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) reports on estimated amounts 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 for each category of expenditure for each quarter back to 1960 is available electronically.2 Note that ABS estimates of final private consumption of tobacco products until 2014 were based not on sales data but rather just on excise and manufacturing figures adjusted for imports, exports and changes in inventory.3 The data 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, and are adjusted for seasonal trends. Since 2014, estimates of tobacco prices take into account not just survey data but also prices from transactions (sales) figures provided by a number of large retailers from grocery scanner machines.4 Volume estimates used in construction of national accounts in recent years also take into account scanner data from large grocery retailers.5
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 2022. Total private final household consumption of cigarettes and tobacco is shown in current dollars, and then in chain volumes (seasonally adjusted) to account for production volumes and previous year prices.[i] Finally, to provide an estimate of trends in the quantity smoked per person (rather than just the increasing total expenditure resulting from increasing prices of cigarettes and the growing population), the final column adjusts these chain volume figures by total population size, providing a per capita estimate of cigarette and tobacco consumption adjusting for price, volume, and population size over time.
As can be seen from Table 2.4.1, total estimated household spending on tobacco products over the more than 60 years until December 2022 has increased more than 50-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 (that is, using chain volumes), Australians in 2022 were spending 70% less on tobacco than they were at 1960, and 70% less than at the peak of consumption in 1975. It also must be remembered that the Australian population increased substantially over that period, from about 10 million in 1960 to almost 26 million in 2022. Adjusting for population size, private final household consumption figures show that Australians were consuming 88% less tobacco products per capita in 2022 than they were consuming at the height of (per capita) consumption in 1970. Per capita consumption, based on seasonally adjusted price-adjusted private final consumption, more than halved from 2012 to 2022, and showed yearly declines of 9-14% from 2019 onwards.
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.6
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 2.4.2 are averages across all household types. Figure 2.4.2 shows weekly household expenditure on tobacco products adjusted to take into account increases in tobacco prices over the same period.
Average household expenditure on tobacco products more than doubled in the 30 years from 1984. However when the substantial increases in tobacco prices over that period are taken into account, it would seem that households in 2015–16 purchased on average just over one-eighth of the quantity of tobacco products they were purchasing in 1984.
[i] For more information, see: http://www.abs.gov.au/AUSSTATS/abs@.nsf/3d68c56307742d8fca257090002029cd/95ce2d6796bd15aeca256db800754639/$FILE/ATT4T7WF/Demystifying%20Chain%20Volume%20Measures_1.pdf
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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 Expenditure (HFCE). Canberra, Australia 2020. Last update: 28/05/2020; Viewed 29/06/2020. Available from: https://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/5206.0Main+Features1Mar%202020?OpenDocument
3. Australian Bureau of Statistics. 5216.0 Australian National Accounts: concepts, sources and methods, 2015. Canberra: ABS, 2015. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/ProductsbyCatalogue/8AC0D9921051E17BCA2570B300807D36?OpenDocument.
4. Australian Bureau of Statistics. 6401.0 - Feature article: the use of transactions data to compile the Consumer Price Index. Canberra: ABS, 2013. Available from: https://www.abs.gov.au/ausstats/abs@.nsf/Previousproducts/6401.0Main%20Features2Sep%202013?opendocument&tabname=Summary&prodno=6401.0&issue=Sep%202013&num=&view=.
5. Australian Bureau of Statistics. Recent applications of supermarket scanner data in the National Accounts. Canberra, Australia 2021. Last update: 16/06/2021; Viewed 30/06/2021. Available from: https://www.abs.gov.au/statistics/research/recent-applications-supermarket-scanner-data-national-accounts.
6. Australian Bureau of Statistics. 6503.0 - Household Expenditure Survey and Survey of Income and Housing, User Guide, Australia, 2015-16 Canberra, Australia 2017. Last update: Viewed 30/04/2019. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/6503.0Main+Features100002015-16?OpenDocument.
7. Australian Bureau of Statistics. 6530.0 - Household Expenditure Survey, Australia: Summary of Results, 2015-16: 1 Household Expenditure, 1984 to 2015-16 Canberra, Australia 2017. Last update: Viewed 30/04/2019. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6530.02015-16?OpenDocument.
8. Australian Bureau of Statistics. 6401.0 Consumer Price Index, Australia, Table 7, CPI: Group, Sub-group and Expenditure Class, Weighted Average of Eight Capital Cities. Canberra: ABS, 2017. Last update: Viewed 19 September 2017. Available from: http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/938DA570A34A8EDACA2568A900139350?opendocument.