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VERBAND DER CIGARETTEI~INDUSTRIE Oct 9th, 1981 CONFIDENTIAL PR-STATUS REPORT 1981 SMOKING ISSUES IN GE~kNY A. General Overview 1980 had been a year of intensified antl-smoking activities mainly because of WHOIs devoting that year's World Health Day to the smoking and health issue. But in contrast to former times most of these activities were rather moderate intone and presentation. In this year smoking topics have in general not been too prominent in the public discussion. This was due to the fact that there was no such media event llke the WHO day of last year and that there were other public topics of much greater political weight and priority, i. e. the status of the derman economy or the still lasting controversy about Germany's defence policy. Whenever smoking issues came up in the public they concentrated on other aspects than medical ones with the sole exception of the passive smoking controversy caused by Dr. HIRAYAMA's publication. Yet the main smoking issue in 1981 has been so far the coming tobacco tax and price increases in 1982. B. Highlights 1. Government Activities a) Tobacco Tax and Price Increases Much public uproar caused the announcement of major tobacco tax increases by the Government - 2- T105390258

- 2- to be enforced in June 1982. According to her plans the overall tax increase for manufactured cigarettes will be around 39 %, thus rising the price per pack (20 cigarettes) of the most p'opular brands from DM 2,85 to DM 4,00. This will probably result in a 15 to 18 % drop of sales. The overall tax increase for fine-cut tobacco was even much higher (+ 150 %), though for the consumer the absolute price difference between manufactured cigarettes and roll your owns will become even bigger than it is now. Minor tax increases are also foreseen for pipe-tobacco and snuff with cigars being totally exempt. 0nly the minimum tax rate for cigarillos has been slightly increased. From an industry point of view there are two remarkable aspects in this tobacco tax increase. First, it is explicitly stated that the German Government sticks to the cigarette tax structure ~ith its 40 % specific element as it is now. And second, for the first time the German Government motivates the tax increase not only with fiscal necessity but with health reasons as well. This fits well to a statement by the German Minister of Finance. When asked whether this huge price step would result in a loss of sales volume and thus in a loss of tax revenues he answered that this would be compensated by savings in health care costs. b) Health Warning On 1st October th~ last step of the voluntary agreement of the cigarette industry concerning the health warning in advertising and on pac~s went into force. This gave stimulus to an ephemeral public echo in the media. Since neither the cigar -3- Ti05390259

-3- industry nor the smoking tobacco industry could agree to a similar voluntary agreement, the Health Ministry now works~on a Ministerial Ordinance which will legally enforce the health warning on all tobacco products. The regulations of the cigarette industry will be included. 2. Parliamentar~ Actions There have been no actions against smoking so far. 3. Anti,_S.m.oki~n~ Gro..ups a) Medical Working Group Smoking and Health (~rztlicher Arbeitskreis Rauchen und Gesundheit) One of the most active anti-smoking groups in Germany is the so-called "Medical Working Group Smoking and Health" with its Chairman Prof. SCHMIDT. Industry's strategy has always been to minimize its opinion making influence and to isolate it from the scientific and political community. •One big advantage which this group has is the attribute "Medical" in its organization's name. In the eyes of the public "Medical" stands for competence and high credibility. Fact is, however, that the members of this group are mostly of none- medical professions. Therefore, our ally, the German Tobacco Growers' Association, filed suit against them on the legal ground of misleading the public by its organization's name. The Association won in the first round which has been commented on in the press. The antl-smokers went to the next court which w ll ud6e without further appeal. T105390260

