deployed against them and the ruthless determination to protect the interests of the business.

When, a year or so before the last general election, Andy Burnham, then Labour’s health spokesman, met executives at Coca-Cola to explain his plans for limiting the amount of sugar in fizzy drinks, it didn’t go down well. So you’re volunteering to man our complaint lines when millions of voters discover Labour has rewritten the recipe for Coke, demanded one executive.

And, when professor Geof Rayner, a former government adviser on obesity, wrote a letter to the Financial Times in 2014 suggesting that the sugar industry stop “marketing their products so aggressively and expensively”, he received a letter within days from AB Sugar, one of the world’s largest producers, seeking a meeting. “We believe that the public would benefit from a better overall understanding about the importance of healthy eating based on facts and scientific evidence,” it wrote. “Our thinking has continued to develop and I would really appreciate the opportunity to share this with you, given your expert knowledge in this area. We are, for example, working with the thinktank 2020Health to explore in more detail potential solutions to the issue of obesity.”

It transpired that the sugar giant had paid for a report by 2020Health – the thinktank is run by a former Tory parliamentary candidate – which poured scorn on the strategy of using taxes on sugar to tackle obesity as simplistic and dangerous to Britain’s economic prosperity.

Rayner, who did not meet AB Sugar, noted: “The sugar people have a lot to lose and therefore a lot of time and money to spend on lobbying and influence-seeking.”

More recently chef Jamie Oliver, leading the campaign for a tax on sugary drinks to tackle childhood obesity, has come under fire. He has been described as “misguided” and “led by the health lobby” by Gavin Partington, director general of the British Soft Drinks Association. The Food and Drink Federation, meanwhile, has barely been able to disguise its contempt, complaining that Oliver was pointlessly “demonising” one nutrient.

Perhaps, then, it should not have been surprising when, last October, it emerged that the prime minister had ruled out a tax on sugary drinks without even reading an official report from Public Health England backing the proposal.

It was a fight, it appeared, that Downing Street felt it could do without. The policy of voluntary agreements with the food and drink industry, best exemplified by the responsibility deals that encouraged better labelling of foods, would continue to be the government’s preferred path, it seemed.

But last week, despite the continuing bluster and charm from the industries, something changed.

Initially a front-page report in the Times suggested that David Cameron was open to the idea of a tax on sugary drinks. Then on Thursday he responded to a question at a press conference. Cameron said he did not want to resort to new taxes, but “what matters is we do make progress” on obesity. “We do have to recognise that we face potentially in Britain something of an obesity crisis when we look at the effect of obesity on not just diabetes but the effect on heart disease, potentially on cancer.”

Meanwhile, Cancer Research UK joined in, warning that obesity is escalating at such a rate that it would cause almost 700,000 extra cases of cancer within the next 20 years.

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The chain of events appeared to be choreographed and the Observer has since learned that the publication of Cameron’s childhood obesity strategy, originally due out this week, has been delayed. It is now likely to be seen in February, by which time No 10 will have been able to gauge public reaction to a tax on sugary drinks.

Ben Reynolds, deputy co-ordinator at Sustain, the main campaign group backing a tax, believes the moment may have come for a policy that for years has been castigated as an example of the overreaching nanny state. “It’s a real change in position”, he said. “We are really encouraged.”

So why now?

Professor Mike Rayner works at the Nuffield department of population health at Oxford University, which has been modelling the impact of so-called sin taxes (whether on fat or sugar) for a decade. He believes that there has been a perfect storm of factors. Oliver’s involvement has been key, he thinks, because Cameron listens to him. The support of the British Medical Association, the health select committee and even the British Retail Consortium has helped. But, perhaps most important, the “health lobby” has alighted on one policy among all the sin taxes, the case for which cannot easily be dismissed as regressive and likely only to hurt the worst off.

“It has become clear what we should tax,” Rayner said. “Health-related food taxes should be levied on sugary drinks, because it is the safest thing you can possibly do.

“All the alternatives to sugary drinks are healthier, even diet drinks. If you are going to shift from a sugary drink, you will substitute a healthier alternative.

“But if you tax sugary foods, for example, there are unintended consequences. The modelling we have done on taxing saturated fat, for example, has shown that you might achieve a reduction, but you lose from an increase in salt consumption because of the foods people move on to. Sugary drinks are the low-hanging fruit.”

Children consume three times more sugar than is recommended, and soft drinks are the biggest source, accounting for 29% of the sugar intake of 11-18 year-olds and 16% for younger children. Last week the British Medical Journal published a study showing that a 10% sugary drinks tax in Mexico had led to a 12% reduction in sales after a year. In 2013, Rayner, with others, published a study modelling how a higher 20% tax on sugary drinks, as proposed by campaigners here, would play out in Britain.

They believe prices would go up, consumers would look elsewhere and the tax would reduce obesity in the UK by 1.3%. A smallish number, but significant, especially given the disproportionate use of these drinks among lower socioeconomic groups, said Dr Sarah Wollaston MP, the Conservative chair of the health select committee. “Nobody is suggesting for one minute that a sugary drinks tax will solve everything. It needs to be so much more, but I would say that we should have the same approach as the British cycling team: you have incremental gains, each bit helps us to get a bit further to where we want to be.

“My advice to the prime minister would be don’t rule it out. Look at the advantages, and people don’t have to buy the drinks and pay the tax. Just like the plastic bag tax, it just changes behaviour. It is such an easy bullet because you just take a big chunk of sugar out of their diet without penalising them.

“I think the danger we have of the widening inequality and the sheer catastrophic implications on the NHS budget offer reason to go ahead.”

FACTS AND FIGURES

■ The Scientific Advisory Committee on Nutrition recommends that sugar should account for a maximum of 5% of energy intake for adults and children. It now stands at about 15% for children.

■ Sugar-sweetened drinks account for 29% of sugar consumption among young people aged 11-18 and about 16% for younger children and adults.

■ 12% of three-year-olds have tooth decay, rising to 28% of children by the time they turn five.

■ Tooth decay is the most common reason for children aged between five and nine to be admitted to hospital.

■ Public Health England says a high sugar intake is associated with deprivation. The National Diet and Nutrition Survey found higher sugar intakes in adults in the lowest income group compared to all other groups. Consumption of sugary soft drinks was also found to be higher in adults and teenagers in the lowest income group.