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Obesity and the sugar tax

The government's childhood obesity strategy was published on 18th August 2016, and the sugar tax is due to start in April 2018.

Childhood obesity in London

London has the highest rate of childhood obesity of any peer global city. In Reception (4 to 5 years), 23% of London children are overweight or obese compared to the English average of 22.2%.  However, by the time they reach Year 6 (age 10-11), more than one in three (37.4%) of London’s children are overweight or obese compared to the English average of 33.3%.

Tackling childhood obesity is a core principle of the Better Health for London: Next Steps report, signed up to by The Mayor of London, NHS England, Public Health England, London Councils and the 32 GP-led clinical commissioning groups. The report sets out the following shared goals:

  • Give all London's children a healthy, happy start to life – including achieving a 10% reduction in the proportion of children obese by Year 6 and reversing the trend in those who are overweight; and
  • Get London fitter with better food, more exercise and healthier living - including the aim of helping all Londoners to be active and eat healthily, with 70% of Londoners achieving recommended activity levels.

The Government is also looking at this issue, and is due to publish its Childhood Obesity Strategy in autumn 2016. 

The future costs of childhood obesity

Childhood obesity is a major challenge for outcomes and future service pressures for the UK and particularly for London. Obese children are more likely to be ill, to be absent from school due to illness, experience health-related limitations and require more medical care than normal weight children, with the consequent costs to the NHS and indirect costs to the economy such as parents taking time off work to care for them. 

Overweight and obese children are also more likely to become obese adults, and have a higher risk of morbidity, disability and premature mortality in adulthood, with the resulting greater costs on NHS and care budgets. Diabetes UK estimates that there are currently 3.8 million people living with diabetes in the UK and, by 2035/6, this is expected to increase to 6.25 million. Of those, more than 350,000 live in London and this figure is expected to rise by around 200,000 to over 500,000 by 2025. The current cost of direct patient care (including treatment, intervention and complications) for those living with diabetes in the UK is around £9.8 billion. The indirect costs associated with diabetes, including those related to increased death and illness, work loss and the need for informal care, are estimated at £13.9 billion.

How to prevent childhood obesity

There are no easy answers to what causes childhood obesity and no single ‘silver bullet’ to prevent it.   We know that a whole system approach is needed, taking on food choices, changing eating habits both at home and at school,  the need for more physical activity, food ingredients and manufacture, how food is retailed, advertising, and labelling.

The Foresight report was commissioned by the government as an extensive price of research into the causes of obesity. It found that people in the UK today, including children, don’t have less willpower and are not more gluttonous or lazier than previous generations. Nor is their biology significantly different to that of their forefathers. Society, however, and the food environment, has radically altered over the past five decades, with major changes in work patterns, transport, food production and food sales. This includes changes in environmental factors such as the increasing prevalence of fast food outlets,  and changes to physical activity patterns, including how children get to school, how physically active they are at weekends and the fact that families generally are less physically active so children are learning bad habits at home.

These changes have exposed an underlying biological tendency, possessed by many people, to both put on weight and retain it – as a consequence of exposure to a modern lifestyle. The food environment therefore must be addressed.

The childhood obesity strategy

The Government’s childhood obesity strategy was published on 18th August 2016 and can be found here.

The strategy is much less far-reaching than was originally hoped and London Councils has issued a statement saying how disappointed it is at the lack of support in the strategy for local government, to help combat childhood obesity. There are no measures included to ban advertising on unhealthy food and sugary drinks and no plans to reduce marketing of such products across other media such as social media and through sponsorship. There are also no controls proposed on retail price promotions of unhealthy food and drinks. The strategy states:

“We aim to significantly reduce England’s rate of childhood obesity within the next ten years. We are confident that our approach will reduce childhood obesity while respecting consumer choice, economic realities and, ultimately, our need to eat. Although we are clear in our goals and firm in the action we will take, the launch of this plan represents the start of a conversation, rather than the final word.”

