Why British MPs are right to call for minimum pricing on alcohol
Today the House of Commons Health Select Committe release a comprehensive report on what needs to happen in policy terms to reduce alcohol related harm. Here an independent consultant examines why their headline recommendation of minimum pricing has a sound business case.
By jm24 on Friday, January 8th, 2010 - 728 words.
Today a comprehensive and candid investigation into UK national alcohol policy comes to fruition. A report released by the Health Select Committee highlights the damage caused by alcohol misuse and the need for a minimum pricing control. But proposals will be widely misunderstood — minimum pricing will not ‘punish the sensible majority’.
We’ve seen from our recent economic woes that markets do need degrees of regulation, particularly when a public interest is at risk. The difficulty, as always, is finding the balance. Like our financial sector, the alcohol supply market needs careful consideration in this respect; as well as the economic implications people’s health and social well-being are at stake.
The market conditions in which we drink have shifted dramatically and the affordability of alcohol has increased by 69% between 1980 and 2007[i]. Alcohol misuse now costs our economy over £21 billion a year[ii], made up from crime, health, social and lost productivity costs. In response, England has its own cross-governmental national alcohol harm reduction strategy. But this policy has largely skirted round the issue of supply, and its priorities have therefore not fully reflected the most evidence-based approaches.
A key component is missing. Whilst health authorities, councils and voluntary organisations are tackling issues from the ground up, a sense of frustration exists because the cheap and ready availability of alcohol makes it an improbable battle.
The fact is that the most effective way to reduce alcohol-related harm is through addressing price and availability[iii]. This does not need to be as radical is it sounds. A minimum price per unit policy would not affect prices in pubs and clubs that already sell above the probable benchmark of 50 pence per unit. But it would affect those that currently buy three-litre bottles of cider for £2.99.These drinkers are most likely to suffer or perpetrate the negative consequences of alcohol, whether it be domestic violence, depression or alcoholic liver disease.
It is estimated by independent academic research that a minimum price would prevent 3,400 deaths and reduce the number of hospital admissions by 98,000 per year[iv]. Such an approach would add significant strength to an alcohol harm reduction policy that may otherwise fail facing an era of pending public sector cuts and increasing social malaise.
A minimum price is opposed by those who have vested interests[v], those who mis-understand the implications for the majority of moderate drinkers, and those who object on the basis of excessive government interventionism. Of the three, only the latter argument has real credence and widespread misunderstanding had so far prevented informed public consideration of a minimum price measure. But our NHS and public services cannot continue to pick up the huge burden of acute costs alcohol places on them; reducing alcohol harm is not only a social responsibility, it is an economic necessity.
Our rights as individuals must therefore be considered against wider costs and harms to society. A city banker has the right to a performance-related pay, just as consumers have the right to shop around for good value products and services. But just as uncontrolled excess of city bonuses have contributed to a toxic banking system, the uncontrolled supply of cheap alcohol has exacerbated chronic levels of harmful alcohol consumption.
A cap on city bonuses may be a complicated argument, but we acknowledge the need to curb incentives that encourage excessive risk taking when the taxpayer bears the costs. In this way, whilst we all have the right to enjoy alcohol, we should curb incentives that encourage harmful alcohol use. A minimum price would not only make heavy drinkers less likely to damage themselves and others, it would also cost the taxpayer less to pay for the health care and social costs when they do. Alcohol policy should be more evidence based and less politically expedient.
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James Morris is an alcohol strategy consultant and writes on www.alcoholpolicy.net
[i] ‘The Price is Right: protecting communities through action on alcohol sales’ Alcohol Concern 2009
[ii] Prime Minister’s Strategy Unit ‘Interim Analytical Report’ 2004
[iii] As agreed by the WHO, the Chief Medical Officer and demonstrated by meta-analyses such as by the University of Sheffield’s 2008 ‘Independent Review of the Effects of Alcohol Pricing and Promotion’
[iv] University of Sheffield 2008, the ‘Independent Review of the Effects of Alcohol Pricing and Promotion’
[v] Mainly the supermarkets and sections of the alcohol indsutry, barring the pub trade who tend to support a minimum price due to loss of business to off-sales
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Why British MPs are right to call for minimum pricing on alcohol
Today the House of Commons Health Select Committe release a comprehensive report on what needs to happen in policy terms to reduce alcohol related harm. Here an independent consultant examines why their headline recommendation of minimum pricing has a sound business case.

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James,
I remember reading that Russia just did this with the price of Vodka a few weeks ago in The Moscow Times.
My thoughts are, why set minimums on the price of alcohol to control misuse and growing costs? couldn’t taxation of alcohol provide a more direct route to covering the costs you mentioned? At least that way it is directly taking the costs away from taxpayers who refrain from bouts of boozing and taxes those who are indulging.
Hi Randy,
Good point, in fact this is the proposed policy of the Tories who are likely to win the elections this year. There is one main flaw though – increased taxation would not stop huge multi-million pund retailers continuing to absorb the tax increases and continuing to sell heavily discounted alcohol.
Supermarkets use huge alcohol discounts to get people through the door, mainly becuase of the profit they will make when that customer does the rest of their shopping in their store. A minimum price would obviously prevent loss-leading and the tax regime is incrediably complicated.
A minimum price is actually supported by a lot of the pubs and producers because they have lost so much of their sales to supermarkets. In many cases its safer for people to drink in a supervised environment than at home or elsewhere.
There's some useful information on minimum pricing impacts on the Scottish National Party Website:
http://www.scotland.gov.uk/Topics/Health/health/A...
Would you be interested in exchanging website links.
I am at http://www.alcohol-explained.com
The HTML code is:
Why Do People Drink Alcohol , An information source explaining all types of alcohol.
If interested give me a short caption, your website address or the appropriate HTML code and pick a page on my website.
Perhaps you have a product or service you would like to advertise on my website. Payment only when a sale is made.
If interested contact me and we can discuss.
Thanks
Tom
Would you be interested in exchanging website links.
I am at http://www.alcohol-explained.com
The HTML code is:
Why Do People Drink Alcohol , An information source explaining all types of alcohol.
If interested give me a short caption, your website address or the appropriate HTML code and pick a page on my website.
Perhaps you have a product or service you would like to advertise on my website. Payment only when a sale is made.
If interested contact me and we can discuss.
Thanks
Tom
Would you be interested in exchanging website links.
I am at http://www.alcohol-explained.com
The HTML code is:
Why Do People Drink Alcohol , An information source explaining all types of alcohol.
If interested give me a short caption, your website address or the appropriate HTML code and pick a page on my website.
Perhaps you have a product or service you would like to advertise on my website. Payment only when a sale is made.
If interested contact me and we can discuss.
Thanks
Tom