Mr. Steven Donaldson:

The KPMG report was commissioned by the three main tobacco players in Australia. To be clear - David Crow said this to me - we were looking for an independent body. The company currently works for the Australian Government, the Irish Government and the Department of Health. A person in my shoes has to decide how to evaluate what is a difficult problem to estimate. I decided to choose a legitimate global consultancy company to put in place the best methodology. In Europe, the methodology used to evaluate the illicit trade is endorsed by the European Anti-Fraud Office, OLAF. It is a reputable company and I am asking the committee members to consider its submission on these grounds and to invite the company in if necessary. That is what is going on in Australia.

What we see in Australia at the moment is that there is a major growth in illicit whites available here. This surprised us a little because we had expected there to be more growth in the counterfeit trade. Counterfeit product is growing but the trade in illicit whites is growing faster. These include brands like Manchester which, the report states, has gone from a 0.3% share before plain packaging came in to a 1.3% share and up as high as 3.8% in Sydney. These are being smuggled in by triads and biker gangs throughout the country. The largest ever seizures in Australia took place last October. We know for certain that the black market has been thriving since plain packaging has come in. That is why I raise it as a problem for Ireland because Ireland has the largest rate of non-Irish duty paid products in the country in all of western Europe. It is a serious problem and I believe it is undermining health objectives. My colleague might talk about the international context of smuggling as well.