Blog: The UK Government AKA Mythbusters
Olly Wehring | 23 March 2012
So you can see what we're up against, here's what the UK Government has offered in defence of its proposal to bring price intervention into play to combat alcohol misuse in the country.
I particularly like their counter-argument to the "This is illegal" 'myth.
MYTH: Proposals are going to hit consumers in the pocket during difficult times and punishes responsible drinkers.
FACT: 80% of alcohol purchases are made by 30% of the population, and this group are the main beneficiaries of discounted alcohol. The cost of a GBP0.40minimum unit price would be:
- for the average drinker = GBP21 to GBP23 a year
- for moderate drinkers (drinking within recommended limits of up to 21 units a week for men and 14 units for women) = GBP5 to GBP6 a year
- for harmful drinkers (drinking far above the recommended limit – more than 50 units a week for men and 35 for women) = GBP105 to GBP135 a year.
MYTH: This is just another duty increase
FACT: No it’s not, a duty increase hits all alcohol for everyone; a minimum unit price hits cheap, harmful alcohol. To get the same positive effect on consumption, health and crime as a GBP0.40 MUP, we would have had to raise duty by RPI+9%.
MYTH: This is another attack on the poor
FACT: People on low income are the least likely to drink alcohol at all - at the moment whenever a supermarket 'loss-leads' on alcohol, they are subsidizing heavy drinkers. Independent research by the IFS shows that cheap alcohol is bought by all income groups. The factor that most determines whether you are likely to buy really cheap alcohol is not your income, but how much you drink - the heaviest drinkers (and those who binge) are particularly likely to buy cheap alcohol, which is why we are targeting it.
MYTH: The Government is going to make money out of this – it’s just another tax
FACT: The Government will not make anything out of this. Unlike in Scotland, we are not planning to link this to a supermarket tax. Instead, we expect supermarkets to put any extra profits they make towards lowering the price of other goods. Studies have shown that deep discounting on alcohol benefits the heaviest drinkers, and costs the rest of us money - so ending the 'loss leaders' on alcohol, and instead discounting other products, will make the average shopping basket cheaper - which we think is the right thing in tough times.
MYTH: A minimum unit price of GBP0.40 won’t have that much of an impact on reducing crime and health-related issues.
FACT: There will be 170 fewer alcohol-related deaths in the first year, rising to 900 a year over ten years (7.7% fewer alcohol related deaths). There will be 50,600 fewer crimes a year; including 12,900 violent crimes. More than GBP80m will be saved in health and crime costs in the first year, rising to over GBP140m in the tenth year.
MYTH: This is another example of the Nanny State as you tell people what to drink and business what to charge.
FACT: People who drink sensibly will feel very little impact from these proposals. In particular, we want to support local pubs - where people drink sensibly and enjoy themselves - and reverse the shift towards 'pre-loading' on cheap alcohol at home - which we know leads to more violence. We are working in partnership with businesses: it is essential that we tackle price. We can't do that through voluntary agreements because it's illegal for the supermarkets to make agreements on pricing together. So to tackle cheap alcohol, Government has to take action.
MYTH: This is illegal.
FACT: It isn’t illegal. We believe coming down hard on cheap alcohol and its abuse is the right thing to do. International evidence shows that the price of alcohol is closely linked to how much is consumed, and we don’t believe we can tackle Britain's relationship with drink without doing something about excessively cheap alcohol. We make no excuses for clamping down on excessive drinking and drunken behaviour.
MYTH: Alcohol consumption is going down, why are you doing this?
FACT: Alcohol consumption in general might be going down, but binge-drinking isn’t – among women it has been rising. We know binge-drinking results in crime, anti-social behaviour and visits to A&E at a cost of GBP21bn a year. Around 50% of all alcohol consumed is drunk during binge sessions - this isn't a marginal problem.
MYTH: Banning multi-buy offers would mean no more good deals on booze
FACT: The Scots have had a ban on multi-buy offers since October 2011 and it doesn't mean you can't get good deals - a ban on multi-buys means that instead of '2 for 1' you offer 'half price'. This is actually better value for the customer because you can get the deal without buying two items. We don't want to stop people getting good deals - but we do want to stop shops 'pushing' people to buy more alcohol than they want.
In 2010 more than GBP42bn spent on alcohol in England and Wales alone. Alcohol has been so heavily discounted that it is now possible to buy a can of lager for a little as GBP0.18 and a two litre bottle of cider GBP1.69.
We estimate that in a community of 100,000 people, each year:
- 2,000 people will be admitted to hospital with an alcohol-related condition;
- 1,000 people will be a victim of alcohol-related crime;
- More than 3,000 will show some signs of alcohol dependence; and
- More than 13,000 people will binge drink.
In a recent study, 66% of 17 to 30 year-olds claimed to have ‘pre-loaded’ before a night out with pre-loaders two-and-a-half times more likely to be involved in violence than other drinkers.
Here's a round-up of the big stories on just-drinks last week, featuring AG Barr, Bombay Sapphire, Wines of South Africa and Pabst Brewing Co....
It seems there's not much in the world that can make people smile these days. Luckily, we're part of an industry that has just been scientifically proven to do just that. ...
Despite accounting for just a small percentage of overall sales, craft beer is making an impression on the US....
Here's a round-up of the big stories on just-drinks last week, featuring SABMiller, Orangina Schweppes, PepsiCo and Scottish devolution....
- No Home Comfort for TWE as Bids Collapse
- Treasury Wine Estates: Here I Go Again On My Own
- Bacardi Seeks Own History at Bombay Sapphire Home
- Will low-alcohol wines wither on the vine?
- Private-equity bids "over" - TWE head
- Carlsberg suspends production at Russian brewery
- Anheuser-Busch InBev appoints new AmBev CEO
- Treasury Wine Estates pulls plug on takeover talks
- Diageo's Johnnie Walker hit by Travel Retail slump
- Suntory Holdings to split beer, spirits division