Last Friday, the Sydney University executive began a discussion on banning the sale and promotion of soft drinks on campus.
This follows significant momentum around taxing beverages with a high sugar content. At the same time as the presidential election, voters in several US cities voted in favour of imposing 1-2 penny per ounce taxes on soft drinks. Before our federal election, Richard di Natale unilaterally announced his support for a 20 per cent sugar tax.
Given what we know about the role of sugar in causing obesity and disease, these policy initiatives appear initially to be a relatively easy way to reduce sugar consumption and improve public health. But there a number of problems with this blunt approach.
The basic logic of taxing or banning sugar consumption is that doing so will change consumer behaviour. The evidence on the effectiveness of sugar taxes in this regard is very mixed. Proponents often cite a 12 per cent reduction in sugar consumption in Mexico after it implemented a 10 per cent sugar tax. But similar measures in Berkeley, California and Denmark, have failed to induce much of a change in consumption patterns.
There are a number of reasons why these taxes might not reduce consumption. One important economic reason is that cheap sugary goods tend to be relatively price inelastic, meaning that a tax significantly higher than 1-2c per ounce would probably be required to have the desired public health impact.
This matters because the burden of consumption taxes is overwhelmingly borne by poorer people. A badly designed sugar tax could end up hurting poorer people without producing many benefits, while one that might work would have to be more punitive, and would therefore require compensation to avoid over-burdening the poor.
But this just creates another problem, given compensation is relatively easily repealed by a government wishing to maintain the revenue benefits without footing the compensation costs.
How does this relate to the proposed Sydney University ban? Well, the exact same problems are at play, plus more. First, it’s unlikely a ban on the sale of soft drinks would seriously curtail consumption of those goods when they are readily available elsewhere outside campus. We would also likely see a substitution effect towards juice drinks and milk products – which appear to be exempt under the proposal – that have very similar sugar content to soft drinks.
Analogously to the broader imposts of a sugar tax, students face ever-increasing financial and time constraints that contribute to the consumption of cheap sugary goods. The USyd plan is said to involve “phasing out the sale of sugary drinks on campus; regulating the promotion of the drinks, including at events run by students’ societies; promoting healthier alternatives; and providing more water fountains”. Perhaps providing free healthy lunches or meal vouchers, more scholarships, and cheaper student housing would lead to better health outcomes for students than additional water fountains.
Supporters of the USyd ban will likely compare it favourably to the campus smoking ban instituted in 2012. But the analogy falls apart on anything more than a cursory glance. Arguably the smoking ban was also excessively punitive, with only a handful of designated smoking areas in far flung parts of the campus. But more obviously, drinking a soft drink doesn’t directly harm or inconvenience others like smoking does.
A final galling aspect of the sugar proposal is that it seems a rather cheap piece of tokenism when one considers the University of Sydney’s woeful record on a range of social justice issues, from failing to support marriage equality to refusing to fully divest from fossil fuels.
If the university were serious about leading the way on reducing societal harms caused by sugar consumption, it could divest from any holdings it has in confectionary and soft drink companies, and put more money into public health research. There is a growing understanding in public health circles that a more nuanced approach to the problems caused by excess sugar consumption – involving addressing inequality, regulatory changes, using ‘nudge’ interventions to change behaviour in less punitive ways, and so on – is needed.
The University should play a role in developing such a public policy alternative, rather than promoting the intellectually lazy response of taxes and bans as a panacea.