2.4 Expenditure on tobacco products

Another way of estimating tobacco consumption is to quantify spending by consumers on tobacco products.

2.4.1 Private final consumption

The Australian Bureau of Statistics (ABS) publishes quarterly reports of the amount spent by consumers on various products and services as part of a major quarterly report quantifying Australia's gross national product.1 Its private final household consumption data include estimates of household spending on a range of goods and services; data for each category of expenditure for each quarter back to 1971 is available electronically.2

Table 2.4.1 and Figure 2.4.1 show ABS estimates of total amounts Australians spent on cigarettes and other tobacco products between 1960 and 2011. To provide an estimate of trends in the quantity smoked per person (rather than just changing prices of cigarettes and the growing population), the second column adjusts these figures to take into account changes in the average price of tobacco products before and since 2005, and also divides them by the number of people 15 years and over.

Table 2.4.1
Private final consumption on tobacco products–in current dollars, at constant (2009–10) prices, and per capita at constant prices: Australia, 1959–60 to 2010–11

Year ending June

Current $ million

Current (trend) $ million

Chain volume* (original) $ million

Chain volume* (trend) $ million

Chain trend per capita, $†

1960

354

359

15 567

15 600

2172

1961

371

371

16 210

16 215

2212

1962

378

377

16 439

16 393

2190

1963

388

388

16 979

17 029

2228

1964

400

401

17 436

17 413

2231

1965

437

436

17 635

17 675

2215

1966

477

475

17 645

17 674

2161

1967

495

495

18 149

18 112

2171

1968

528

521

18 613

18 552

2177

1969

546

547

19 357

19 382

2224

1970

569

570

19 798

19 834

2228

1971

620

626

20 102

20 150

2162

1972

675

675

20 274

20 227

2127

1973

744

742

20 425

20 432

2108

1974

834

833

20 689

20 679

2089

1975

991

981

21 281

21 237

2108

1976

1204

1204

21 422

21 389

2088

1977

1318

1315

21 720

21 711

2082

1978

1336

1343

21 508

21 587

2033

1979

1514

1513

21 353

21 288

1972

1980

1644

1643

20 883

20 918

1904

1981

1765

1768

21 374

21 405

1912

1982

1943

1945

22 059

22 012

1924

1983

2108

2114

20 442

20 532

1764

1984

2452

2447

19 600

19 566

1652

1985

2674

2673

19 403

19 348

1604

1986

2950

2955

19 163

19 193

1558

1987

3303

3303

19 164

19 167

1524

1988

3545

3544

19 080

19 070

1486

1989

3862

3867

19 047

19 049

1455

1990

4358

4355

19 040

19 027

1430

1991

4730

4742

18 452

18 465

1368

1992

4822

4818

17 248

17 263

1262

1993

5411

5417

16 135

16 132

1166

1994

5690

5683

14 903

14 904

1065

1995

5777

5779

13 968

13 955

984

1996

6293

6285

13 068

13 060

907

1997

6680

6674

13 342

13 344

915

1998

6878

6885

13 342

13 351

904

1999

7318

7316

13 678

13 687

914

2000

7769

7761

13 607

13 514

890

2001

8616

8613

13 258

13 333

864

2002

9033

9049

12 921

12 943

827

2003

9492

9466

12 943

12 907

812

2004

9634

9657

12 715

12 736

790

2005

10 262

10 270

13 046

13 067

798

2006

10 340

10 328

12 633

12 611

758

2007

10 520

10 534

12 155

12 166

716

2008

10 880

10 868

12 024

12 014

692

2009

10 972

10 768

11 595

11 598

653

2010

11 409

11 427

11 407

11 387

630

2011

13 479

13 463

11 261

11 279

614

Source: ABS 20112 and 20104

* Historical chain volume estimates of consumption are frequently revised to take account of changes in relative prices. Readers are advised to refer to latest available data in the source document.

† Per Australians aged 15 years and over

 

Figure 2.4.1

Figure 2.4.1
Final private expenditure on tobacco products, per capita at constant prices, Australia: 1959–60 to 2009–10 ($2009–10)

Source: ABS Private Final Consumption data, Australian National Accounts2 and 20104

Note that ABS estimates of final private consumption of tobacco products are based not on sales data but rather on excise and manufacturing figures adjusted for imports, exports and changes in inventory.3 They also take into account the estimated impact of increases in duty on the retail price of cigarettes, using the tobacco component of the Consumer Price Index.

As can be seen from Table 2.4.1, total spending on tobacco products over the 50 years until June 2011 has increased almost 40-fold. However it must be remembered that the price of tobacco products has increased significantly over that period, well beyond increases in the Consumer Price Index. Taking into account price increases in tobacco products, Australians in 2010 were consuming 50% less than what they were spending on tobacco products at the peak of consumption in the early 1977. It also must be remembered that the population increased substantially over that period, from about 7 million adults in 1960 to more than 18 million in 2010. Based on private final consumption figures it is estimated that by 2010, Australians were consuming 70% less tobacco products per capita than they were consuming at the height of consumption in 1976.

