Weight, Don’t Wait
Obesity is a significant public health issue faced by the South Australian government. The implications for the community, economy and the Government’s health budget demand a dramatic, decisive and urgent response. This paper proposes four policy alternatives:
- The Status quo includes a number of Government social marketing and direct action programs. They have not arrested the rise of obesity and more effective options should be considered.
- The Comprehensive Strategy Funded from General Revenue addresses market failure due to information asymmetry in the food market and passive government failure due to ineffective action.
- The Comprehensive Strategy Funded by a Calorie Tax introduces a Calorie Tax to the Comprehensive Strategy, to address negative externalities in the food market. The tax encourages consumers to make healthier food choices and the Government revenue funds the Comprehensive Strategy.
- The Calorie Trading Scheme uses market power to balance calorie consumption and expenditure. Manufacturers pay the social cost of calorie production as a tax, but can purchase offsets. Offsets are generated by any organized activity that verifiably expends calories.
The Calorie Trading Scheme is the most efficient alternative, but also faces complex challenges, including auditing and administration. If these cannot be resolved, the South Australian government should introduce the Comprehensive Strategy funded by a Calorie Tax.