-4- b) Non-Smokers Activists, ~nlch (NIM) Besides the so-called "Medical Working Group Smoking and Health" there are a lot of non-smokers organ- izations on community level, loosely coordinated by the"Medical Group".One of the most active in the field of publicity is the NIM of Munich. In a law suit against a cigarette manufacturer in Muiich, it tries to get evidence from court on the legality of their antl-smoking campaign which is directed against the advertisinG for one of the company's brands. Their intention is to get public support for a complete ban of all forms of cigarette advertising and promotion. Medical News a) HIRAYAF~'s Reception in Germany The over~helming media event in this field of smoking issues was the reception of Dr. HIRAYAMA's study on passive smoking. Due to the fact that the German press contrary to the press abroad was rather reluctant in publishing the news,industry had time enough to prepare counter measures. When HIRAYAMA got his first report in a leading medical journal (MMW) Prof. SCHIEVELBEIN of the Munich Heart Center at once commented on his methodological mistakes and other shortcomings in the same journal, thus throwing doubts on the validity of his conclusions. The same happened when the HIRAY~A-story hit the dailles,the critic being this time Prof. SC~L of the German Cancer Research Center in Heidelberg. The real blow came from a very nasty article ~n ~h~ "stern", which is Germany's biggest selling weekly with a circulation of ~.7 million. In short, lt claimed -5 - T!05390261

that Dr. HIRAYAMAhad proved that passive smoking causes lung cancer, leaving out the criticism of SCHIEVELBEIN and SCHM~HL. The Verband then decided to counteract with an advertisement in four leading dailies under the headline "~at You Could not Read in 'stern' " charging the "stern" of having been biassed in its report. The reaction was two-fold: First, our campaign gained us more public under- standing of our position. Second, it provoked a charge against industry of misinforming the public to be dealt with by the German Press Council~ This charge was initiated by the "Medical Working Group". It was recently rejected by the Press Council as being unfounded. b) GARFINKEL's "Counterblast" When the GARFINKEL study on passive smoking was publishe~ in the United States the German industry profited of a quick international information exchange. Before the news spread from the United States to the Continent we were able to furnish our national press agency in advance with first-hand information. This gave a wide publicity to the GARFINKEL study in the German media thus counterbalancing the HIRAYAMA results. c) Too Much to be Credible Lastly, MMWtook up the issue of passive smoking and published in its latest edition (No. 40/2.10.1981) interviews with HIRAYAMA and GARFINKEL and a critical evaluation of the latest scientific state of the passive smoking issue ~y the German Prof. LEHNERT former Chairman of the German Society of Occupational Medicine. In his interview HIRAYAMA obviously overstated -6- T105390262

-6- his case by telling that the non-smoking Japanese wives of smokers are significantly more prone to commit suicide than those of non-smokers because of passive smoking. Furthermore he admitted that all his results concerning the alleged effects of passive smoking were only hypotheses. Prof. LEHh~RT in his final evaluation comes to the conclusion that after all there is still "no scientifically convincing proof that the risk of lung cancer is increased by so-called passive smoking". This news ~ill be spread to the German media. C. ~Industrv Action ~ I. P2~sic PR Ap_proach Public Relations in Germany basically intends to maintain the cigarette industry a maximum of freedom in its marketing activities and to ensure the consumer.the freedom of choice whether to smoke or not. Having regard to these basic intentions there are four main goals: Promotion of new objective scientific findings concerning smoking and health Creating a positive image of the industry Defence of smoking as a socially accepted habit Encouraging the smoker To reach these goals the mass media and good contacts to journalists play a key role. The Verband has in 1981 intensified its relations to the press and other media. Furthermore it has strenghten6d its ability to create. "good news" by credible third parties as a counterbalance to the continuous flow of bad ones, m~ny of which come from abroad. -7- T105390263

-7- Another key role is held by the scientific and political community. Besides good relations on an individual basis much public credit ha~ been given to the industry by its engagement in the work of the independent "Research Council Smoking and Health". It documents industry's serious and responsible intention to cope with the medical challenge of smoking and health. It made industry not a beloved but at least a respected partner to serious scientists and health officials. 2. Mobilizing Industry Employees a) Information and Education Industry employees and their families are key persons who have to be on the PR forefront because of their known and vested interest in this industry. Motivation needs information and education first. Therefore, the Verband jointly with the Tobacco Workers' Union holds regular Smoking and health lessons where employees of the different member companies are taught the basic issue~ and how to defend industry's positions. Additionally, member companies~of the Verband are leading intensive training courses for their employees. b) Tobacco Action Network Ultimate goal of these educational efforts is to win activists from within the industry to stand up and respond to attacks against the industry or its products. Today the Verband disposes of a net- work of more than 200 employees all over the Federal Republic. They keep us informed about their local media scenery and they write letters to the editor, if necessary. It is planned to organize and structure this PR force in a way -8- T105390264