2.4.2 Household expenditure

An alternative estimate of trends in tobacco consumption is provided by average household spending on tobacco products as reported in the ABS's (approximately) six-yearly surveys of household expenditure.5

The ABS estimates of household expenditure are compiled from diaries of spending by all members of the household but are calculated for the household as a whole, regardless of numbers and employment status of people in the household. The data included in Table 2.4.26 are averages across all household types. Figure 2.4.2 shows the same information, adjusted to take into account increases in tobacco prices over the same period.

Table 2.4.2
Reported weekly expenditure on cigarettes and other tobacco products, average all households, Australia, 1984 to 2009–10 ($ current), and adjusted to current tobacco prices

Year

Average weekly household expenditure

Spending as a % of total weekly expenditure

Average weekly household expenditure adjusted for tobacco prices

1984

$5.73

1.6%

$59.98

1988–89

$6.89

1.4%

$38.55

1993–94

$9.19

1.5%

$26.67

1998–99

$10.74

1.5%

$21.38

2003–04

$11.55

1.3%

$15.31

2009–10

$12.57

1.0%

$12.57

Change since 1984

+120%

–40%

–80%

Sources: ABS 20116, Table 1 Household expenditure

 

Figure 2.4.2

Figure 2.4.2
Reported weekly expenditure on cigarettes and other tobacco products, average all households, Australia 1984 to 2009–10 adjusted to average tobacco prices in 2009–10

Sources: ABS 20116 and 20117

Notes: Refer ABS 2011 Table 16 and ABS 2011 Cigarettes and tobacco sub-index7

Average household expenditure more than doubled in the 25 years from 1984. However when the substantial increases in tobacco prices over that period are taken into account, it would seem that households in 2009–10 are purchasing on average just over one-fifth of the quantity of tobacco products they were purchasing in 1984.

Table 2.4.3 sets out average expenditure as reported in the ABSs Household Expenditure Survey for households with various levels of income.

Table 2.4.3
Average weekly expenditure on tobacco products among households in each income quintile, Australia 2009–10: dollars current, and as percentage of total household income

 

Raw quintiles

Quintile adjusted for household number

Expenditure as a % of 'equivalised' household income

Lowest income quintile*

$8.03

$10.62

1.6%

Second income quintile

$12.18

$13.38

1.4%

Third income quintile

$15.22

$14.34

1.2%

Fourth income quintile

$15.58

$15.46

1.0%

Highest income quintile

$11.83

$10.02

0.5%

Source: ABS 20116 (refer Tables 3 and 5)

* Includes a high proportion of households comprising older single people on pensions, with a higher proportion of females than males

While households with lower-than-average income tend to spend (on average) about the same amounts on tobacco products as higher income households, average spending on tobacco products as a percentage of total weekly expenditure is higher among low income households.8 Patterns of personal expenditure among different socio-economic groups are explored in more detail in Chapter 9, Section 9.4.

Recent news and research

For recent news items and research on this topic, click here. (Last updated October 2016) 

References

1. Australian Bureau of Statistics. 5204.0 Australian System of National Accounts 2010-11. Canberra: ABS, 2011. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/ProductsbyCatalogue/110953FFA28D4E52CA2572110002FF03?OpenDocument

2. Australian Bureau of Statistics. 5206.0 Australian National Accounts: national income, expenditure and product, Table 8. Household final consumption (HFCE) Australia. Canberra: ABS, 2011. Updated 7 December 2011 [viewed 10 December 2011] ; Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5206.0Sep%202011?OpenDocument

3. Australian Bureau of Statistics. 5216.0 Australian National Accounts: concepts, sources and methods, 2000. Canberra: ABS, 2000. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/ProductsbyCatalogue/8AC0D9921051E17BCA2570B300807D36?OpenDocument

4. Australian Bureau of Statistics. 3201.0 Population by age and sex, Australian states and territories, Jun 2010; Table 9. Estimated resident population by single year of age, Australia Canberra: ABS, 2010. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/B52C3903D894336DCA2568A9001393C1?opendocument

5. Australian Bureau of Statistics. 6503.0 Household Expenditure Survey and Survey of Income and Housing: User Guide, 2003-04. Canberra: ABS, 2006. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/Latestproducts/4545461BB7FEB73CCA25718C001AB99C?opendocument

6. Australian Bureau of Statistics. 6503.0 Household Expenditure Survey and Survey of Income and Housing: summary of results, 2009-10. Canberra: ABS, 2011. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6530.02009-10?OpenDocument

7. Australian Bureau of Statistics. 6401.0 Consumer Price Index, Australia Table 11. CPI: group, sub-group and expenditure class, index numbers by capital city. Canberra: ABS, 2011. Updated 26 October 2011 [viewed 30 December 2011] ; Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6401.0Sep%202011?OpenDocument

8. Siahpush M, Borland R and Scollo M. Smoking and financial stress. Tobacco Control 2003;12:60-6. Available from: http://tobaccocontrol.bmj.com/cgi/content/full/12/1/60

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