Tobacco giant Philip Morris used a secret Senate hearing to warn that the soaring trade in illegal cigarettes could wipe out legal products in Australia as soon as 2030. The company argued that executives' identities should be kept secret due to threats from organized crime.
Secret Hearing Sparks Controversy
Labor criticized Coalition MPs for allowing Philip Morris to give evidence to an inquiry on illegal tobacco in a closed-door session in Canberra on Monday. This ended more than 15 years of precedent under a World Health Organization (WHO) agreement. Australia is a signatory to the WHO framework convention on tobacco control, which aims to prevent interference in public health policy from cigarette manufacturers and calls for transparency around evidence from tobacco companies when required in decision-making.
Guardian Australia revealed that the evidence delivered in a private 'in camera' session included dire warnings about the rise of illegal and unregulated tobacco products. The company also warned that some multinational manufacturers could exit the Australian market due to declining legal sales. The federal government's illicit tobacco and e-cigarette commissioner told the inquiry that illegal tobacco sales account for between 50% and 60% of the Australian tobacco market today, with those sales worth as much as $6.9 billion.
Company Pushes for Lower Excise
Executives are understood to have argued that lowering federal tobacco excise would undercut hidden market operators. However, anti-smoking campaigners, the Greens, and the federal government all criticized the committee chair and South Australian Liberal senator, Leah Blyth, for facilitating the private hearing. The company made a public submission to the inquiry but was not included on published programs. Efforts by Guardian Australia to seek responses about the hearing went unanswered.
It emerged on Tuesday that Philip Morris employees also gave evidence 'in camera' to a NSW parliamentary inquiry into the illegal tobacco trade in February. A transcript of that hearing shows three unnamed witnesses employed by the company answered questions in the inquiry chaired by Shooters, Fishers and Farmers party member Robert Borsak.
Government Response
The federal customs minister, Julian Hill, said tobacco manufacturers had failed to answer questions from the government's illicit tobacco commissioner about commercial data and supply chains. 'Big tobacco has been caught out globally over decades for selling their surplus production into illegal markets on the side, and Australians deserve transparency and proof that big tobacco are not complicit in illicit tobacco in our country,' he said on Tuesday. 'Australia will not get into a bidding war with organized crime on the price of tobacco or surrender our health policy.'
The health minister, Mark Butler, wrote to Blyth and other MPs ahead of this week's hearing, reminding them of the WHO guidance agreement and health department guidance on engagement with tobacco manufacturers. He urged MPs from all parties to stick to the WHO agreement, first signed by the Howard government in 2004. 'We think, particularly if industry is giving evidence about ways in which public decisions will impact their profits, that they should be answerable for that evidence,' he said.
Health Experts Condemn Secrecy
The Cancer Council and the Australian Council on Smoking and Health were scathing about the secrecy. Heart Foundation chief medical adviser, Prof Garry Jennings, said the committee had 'invited the enemy into the war room.' 'Big tobacco will simply argue for a reduction in excise so it can sell more cigarettes legally. It has no interest in public health or safety, which is what this nuanced discussion is about. But disappointingly, we have no way of knowing what they discussed with the committee,' he said. He added that the rise in illegal tobacco sales was concerning and should be dealt with through better detection and enforcement.
Lung Foundation Australia chief executive, Mark Brooke, said it was concerning that the evidence had been heard in secret. 'Transparency must be non-negotiable. Our position is clear. We need stronger enforcement, tougher penalties, and decisive action to shut down illegal operators, not secrecy,' he said.
