Over the last decade, the nation’s increasing waistbands and sedentary lifestyle have resulted in an obesity crisis. This has resulted in continued calls for measures and release of the government’s Childhood Obesity Strategy, alongside a consultation on the sugar tax (view the consultation).
Sugar’s role in poor dietary health has come under particular scrutiny in the UK after the Government’s Scientific Advisory Committee on Nutrition (SACN) recommended that the average person’s maximum intake of sugar should not exceed 5% of their total dietary energy, i.e., considerably below current levels which are estimated at between 12% and 15% of energy requirements.
Will a sugar tax even work?
Everyone agrees that action needs to be taken on obesity. But, simply taxing the public may not be the solution. What is needed is a far more holistic approach. Taken simply the solution is to adjust the basic equation of food consumption so that ‘energy in’ is equal to or less than ‘energy expended’.
This is a very simplistic view however, and in part this is also why a sugar tax may not work, as it cannot be empirically proven to reduce ‘energy in’ in any material way.
Research has shown that the taxes in other markets have not been effective. The French experience of a similar tax is that it had a short term reduction in consumption followed by a return to historical levels – probably as people substituted to other either cheaper products in the same category or a different product with a similar sugar profile. Even the lauded Mexican example has been shown to only have an impact of reducing sugar by 6 calories in a diet of about 3000. It’s a drop in the ocean and certainly not the golden bullet.
What about the UK model? If independent research conducted by Oxford Economics is right, then a sugar tax in the UK would result in a reduction of about 5 calories, something but clearly not a solution. And, worse, at this time of great economic uncertainty it'd cost £132m to the economy, about 4000 jobs and circa £1b in direct costs to consumers in year one. A very heavy price for 5 calories each.
Taxation alone can't work and there is scepticism that even if there was an economically justifiable reason for it – the legality may be questionable.
How have food manufacturers been tackling the issue?
The sector has already done considerable work on reformulation, removing millions of calories, together with changes to portion and pack sizes, under commitments made as part of the Public Health Responsibility Deal; the updated formulations sit within the new nutrition guidance.
Nevertheless, manufacturers realise there is still more to do and are already attempting to get ahead of the regulatory curve. Significantly, in a recent survey conducted by DWF and Raconteur Publishing, with over 100 C-Suite executives from leading food businesses, 95% per cent of manufacturers said they envisage reducing the sugar composition of their food over the next two years compared with just 22 per cent who are looking at using natural substitutes such as stevia.
Food labelling has been a hot topic ever since the EU Food Information to Consumer’s act (FIC) came in in 2014, with nutrition labelling becoming mandatory in December 2016.
The Government’s Childhood Obesity Strategy seems to be muddying the waters again. In the UK we have front of pack traffic light labels, a government scheme, which includes sugars and tells you if the level is high, medium or low based on the number of grams of sugar against the recommended daily amount.
This means that presently most products will tell you sugar levels twice using a consistent measure, grams. The new strategy suggests that this is not clear enough for consumers, and their sugar app launched earlier this year decided to use sugar cubes. Now, not content with that it is now being suggested in the government's press release that we should use teaspoons as the front of pack measure, another subjective measurement (does this mean a level teaspoon? A heaped teaspoon?) causing confusion for consumers not clarification.
This needs to be simple and consistent as otherwise people will just ignore it and do what they think is right.
How to prepare?
We are still two years away from the tax and much still needs to be explored. Until the end of the consultation we will be unsure about how a sugar tax may be implemented and if it will be susceptible to legal challenge. It also waits to be seen how the new strategy and Brexit will affect future compliance with EU regulations such as FIC. Time will tell if this new Government will listen to the concerns of consumers and the industry and create a policy that helps tackle the obesity crisis, without placing strain on a sector which has already taken huge strides in product reformulation.
If you have concerns about what the Government’s Childhood Obesity Strategy and what a sugar levy may mean for you, please don’t hesitate to get in touch with Dominic Watkins, Head of food or anyone in the DWF Food Team.
DWF Future of Food Manufacturing Report
We spoke to over 100 C-Suite executives at leading Food Manufacturers in the UK to find out about the key areas of growth alongside some of the key challenges facing the industry in a period of unprecedented technological and cultural change.
The report combines DWF's legal expertise with insights from some of the UK's top food manufacturers. Essential reading for everyone involved in delivering growth in food.