Cameron never wanted a sugar tax. His real plan will be almost as radical

    16 February 2016

    David Cameron’s on-off relationship with sugar taxes looks to be at an end. A trial separation has been announced while he plays the field of other policies.

    Fair weather friends of the Prime Minister were in shock over the weekend. Tam Fry of the National Obesity Forum said: ‘The decision must be reversed or it will be more proof that the Government is in the thrall of the food industry and the sugar barons will have won yet again. NHS chiefs know full well that the combination of child and adult obesity could topple the UK’s most cherished institution.’

    A statement accusing the government of being in thrall to ‘sugar barons’ and predicting the collapse of the NHS would normally be a shoo-in for most hysterical overreaction of the day, but Mr Fry was no match for Graham MacGregor, chairman of Action on Sugar, who is threatening to flee to South America. ‘Everything he [Cameron] does ends up in chaos,’ said MacGregor. ‘This was his one opportunity to achieve a legacy. He will be a Prime Minister who has achieved nothing. We won’t stop and if the UK doesn’t want to stop doing it [sic], we will go to another country like Argentina or Chile which are much better organised in terms of public health and nutrition.’

    When the idea of a sugar tax was first mooted, Cameron explicitly rejected it. Then, after a sustained campaign from Jamie Oliver and Action on Sugar, it was put back on the table. It has now been taken off the table but will be considered if the food industry does not comply ‘voluntarily’ with the government’s demands.

    I am quite sure that Cameron’s first reaction to the sugar tax was his gut reaction. I would wager that taxing sugar was never seriously in the frame. It would be unpopular with the Conservative grassroots and with the public at large. Although some opinion polls have shown increasing support for the idea, the government will have learned lessons from Denmark where initial support for a fat tax withered away once it was seen to be regressive, inflationary and ineffective.

    If a sugar tax was never in contention, why did the government re-open this can of worms by claiming last month that it was ‘back on the table’? I think there are two reasons.

    The first is that the government cannot legislate for much of what it wants to do. Food labelling is an EU competence, for example. The traffic light system used on most food products is not there by law but by voluntary agreement with the industry. If the government wants to change food labelling it can only do so in practice by persuading industry.

    The EU might also have something to say about Britain putting mandatory limits on how much sugar, fat and salt could go into food and drink products (as Cameron is rumoured to want), but even if Westminster could legislate for this in theory, it would be a legal nightmare in practice. Imagine the vast bureaucracy required to set mandatory limits for thousands of different products, both domestic and imported. Product reformulation cannot realistically happen by force of law. Much better to have a quasi-voluntary approach backed up with the threat of a sugar tax, but threats are only effective when they are credible.

    The second reason why a sugar tax has been kept on the table is that it helps make the government’s other proposals look moderate by comparison. Make no mistake, they are not. There is talk of banning discounts and price promotions, which would be as damaging to low-income consumers as a tax on soft drinks, as well as banning all sorts of food and drink advertising before 9pm, which would be disastrous for commercial broadcasters. This, along with mandatory controls over sugar, salt and fat content, amounts to a degree of state control of the food supply that is unprecedented in Britain’s peace-time history, but by raising the spectre of a sugar tax the government has shifted the Overton window in the direction of greater state regulation. People are now expecting dramatic policy changes. So long as it holds back on the sugar tax, anything will seem moderate.

    If this is Cameron’s public relations strategy, the likes of Jamie Oliver and Graham MacGregor are his useful idiots. Whatever appears in the forthcoming obesity strategy will seem sensible and restrained compared to the demands of the fanatics.

    But this strategy can only work in the short term. By raising — and then dashing — expectations about a tax that was never likely to be implemented, Cameron has made some permanent enemies. Despite his bizarre rant, MacGregor will probably not go to Argentina. Instead he will remain in the UK to be a thorn in the government’s side, along with Tam Fry, Sarah Wollaston, Jamie Oliver, the British Medical Association, the Lancet and everybody else who has scented blood in recent months. This could sow the seeds of future problems.

    On the other hand, Cameron may have realised that such people can never be appeased. He may have decided that since the ‘public health’ lobby are always complaining, he might as well give them something to complain about.