Burgess COMMENTARY

Peter Burgess

Tackling the healthy diet price gap

BY: GRIFFIN CARPENTER July 15, 2015

The British Medical Association has hit the headlines by calling for a 20% tax on sugary drinks to fight our obesity epidemic. Despite the Coalition government ruling out a “sugar tax” last year after similar calls from public health bodies, the BMA, which represents 150,000 doctors, is pushing for the plan in an effort to improve public health.

The response from some corners has been denial – not that there is an obesity epidemic or a problem with our diets – but that fiscal measures are required. In their lead editorial yesterday The Telegraph writes that “education and labelling are far better weapons in the fight”. While this is the approach the government is currently taking, the results are mixed and unimpressive. The most well-known scheme in this area, the “five-a-day” guideline, has seen little to no change in public behaviour since its introduction. Other opponents of the plan have noted that a sugar tax scheme in Denmark was unpopular with the public, although popularity alone is not reason enough to avoid fiscal measures.

Meta-analyses from the World Health Organisation, the Food Research Collaboration, the Obesity Learning Centre, and academia confirm that taxation and subsidies do influence dietary behaviour. Changes in technological production have meant that processed foods like sugary drinks have become cheaper while fruits and vegetables have increased in price. The sad reality of our food system is that healthy diets are currently more expensive and the price gap is increasing.

While it is true that the poorest spend a higher portion of their income on sugary drinks (and on food and consumer goods in general), the entire point of this proposal is to change behaviour and the poor would also be the main beneficiaries of such a change. A proper cost-benefit and distributional analysis of a sugar tax would set the costs of higher prices to a particular group against the potential health benefits they are likely to receive from changes in behaviour.

As a sugar tax would raise revenue from purchases, this money could be used to offset distributional changes or to further close the price gap between diets. The proposal from the British Medical Association suggests that the funds could be used to subsidise fruit and vegetable consumption – a consideration in the proposal the detractors curiously ignore. The benefits of this subsidy would again impact the poor most as a higher portion of their income is spent on fruit and vegetables thus offsetting some of the direct financial impact.

This tax and subsidy approach is particularly promising given the existing research on fiscal approaches. A recent meta-analysis in the journal Nutrition noted that “to maximize success and effect, this review suggests that food taxes and subsidies should be a minimum of 10 to 15% and preferably used in tandem”.

This discussion of the details is important but the broader point shouldn’t be missed. Not one measure alone will solve the issue of obesity because the problem transcends the prices of sugary drinks and relates to the whole economic and social food environment in which we act. NEF research has shown that obesity is just one symptom of a more fundamentally broken food system. Why the price gap between diets exists in the first place, and whether some of that gap is policy-related is important to unpick. But in the system we find ourselves, fiscal measures such as the BMA’s proposed sugar tax combined with subsidies for healthy foods would improve the health of society and should be met with support.

Worryingly the government seems to be doubling down on its opposition to the idea. A report due last Friday from the government’s own Public Health England has been delayed, possibly due to its conclusions on this very topic. However unsavoury politically, the government must face the reality of obesity and seriously consider implementing fiscal measures.

The virtuous circle of wellbeing

JULY 12, 2015 // BY: ANNIE QUICK

We spend a lot of time at NEF thinking about how to achieve wellbeing – what are the drivers of wellbeing, and what policies can improve them? But how about asking the question the other way around: what impact do improvements in wellbeing have? How can personal wellbeing contribute to other social or economic outcomes?

This briefing paper, recently published by Novacroft, outlines some of the studies in this emerging field. For example, the effect of wellbeing on health: one review of 150 such studies found compelling evidence of a positive effect on a range of health outcomes.

Studies also found positive wellbeing impact on employment, autonomy at work and productivity. Being happy even seems to make us nicer: one review found that people with higher wellbeing, or who were induced into a better mood, were more sociable and extrovert, and more likely to express a liking for a stranger.

Establishing causation is notoriously difficult. Much of the research is now dated, and may not meet more robust modern standards. However, taken together with more recent studies, the variety of different measures, outcomes and methods provide a strong basis for the case that wellbeing is a cause, not just an effect, of other positive outcomes.

You could ask, so what? After all, at NEF we are strong advocates for the idea that equitable, sustainable wellbeing should be seen as a key outcome of the economy - rather than a fixation on the next GDP figures. We would see many more traditional policy indicators – particularly economic ones such as productivity – as means rather than ends. So why turn the tables?

First, some of these outcomes are likely to improve other peoples’ wellbeing. The evidence that wellbeing increases volunteering, for example, shows how increasing one person’s wellbeing might lead them to undertake activities which in turn produce benefits to other people’s wellbeing .

Second, it is notable that many of the drivers of wellbeing (income, volunteering, health) are the same factors which research suggests can also be improved by higher wellbeing itself. It’s likely that this points to a bi-directional relationship. In other words, as people feel happier, they build stronger relationships, contribute to a stronger society and are more successful in their own lives. This in turn contributes to their happiness, and the virtuous circle continues.

As we gain a better understanding of these relationships, policy-makers may be able to capitalise on this connection and improve wellbeing now and in the future. ISSUES