Minimum alcohol pricing: not a magic bullet, but a necessary step

The announcement of a consultation on imposing a 45p per unit minimum alcohol price is, in general terms, a good thing, although it is no substitute for a broader, cross-departmental, rational strategy to encourage responsible drinking and harm reduction in a manner which respects individuals’ fedom.

It will do substantially more good than harm – although there are minorities in all three main parties substantially against it. In the case of Liberal Democrats (and presumably the same is true for some Tories) the opponents are libertarians who either believe in unfettered market forces or do not believe the state should interfere in such a way. I prefer the JS Mill test of harm done to others, tempered with a desire to tackle supermarket tax avoidance which is also relevant here, and is why the Scottish Government is facing an extensive legal challenge from the supermarkets which is fated to end up in the European courts.

A minimum price of 40p/unit (the Government is consulting on 45p) would only affect a relatively narrow types of drink. The two principal types that would see a significant price hike are: ‘value’ bottles of spirits from supermarkets, and super-strength ‘white cider’. The latter is principally sold only to those who wish to purchase the maximum possible alcohol for the minimum cost; it is not drunk socially or for enjoyment, and its market principally comprises individuals with significant addiction issues. When as a Katesgrove councillor I was trying to deal with issues arising from people with serious substance abuse issues congregating in a certain location, bottles of this stuff, mainly bought from the local Tesco, were the principal guide as to the intensity of recent activity. I do not believe it is a sign of a healthy free market that such products exist in their current form – in effect, to sustain the lifestyle of a street drinker.

Two other types would be partially affected. The very cheapest wine would no longer cost under £3.60 a bottle (£4.30 under Government proposals); additionally, the bulk discounting of drink principally by the big supermarkets would no longer be possible. This last step is good news for a different reason. One of the reasons that supermarkets have historically treated alcohol as a loss-leader is to avoid paying VAT. Want to know why they have become so keen on “£10 for a meal for two” and similar deals? It’s because they can sell bottles of wine on their books for £6 (which attract VAT) and claim their value is more like £3 for tax purposes. (This ruse will also be abolished thanks to the new anti-avoidance rules brought about by Liberal Democrat influence in Government).

This crude tax dodge, overdue to be ended, is also part of the reason why community pubs have faced huge price inflation over the long term, whereas the off-trade has held prices more or less at inflation-free levels for at least 20 years. That is a market abuse that has helped contribute to the closure of pubs (where everything’s subject to VAT) and to the increasing role of ‘pre-loading’ which contributes to many alcohol-related problems. In a nutshell, this is why CAMRA supports minimum pricing too.

None of this is a substitute for a proper strategy that focuses effort on reform of the pubcos to stop greedy debt-laden property developers making pubs unviable and closing them: reforming rehab services whose provision or lack thereof is little short of scandalous; and so on. But it’s a start, which does more harm than good; which is why I welcome this Government announcement.

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