Thursday, 9 February 2012

Mind the gap

Minimum alcohol pricing is often mistakenly seen by those such as CAMRA who wish to defend pubs as a means of improving their competitive situation by reducing the price differential vis-a-vis the off-trade. However, as Dick Puddlecote has pointed out to me, the research by the University of Sheffield on which many of the arguments for minimum pricing are based in fact puts forward as one of its favoured options setting different minimum prices for on- and off-trades, with the former more than twice the latter.

Differential minimum pricing for on-trade and off-trade leads to more substantial reductions in consumption (30p off-trade together with an 80p on-trade minimum price -2.1% versus -0.6% for 30p only; 40p together with 100p -5.4% compared to -2.6% for 40p only). This is firstly because much of the consumption by younger and hazardous drinking groups (including those at increased risk of criminal offending due to high intake on a particular day) occurs in the on-trade. It is also because increasing prices of cheaper alcohol in the on-trade dampens down the behaviour switching effects when off-trade prices are increased.
Now, 80p per unit would start to affect many Wetherspoon’s pubs (not to mention Sam Smith’s), and 100p would affect a large slice of on-trade beer outside London and the South-East.

Anti-drink campaigners identify two separate problems caused by alcohol – long-term health damage resulting from harmful levels of consumption over many years, and disorder and violence resulting from excessive consumption on specific occasions. The two overlap, but they’re not remotely the same thing, and a flat-rate minimum price is only really going to address the first. Although there may be some contribution from “pre-loading”, alcohol-related disorder is overwhelmingly associated with on-trade consumption.

So, pub-lovers, be very careful before you succumb to the embrace of minimum pricing, as it could very well end up being toxic to the thing you hoped to protect.

18 comments:

  1. "much of the consumption by younger and hazardous drinking groups (including those at increased risk of criminal offending due to high intake on a particular day) occurs in the on-trade."

    Do they have any proof of this assumption?

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  2. I'm sure there are stats in the (very lengthy) document to back it up. But, while I hold no brief for its conclusions, I would have thought the assertion that most late-night alcohol-related disorder was associated with on-trade consumption came into the category of "the bleeding obvious".

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  3. but the point is its probably the preloading that did it

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  4. OO its the first drink of the evening that's irresponsible.

    Not pub landlords serving drunks at the end of the evening.

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  5. The Sheffield study I have read says, in conclusion, the following:

    "The evidence base for a direct association between alcohol taxation or price changes and crime-related outcomes mainly comprises studies that analysed what had happened following actual changes in alcohol price or tax, primarily in the US and Scandinavia, and modelling studies that estimated the expected effects of future alcohol tax or price changes and levels of criminal activity.

    This evidence suggested that, on the whole, price and tax increases tend to be associated with reductions in crime, whereas price and tax reductions have less consistent relationships with crime. There appeared to be relatively stronger associations between alcohol price and overall crime, violent crime, sexual assault, and a weaker association for criminal damage.

    Only a few studies, with sometimes inconsistent findings, were available for the links between alcohol pricing and specific offence types, namely; homicide, domestic violence, public order offences, drunk and disorderly behaviour, robbery and anti-social behaviour. Most, but not all, identified studies supported an association between increases in alcohol taxation/pricing and decreased crime. Thus, no firm conclusions can be drawn on whether or not there are direct effects of pricing changes on the latter types of offences."

    So it would appear the jury's still out on this one ... however as our host posits we should beware of what we wish for.

    It is up to publicans to add value to the alcohol they serve ... good customer service, conducive surroundings, food/entertainment etc.

    Although I believe that the "deep discounting that the off-trade indulge in is deeply damaging to not just the on trade but to the wider community as well ... for more on this see Big Barn article here:

    http://localfoodnews.wordpress.com/2012/02/03/our-disappearing-pubs-and-post-offices-the-glue-that-holds-a-community-together/

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  6. Crikey Sam,

    "Craft Beer vs Cask Ale ... who cares as long as it sells by the shed-load!"

    sounds like "responsible" alcohol retailing to me.

    Pointing the finger at Tesco and saying "its not us" is not a strategy of success there fella.

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  7. How do you define "deep discounting"? Is it Majestic Wine doing 1 or £9.99, 2 for £11.98, or just the cheap crap the plebs buy?

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  8. Is there such a thing as per unit cost sales tax in the UK?

    Minimum pricing might be just another way to increase the sales tax income for the state.

    Where I live in America, we have a state sales tax and the cost of excise taxes are included in the unit price that gets sales taxed.

    We pay a tax on a tax, double screwed!!!

    Gary K.

