Tuesday, 18 January 2011

Ban on the sale of cheap alcohol

The Telegraph reports,

The Coalition Government pledged to combat cheap drink promotions and end the selling of alcohol at below cost.

Under plans to be unveiled by the Home Office today retailers will be banned from selling drinks for less than the value of duty and VAT owed on them.

It will, for the first time, effectively set an individual minimum value for each product under which the price cannot drop.

They quoted Tory MP Andrew Griffiths, who thought the measures did not go far enough:

“The reality is this matter is well intentioned but it will not stop supermarkets using alcohol as a loss leader and it certainly will not help pubs and small shop owners.”

BBC Breakfast featured the same story, and there's a corresponding article on the BBC News website:

The British Medical Association said the proposals did not go far enough.

"It's not minimum pricing, it's not really going to make that much difference," said a spokeswoman.

"What we're calling for is tough action."

Don Shenker, chief executive of Alcohol Concern, said: "Duty is so low in the UK that it will still be possible to sell very cheap alcohol and be within the law.

"The government needs to look again at a minimum price per unit of alcohol. That is the only evidence-based approach that will end cheap discounts once and for all."

It is amusing that the march of the British nanny state has been restrained by EU anti-competition laws, but it's nevertheless disturbing that the Coalition are determined to nudge us as far as the law will allow.

In the Telegraph article, the only opposition to the proposals came from those who wanted stronger measures. The vested interests lent their support to the moral crusaders:

Jonathan Mail, head of public affairs at Camra, said: “We think the decision is a betrayal of the Government’s promise to ban below cost alcohol sales. It will allow supermarkets to continue to sell alcohol below cost unhindered.”

Brigid Simmonds, chief executive of the British Beer & Pub Association, said: “This is a clear measure that can be implemented quickly and will stamp out the worst cases of below-cost selling. However, it will not have a significant impact on low-priced alcohol in supermarkets.

“With 70 per cent of alcohol now sold in the off-trade, there is a real need for the Government to do more to support the pub.”

Classic. Meanwhile, ASDA joined Tesco in supporting minimum pricing:
A spokesman for Asda, which has already introduced such a policy, added: “Six months ago we announced that we wouldn’t sell alcohol below the cost of duty plus VAT. We also called on the Government to establish a floor price below which it would be illegal to sell alcohol and hoped that they would follow our lead.”
I was surprised that the story didn't feature on the front page of The Guardian, but it seems they reported on the issue yesterday:

Ministers are expected to announce tomorrow that they have decided to restrict a ban on cut-price sales of alcohol, enabling supermarkets to continue selling beer at 38p a can and wine at just over £2 a bottle.

The move, which will keep the ban to those drink sales below the rate of duty and VAT, has triggered claims from publicans and health campaigners that alcohol will still be available at "pocket-money prices".


The former chief medical officer, Sir Liam Donaldson, has argued for stronger action including a minimum unit price of 50p, saying it could save 3,400 lives a year.

This approach, which has been endorsed by Nice, the official public health watchdog, would put the minimum price of a pint of beer closer to £1-£1.50.

None of the articles quoted anyone prepared to state the obvious: the government has no right to distort alcohol prices. The free market should determine what we pay, and individuals should be free to choose what they do with their own money and their own bodies. Nudging is not a legitimate aim for the government. Grown-ups need to decide things for themselves.

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