The strategy does include:

  • The sugar tax – see below. There will be a consultation on the technical detail of the sugar tax over the summer, and legislation will be included in the Finance Bill 2017.
  • A voluntary scheme for manufacturers to reduce the amount of sugar in those food and drinks which children eat most. Manufacturers are encouraged to change recipes, reduce portion sizes or shift sales to lower sugar products, to reduce overall sugar across a range of products by at least 20% by 2020, including a 5% reduction in year one. To start with, the programme will concentrate on the nine categories that make the largest contributions to children’s sugar intakes: breakfast cereals, yoghurts, 5 biscuits, cakes, confectionery, morning goods (e.g. pastries), puddings, ice cream and sweet spreads.
  • PHE will monitor how successful this scheme is and whether manufacturers are making changes. Progress will be measured on the basis of reductions in the sales weighted average sugar content per 100 grams of food and drink, reductions in portion size so that these contain less sugar, or a clear sales shift towards lower sugar alternatives. PHE will publish reports on progress every 6 months.
  • Helping families recognise healthier choices, by updating the ‘nutrient profile’. This profile gives all manufactured food and drink a score based on how much sugar, fat, salt, fruit, vegetables and nuts, fibre and protein it contains. PHE will review the nutrient profile model to ensure it reflects the latest government dietary guidelines.
  • Working with local authorities to support them to tackle childhood obesity by encouraging them to adopt Government Buying Standards for Food and Catering Services (GBSF) standards, particularly in leisure centre vending machines.
  • A re-commitment to the Healthy Start scheme, which provides vouchers to families on a low income across England for milk, fresh and frozen fruit and vegetables, infant formula milk and free vitamins.
  • Encouraging schools to engage pupils in more physical exercise by including physical activity in the Ofsted healthy schools rating scheme. Schools will continue to spend the Primary PE and Sport Premium on specific interventions. PHE will be developing advice to schools for the academic year 2017/18 to show how they can work with school nurses, health centres, healthy weight teams in local authorities and other resources, to help children develop a healthier lifestyle. There are some other interventions to encourage school children to take more exercise.
  • The possibility of clearer labelling on food to show how much sugar it contains. This may depend on the timetable for the UK leaving the EU, as the UK may then change its laws on food labelling. 

The sugar tax

Public Health England produced its report on sugar reduction at the end of October 2015. It suggests that our daily intake of sugar should not exceed 5% of our total diet and recommends that adults and children cut back on the amount of sugar sweetened drinks they consume. PHE estimates that if we meet these recommendations, then within 10 years, we would not only improve an individual’s quality of life but could save the NHS something around £500m every year. 

The Sugar tax was announced in the 2016 Budget

So, from April 2018, there will be a unit-levy on producers and importers of water-based added sugar soft drinks. The levy is based on the total sugar content of the drinks. There will be two bands – one for sugar content above 5g per 100ml and a second higher band for sugar content above 8g per 100ml. Pure fruit juice and milk are excluded. The tax will be introduced in April 2018. There are no plans as yet to extend the tax to food items.

The tax is designed to encourage producers and importers to change their recipes to include less sugar. For drinks which continue to have sugar content in one of the two bands above, the Treasury estimates the tax will be at a rate of 18 pence in the lower band and 24 pence in the upper band, per litre unit charge. This price increase would be expected to be passed entirely onto consumers.

From September 2017, so giving a six-month lead-in time, any revenue raised from the levy between 2016/17 and 2020/21 can be used to:

  • help fund the primary school PE and sport premium to help schools support healthier, more active lifestyles. This funding will enable primary schools to make further improvements to the quality and breadth of PE and sport they offer, such as by introducing new activities and after school clubs and making greater use of people to coach sports
  • provide funding to give 25% of secondary schools increased opportunity to extend their school day to offer a wider range of activities for pupils, including more sport
  • provide funding to expand breakfast clubs in up to 1,600 schools starting from September 2017, to ensure more children have a nutritious breakfast as a healthy start to their school day.

It is expected therefore that between now and April 2018, producers and importers will save themselves money by changing their recipes to reduce the amount of added sugar in the drinks they sell, moving consumers towards lower sugar alternatives, and reducing portion sizes. The levy is expected to raise £520 million in the first year. The Office of Budget Responsibility expects that this number will fall over time as the total consumption of soft drinks in scope of the levy drops, in part as a result of producers changing their behaviour and helping consumers to make healthier choices.

Kathryn Gill, Policy Officer, London Councils

[email protected]