Smoking in New South WalesPubs and Clubs

Nick “ Social ” WalfordMichael “ Healthy ” RudlandSteven “ Quit ” Hargreaves

Anthony “ Smokin’ ” Benscher

Loss of revenue and profits to NSW PHC

Loss of consumer surplus to smokers who frequent NSW PHC

Foregone Treatment Costs

• Hospital

• Medical

• Nursing home

• Pharmaceutical

Foregone Production Costs

• Paid Workforce• Reduction in workforce• Absenteeism• On-the-job productivity

• Household• Sickness• Premature death

Increased Utility from Quality of Life

• Employment and patronage

of NSW PHC

• Fewer passive smoking-

related deaths

Reduced Fire Costs

• Property damage• Fire services

Reduced Legal Costs due to Fewer ETS-related claims

Costs of proposed ban Benefits of proposed ban

Calculation of Benefit-Cost Ratio

Recommendation regarding proposed

smoking ban in all NSW PHC

METHODOLOGY BENEFITSCOSTS

Social Health Costs ofPassive Smoking

• Medical, Hospital, Nursing Home, Pharmaceutical

• Don’t double count private provision: out of pocket expenses, private insurance, Medicare rebates

• Most direct damage from passive smoking is due to co-habitation with a smoker

Health Costs of Passive Smoking

Hospital Medical Nursing Homes Pharmaceuticals TOTAL

$2.5 million $10.5 million $1.9 million $9.8 million $24.7 million

Social Health Costs of Passive Smoking in Australia

Year One Year Two Year Three Year Four Year Five Year Six

0 $575,000 $1.15 million $1.725 million $2.3 million $0

Social Health Costs of Passive Smoking in NSW Pubs and Clubs

How much would you pay to have a smoke-free pub?

Non-Smokers

• Smoke-free pub or club worth $2.05 / visit– $208m in a year

• Bar Staff: shifts many times longer so value many times patrons’– $34m in a year

Smokers

Smokers

• Smoking in NSW pubs and clubs worth $5 / visit–$239.15m in a year

Loss of revenue and profits to NSW PHC

Loss of consumer surplus to smokers who frequent NSW PHC

Foregone Treatment Costs

• Hospital

• Medical

• Nursing home

• Pharmaceutical

Foregone Production Costs

• Paid Workforce• Reduction in workforce• Absenteeism• On-the-job productivity

• Household• Sickness• Premature death

Increased Utility from Quality of Life

• Employment and patronage

of NSW PHC

• Fewer passive smoking-

related deaths

Reduced Fire Costs

• Property damage• Fire services

Reduced Legal Costs due to Fewer ETS-related claims

Costs of proposed ban Benefits of proposed ban

Calculation of Benefit-Cost Ratio

Recommendation regarding proposed

smoking ban in all NSW PHC

METHODOLOGY BENEFITSCOSTS

$2.392b $2.713b

1.134NPV = $377m

YO!!