The message of the sugar levy — drink makers are to blame for people getting fat

    17 March 2016

    After the campaigning comes the lowering of expectations. Jamie Oliver has won again and George Osborne has announced a sugar levy. Having threatened to ‘get more ninja’ if the government didn’t capitulate to his demands, Oliver now admits that he never expected the Government to tax soft drinks. But thanks to Osborne’s need to deflect attention from the state of the economy, it has done just that and there is now a dawning realisation that upping the price of a can of lemonade from 69p to 77p is going to make no difference to anything.

    Expectation management is now the name of the game. The BBC’s chief cheerleader for the tax, Nick Triggle, now accepts that any reduction in soft drink consumption will be trivial but argues that this misses the point because it ‘carries a symbolic message’. Writing in The Times, Tory paternalist Tim Montgomerie applauds the tax because it will, he hopes, ignite a debate. Jamie Oliver himself says that the tax is a ‘symbolic slap’ rather than the game changer he may previously have led you to believe.

    The sugar levy is expected to ‘raise’ (ie cost) £520 million. That’s a pretty large sum of money for a millionaire chef to deliver a ‘symbolic slap’ (ie empty gesture), especially since much of the cash will come from those who can least afford it. For the sugarphobes, the policy is important not for its intrinsic value but because it opens the door to further tobacco-style regulation of the food supply.

    But the sugar tax is symbolic for a subtler and more telling reason. It is not a sales tax. It is a levy on industry which amounts to a fine. Manufacturers will be taxed according to sugar content and sales volume. Osborne disingenuously claims that it will be up to the companies whether or not they pass the tax along to the consumer. Of course they will. There is no reason to think the manufacturers and importers will not treat the levy as a cost of doing business and raise prices accordingly. Sure enough, the Office for Budget Responsibility acknowledges that the £520 million the government expects to raise from the sugar levy ‘implies rates of 18 pence or 24 pence per litre unit charge according to sugar content, which we expect to be passed entirely on to the price paid by consumers’.

    This is a clumsy way to tax sugary drinks. The large drink manufacturers own many dozens of food and drink brands, including diet drinks and bottled water. There is no guarantee they will not raise the price of some of their other products to pay the levy. It would have been simpler for Osborne to introduce an 8p per can sales tax. Why didn’t he?

    This is where the symbolism comes in. The message is that drink makers are to blame for people getting fat. It is they who must take responsibility and it is they who must be punished (or be seen to be punished — consumers will ultimately pay the price).

    No wonder the sugar levy has received a rapturous welcome from so many quarters. It crystallises one of the great mantras of our times, that anything bad that happens to us must be somebody else’s fault. It cannot be us who are to blame for being lazy and greedy. The blame lies with those who fulfil our desires.

    Allied to this narcissistic delusion is the belief in the painless quick fix. In this instance, the quick fix is the notion that the food industry can magically reformulate its products by removing the calories and keeping the flavour. Let the boffins and eggheads sort it out while we stuff our faces.

    The great irony is that no part of the food and drink sector has done more to reformulate its products than the fizzy drink industry. Coca-Cola, for example, has created Diet Coke, Coke Zero and Coke Life as low- and no-sugar options. Pepsi has not marketed its full sugar brand in Britain for more than a decade, preferring to concentrate on Pepsi Max. These drinks have a significant market share but if they tasted as good as the originals everybody would switch to them.

    Consumers of diet drinks are making an implicit trade-off between flavour and calories. The inferior flavour is a cost, the lack of calories is a benefit. As always when trying to maintain a healthy weight, a little sacrifice and self-discipline is required.

    We know exactly what reformulated soft drinks taste like because they have been on the market for decades. What more reformulation does Osborne think possible? The real message of the sugar levy is that the Government won’t be satisfied until Coke is turned into Diet Coke. The fact that there are already three reduced sugar Coke brands on the market is not enough. Until we switch en masse to artificial sweeteners, we will be effectively fined.