Bottom prices up as Coalition plans bargain booze ban

The Coalition is finally making good on its plans to ban cheap booze. But so far, no-one is impressed.

by Emma Haslett
Last Updated: 06 Nov 2012
Almost nine months after the idea was first mentioned, the Coalition will finally set out plans for minimum pricing on booze today. The new rules will mean that retailers can no longer sell alcohol at what the Government calls ‘below-cost’, which the defined as the tax drinkers pay on booze, or duty plus VAT. (So a misleading definition, because the retailer could still lose money on other costs, such as production). The plans are firmly targeted at supermarkets, which pulls punters in with cheap alcohol as a loss-leader – but, after criticism from the health lobby and pub groups alike, the measures don’t seem to be worthy of a raised glass from either side of the argument.

With research by Sheffield University showing that raising the price of alcohol to a minimum of 50p per unit would mean that after 10 years, there would be almost 3,000 fewer alcohol-related deaths each year, and 41,000 fewer cases of chronic illness, the idea seems reasonably sound. But the Coalition has opted for a more business-friendly minimum price of 21p per unit of beer, and 28p per unit of spirits – which means a can of weak 'throwing' lager could be sold for 38p, while a bottle of spirits could be sold for less than £8, and a bottle of wine could still be priced at just over £2.

One thing that both the health lobby and businesses can agree on is that those prices are far lower than the average punter would expect to pay anyway. So even with the new minimum in place, consumers aren’t exactly going to be penny-pinching come Saturday night. It’s a fact Professor Ian Gilmore, chair of the Alcohol Health Alliance UK, was emphatic about on this morning’s Today programme. ‘To bring in a measure that we know in practice will have no effect at all on the health of this nation I think is disappointing,’ he said.

And businesses are no more impressed: Diageo managed to stir itself to issue a half-hearted statement suggesting the Government focus more on ‘raising awareness of the dangers of alcohol misuse’ instead of creating more red tape, while Asda said it had introduced a minimum pricing policy six months ago anyway. Pubs, on the other hand, voiced their disappointment at the leniency of the measures, with groups such as the Campaign for Real Ale pointing out that such a low minimum price ‘means pubs will continue to close as they are undercut by supermarkets selling cans of beer at pocket-money prices’.

So in its quest to please both sides of the lobby, it looks like the Coalition has made few friends so far. But there’s a definite chance that this could be a cunning ploy to establish the principle of a unit price for alcohol without alienating the industry, before gradually upping that minimum price – in which case it’s only a matter of time before the Government chooses a side. Watch this space…

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