- 8 - comparable to the American Tobacco Instltute's TAN wlth similar tasks and responsibilities. 3. Mobilizing the Tobacco Family The tobacco family comprises the tobacco growers as well as the tobacco trade. They, too, have a vested interest in the ~ell-being of the tobacco business. As has already been sho~m in the case of the tobacco growers' law suit against the "Medical Working Group" there is a close cooperation between industry and this branch of the business. The trade, however, is rather reluctant to engage itself in overall PR matters. Yet, with its 8.000 outlets all over the country it might be a valuable and powerful PR force. The reluctance is due partly because the trade has not yet fully realized the importance of the smoking and health question for its future business and partly because the trade always expects to be remunerated for every- thing outside his own selling activities. In cooperation with the respective trade associations the Verband tries to build up a sense of common interest and engagement on behalf of the trade. This is done by the Verband~S participation in training seminars of the trade as well as by including the trade into the flow of industry communication concerning matters of smoking and health (e. g. the booklet "The Different Aspects of Smoking", edited by the Verband). Mobilizing Allies Besides these industriem which are economically connected with the tobacco industry one natural and strong ally at least in the defence ef advertising is the advertising business and its associations. There are good relations between the German Advertising Federation (ZAW) and the Verband, the result of which has been the edition of the 2AW-study on the effects of cigarette advertising in this T105390265

-9- year. It got a wide distrlbutlon,natlonal and inter- natlonal,and grew favourable press comments. 5. Publications Medical prevention is praised to be the right cure to rising health care costs with medical doctors and health educators trying to regulate the individual life style. They use the threat of sickness and premature death if one does not stick to their therapy of mineral waters, non-saturated fats, no clgare~tes, and jogging some miles a day. This is repeated everywhere, whether it is scientifically founded or not, and makes normal life rather a plague than a pleasure and creates feelings of guilt within the smoker. It is against this prevention hysteria that the German medical journalist WERNER THIE~SHIRN published a book with the title "Life without fear. The informed patient". There he criticizes out- dated dogmas of the conventional preventive wisdom and defends a life of pleasure. Since this book is brand- new on the market sales promotions are just beginning. 6. PR Control To ensure maximum effiency PR measures need to be controlled. In a market research the Verband evaluated the PR effect of photos depicting smoking prominent persons. The results were that the smokers,having seen these photos,felt themselves confirmed in their habit whereas non-smokers tended to be more tolerant towards smoking. In another soclo- psychological research study concerning "Cigarette Smoking and Society",which was a repetition of the same survey in 1978, the Verband learned how industry's PR measures had helped to shape public opinion on smoking issues. - 10- Ti05390266

-10- a°) There has been no further increase in the percentage of people who believe that smoking is harmful. However, more people learned about passive smoking. b) Smoking is no longer felt to be of top priority in the public discussion. c) There has been a dramatic reduction in the percentage of people from 48 % to 11% who once favoured smoking bans. They felt that arrangements on the basis of mutual tolerance would be the better way. d) Similarily the percentage of those who believed that the smokers/.non-smokers relations in the future would be governed by legislative regulations dropped from 56 % to 40 %. D. Outlook It is difficult to give a reliable prognosis in such a sensible field like smoking and health. It is very likely that topics of more political or economic importance will govern the public debate especially with the prospect of cigarette prices going up in mid 1982. Yet, there might come some pressure from health officials concerning cigarette advertising. But more PR impact is to be expected by spill-over effects from events out~-._ side Germany. T105390267