The effectiveness of an increase in fuel excise taxation as a potential obesity prevention intervention

Can an increase in fuel excise taxation persuade people to use their cars less, and lose weight in the process? This was the question investigated by an article in BMC Public Health, which the authors talk about in this blog.

Obesity is a complex, ‘wicked’ problem now affecting billions of people around the world.  Obesity occurs when energy intake exceeds energy expenditure over time, leading to rising body mass index (BMI) and adiposity.  Recent estimates suggest that as many as 1.9 billion adults are now overweight or obese worldwide.  Statistics for children are also alarming, with 41 million children under the age of five years considered overweight or obese.  The global economic cost of obesity has been estimated at $2 trillion– a staggering amount.

There is growing recognition that interventions outside the health sector – that is, ‘upstream’ interventions – are required to improve obesogenic environments (that is environments that promote obesity).  Yet to date, limited evidence exists on the effectiveness and cost-effectiveness of these types of interventions for obesity prevention.

Information on the effectiveness of interventions is important because it allows us to select and fund the most pragmatic, useful interventions.  Information on which interventions represent the best value for money is also important, ensuring that we fund those interventions which make the best use of scarce resources and that are the most efficient at the societal level.

The National Health and Medical Research Council (NHMRC) funded Centre for Research Excellence (CRE) in Obesity Policy and Food Systems (grant no. 1041020) is a multi-organisational Australian research centre focused on research, capacity building and knowledge exchange on policy actions for creating healthy, sustainable, equitable food systems and reversing obesogenic environments.  A significant focus of the work of the CRE is to investigate the economic credentials of non-health sector policy interventions for obesity prevention.

No single intervention will halt or reverse the obesity epidemic.  Consideration of environmental and policy contexts is however an important aspect.  As environmental and policy change is often incremental, better information on which interventions provide the best ‘bang for buck’ is useful both in itself and in exploring the multi-faceted changes likely required to improve our dietary and physical activity environments.

Our work on fuel excise taxation is the first of the published CRE papers investigating the cost-effectiveness of non-health policy options for obesity prevention.  The transport sector was identified as a potentially important sector due to its ability to encourage incidental, regular physical activity across populations.

Our conservative modelling shows that an AUD0.10 increase per litre in the fuel excise tax could result in AUD2.6M in healthcare cost savings from reduction of the burden of obesity-related diseases.

Findings suggest that increasing fuel excise taxation may be a cost-effective obesity prevention intervention.  Significant obesity-related healthcare cost savings could be gained from a higher percentage of the Australian population commuting actively, rather than by private motor vehicle.  Our conservative modelling shows that an AUD0.10 increase per litre in the fuel excise tax could result in AUD2.6M in healthcare cost savings from reduction of the burden of obesity-related diseases.  Our ‘plausible case’ estimates suggest an even greater healthcare cost saving (AUD34.3M, 95% UI AUD17.4M-AUD51.3M).

Whilst increased fuel prices may encourage people to leave the car at home and engage in more walking, cycling and use of public transport, there are however some important caveats.  Transport networks that support and encourage active transport in Australia are lacking.  Many areas of Australian cities and towns are not connected to efficient, comprehensive public transport systems.  Policies and infrastructure to support safe walking and cycling are also lacking or lacklustre at best.  And many of the most socially disadvantaged groups are also those with the least accessibility to public and active transport – living on urban fringes with little choice but to rely on private vehicles to move around.

Whilst increasing the price of petrol may represent one policy lever that could be used to encourage more active transport, our research highlights the significant equity and acceptability impacts of such a policy.  In order to promote and encourage more active transport it is important that supportive policies and infrastructure are put into place, so that those who wish to switch from private motor vehicle travel to walking, cycling or using public transport are able to do so.

Fuel excise taxation is but one possible policy lever that could be used to encourage more walking, cycling and use of public transport.

Fuel excise taxation is but one possible policy lever that could be used to encourage more walking, cycling and use of public transport.  The CRE is exploring other policy options that might encourage active transport, including improvements to safety and the perception of safety of active modes and infrastructure to better support walking and cycling.

The CRE is also investigating a variety of other non-health sector policy options that might have population level impacts on obesity.  Sugar-sweetened beverage taxes are being explored, with an analysis of impacts across socioeconomic groups.  The cost-effectiveness of community-based obesity prevention interventions are also being examined, along with policy options around the restriction of TV advertising of discretionary foods to Australian children.

The resultant body of work will provide tangible, useful information for decision-makers on the potential obesity-related costs and health impacts of a wide variety of policy-relevant interventions.

 

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