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  9. not sure if the original reply got posted or not ...

    not advocating irresponsible retailing just pointing out the disparity between what pub's are allowed to get away with in terms of discounting/promotions and what the off-trade get away with ... so Cooking Lager have thanked you on my blog piece

    Curmudgeon I make no distinction between consumer or product consumed

    Finally what about the disparity in duty levied on beer (and the rate of increase) and those levied on wines and spirits

    Apologies if I have offended by expressing an opinion

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  10. @Publican Sam - no offence here, robust debate is welcome, so long as it doesn't become personal.

    I think you'll find that duty per alcohol unit is still lower for beer than it is for wine and spirits.

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  11. Most of the 'trouble' associated with excessive alcohol consumption in my neck of the woods is caused by irresponsible publicans continuing to serve people who have clearly had enough (what that means varies from individual to individual).

    It is not due to the price of the units of alcohol.

    Our Wetherspoons and the other pubs selling cheaper drinks have to deal with very little trouble compared to the established late night meeting places. Yes, the people who cause the trouble often start off in these pubs but they move on to cause trouble where the drinks are significantly more expensive at the end of the night.

    Also the real community pubs who have less 'pub crawling' traffic have their excessive drinkers who walk home and retire to bed when they run out of money - causing no one except themselves any harm.

    Minimum pricing may influence how much people drink overall, but it will have no effect on the problems caused by certain people when they have had too much to drink on a particular night.

    Making the minimum prices different between on and off sales is just another way of killing off the Pubs, so drinking at home becomes the norm. Drinkers then become 'anti-social drug use' - leading to further tax hikes and the denormalisation of alcohol.

    Russell

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  12. I have to say I agree with Sam. While it could be argued that most alcohol related disorder and antisocial behaviour happens around the on-trade, which is in itself a pointless statement. It's probably also true that all disorder and antisocial behaviour happens outside of people's homes. It takes a special kind of idiot to get pissed up on cheap vodka at home and then vandalise their own house. The issue here isn't a question of price it's a question of availability. Supermarkets selling 60 cans of Carling for £32 with a maximum purchase of 6 cases (120 beers) is in no way encouraging responsible drinking. How many publicans would allow someone to turn up at the bar and order 120 pints to share between their 6 mates.

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  13. But the two are not remotely comparable - there's nothing to say if you buy 60 cans of Carling in the off-trade you're going to drink it all at once, just the same with a couple of cases of Merlot from Majestic Wine.

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  14. Publican Sam, would you have a link to the Scandinavian evidence that increases in price reduce crime? I would be very interested in finding out how much the decrease was, how long it lasted and whether there were other decreases and increases which happened without price shifts.

    If it's anything like influence price has one consumption, the evidence starts to look pretty weak upon close inspection.

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  15. According to one of our members, there was an interesting program on Panorama last night (on iPlayer) that had the statistic that "95% of the hospital admissions for alcohol related problems are for people who did their drinking at home, against only 5% for people who obtained their alcohol in the pub."

    Not sure where this gets us...

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  16. May well be true in the sense of those with chronic alcohol problems, as if you are an alcoholic you are likely to get most of your supplies in the off-trade because it is much cheaper. But many go to pubs as well, and I've come across a few alcoholics over the years whose drinking was predominantly of beer in pubs.

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  17. Depends I guess on their definition of "alcohol related problems" - will have to watch it later.

    I ended up in A&E because I tripped over a concrete kerb at a beer festival and ended up cutting my knee open and needing stitches. Was that a alcohol related problem?

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  18. I ended up in A&E because I tripped over a concrete kerb at a beer festival and ended up cutting my knee open and needing stitches. Was that a alcohol related problem?

    Almost certainly. However, for hospital reporting purposes, even if you were stone cold sober there would be an apportionment of this injury to alcohol.

    Here's some reading:
    More "statistics" from the anti-alcohol lobby:
    http://www.guardian.co.uk/society/2011/dec/09/hospital-admissions-drinking-double?newsfeed=true

    And why we shouldn't take these numbers at face value:
    http://www.forbes.com/sites/timworstall/2011/12/10/how-to-lie-with-numbers-alcohol-and-health-care-edition/

    This article from May this year gives a shocking insight into how hospital admissions are measured:
    http://www.straightstatistics.org/article/drink-and-disease-how-figures-can-confuse

    A short extract from the last article:
    It’s largely a function of methodology. Alcohol-related admissions are calculated in such a way that if you are unlucky enough, say, to be involved in a fire and admitted to hospital for the treatment of your burns, it will count as 0.38 of an alcohol-related admission – unless you happen to be under 15, when it won’t count at all.
    If you drown, it counts as 0.34 of an alcohol-related admission – though most people unlucky enough to drown aren’t admitted to hospital. Getting chilled to the bone (accidental excessive cold) counts for 0.25 of an admission, intentional self-harm to 0.20 per cent of an admission.
    These fractions apply whether or not there was any evidence you had been drinking before these disasters befell you.

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