Wednesday, 29 November 2017

Unconsidered consequences (Part 97)

Whenever some headline-grabbing “public health” policy is announced, there are always some implications that haven’t been fully thought through, and minimum alcohol pricing is no exception.

One obvious one is the inclusion of alcoholic drinks in combined offers with something else, which has already caused a question mark to be raised over Marks & Spencer’s “dinner for two” deals. How will this affect the ubiquitous Wetherspoon meal deals, if the value of the alcoholic drink element can’t be accurately assessed? Are you sure you’re not undervaluing that burger to give an attractive price for the pint? The easiest answer is likely to be simply to ban such deals entirely. At least that way there will be certainty.

Then we come on to the issue of free samples. Go round any distillery in Scotland, many of which offer tours for free, and you’ll be given a dram of their own distinctive product. Obviously a nominal charge of a quid would cover it, but it’s another factor added into the equation. Is the value of the tour in itself really zero? Just the same applies to brewery tours, which historically have often provided generous hospitality in the sample room at the end.

And how about tasters in pubs, now seen as an integral part of the promotion of different beers? Individually they may be trivial, but there are plenty of reports of cheeky customers abusing the offer to get themselves a substantial amount of beer? Or the free pints sometimes given by licensees to favoured customers? It rarely happens any more, but in the past I would often get a pint in some pubs when delivering the local CAMRA magazine. There are also the free samples often provided to journalists and bloggers in the hope of a favourable write-up. I once got five cases of eight bottles each from Wells & Youngs. Will there be some definition of “fair dealing”, or will the whole concept become off-limits?

Looking at another angle, last week the beer community breathed a sigh of relief when the Chancellor decided to freeze duty in his budget. But, at the bottom end of the scale, surely the authorities will start to cast envious eyes over the gap between the value of duty+VAT and the minimum retail price. Duty+VAT on a 440ml can of Carling is 40.3p. I’m not saying anyone’s actually making a loss when they sell 40 cans for £20, but nobody’s making much profit either. But at 88p a can, there’s a massive slug of extra revenue for Tesco. Why shouldn’t more of that go to the public purse instead? And, for cheaper drinks, any inflationary effect of duty increases would be minimal, so the argument about it impoverishing customers would no longer apply.

Plenty of issues there for the Scottish government to consider. As has often been said, “legislate in haste, repent at leisure”.

25 comments:

  1. If it leads to a complete ban on samples in pubs then I'm all for it.

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    1. You seem to have been in a rather curmudgeonly mood over the past few days - I blame that pub near Heathrow.

      Actually, thinking about it, I can see it resulting in the end of any kind of combined deal including alcoholic drinks, as it will be such a grey area whether or not the non-alcoholic element represents a fair value.

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    2. Most meal deals in 'spoons are dual priced. One price for meal + soft drink and another price, usually one pound higher, for a meal plus alcoholic drink. So you could compute the the effective selling price of the alcohol from that. If the bar price of a soft drink is a pound then the booze is being sold for two.

      On the bright side: some poor impoverished lawyers will find work, looking at all the implications of the legislation.

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    3. It no more sees the end of meal deals than it sees the end of selling G&T's rather than gin + tonic separately. The purpose of this is to stop poor people getting bladdered cheaply. As long as (beer+pie) is being sold for more than (beer) then it's irrelevant, poor people won't spend £80 on 10x(beer+pie) when they could spend £25 for the beer (which will still be way over the minimum price anyway) What matters is the total alcohol that is in the package being bought, whether that's just a beer on its own, additional tonic water, or a steak.

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    4. I wouldn't be so confident. For example, supermarkets might be tempted to compete on offers like "buy your minimum price slab of Carling for £17.60 from us and get a multipack of Walkers for only £1." My expectation is that it will see the end of all deals combining alcohol with something else, even if may seem pretty obvious that they aren't infringing the legislation. The fair value of *everything* sold in conjunction with alcohol will have to be assessed, which may seem more trouble than it's worth.

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    5. If there is a minimum price for selling, surely that does apply if it is not solf but given away.

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    6. But freebies could easily be used as a means of in effect getting round the legislation. Free pint with every sandwich!

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    7. That doesn't work - because the law would view it as paying £3 (say) for (pint and sandwich) rather than £3 for sandwich and a free pint. And then it would calculate how many units you were getting for your £3, in the same way as if the pub tried to sell you a £3 tonic water with a free shot of gin.

      It's hypothetical anyway, as the only retailers in the on-trade that can dream of selling alcohol below the proposed minimum, are Tim Martin's beer supermarkets, and even then only in a handful of cases AIUI.

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    8. Also, don't forget that in Scotland you're not allowed drinks promotions which involve the supply of alcohol free of charge - including BOGOF and buy-sandwich-get-beer-free - under the Alcohol Etc. (Scotland) Act 2010.

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  2. That must be a first. Paul advocating higher taxes; and on booze. :-) :-)

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    1. Who is this "Paul" of whom you speak?

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    2. I'm not advocating higher taxes, just saying that the grasping authorities may see it as a golden opportunity to raise duty.

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  3. They will, of course, follow closely the Tobacco Control Industry playbook and all 'freebies' will be either forbidden or tightly controlled. So you can forget all about 'double points' from Tesco on that slab and any other inducements (that free bag of Walkers) that might cause people to drink alcohol, because we all know there is no safe limit....

    Maybe not straight away but as soon as the law is passed and the Public health lobby sees people using loopholes then the 'MUST BE DONE' will start. Expect a levy on home brew yeast then a double whammy on sugar (cos there is no safe level of sugar consumption so it'll be a shoo in for punitive taxation).

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    1. A logical next step would be to ban the issue of points against alcoholic drinks, because if your beer is sold *at* minimum price, then the effective value of the points will take it below.

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    2. Scaremongering fantasy, jack ketch. Yeast can, and is, re-used many times over in commercial breweries, and home-brewers can easily do the same. As for a sugar tax? Malt is the prime source of sugars in brewing; not the white crystalline substance sold in white 1Kg paper bags. I know plenty of brewers who would sell me a sack of malt, so problem solved.

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    3. Don't give the government ideas - for much of the 19th century beer taxation was via a tax on malt (and many adjuncts were banned).

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  4. It'll kill off more than a Spoons meal deal. It'll kill off pubs themselves. The goal is to reduce the number of drinkers. When you old timers die off, no ones replacing you. The kids have got the message. There is no safe level of alcohol. Ten years from now, drinkers will be as smokers are now.

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    1. I keep telling people that, but they won't listen :-(

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    2. Logically it is difficult to justify permitting the open sale of something that would, but for tradition, be a class A drug whilst making the sale of relatively harmless class C drugs, such as cannabis, illegal.

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    3. You think alcohol would be Class A? I'd suggest it would be better classified in 'C' with gamma hydroxybutyrate and the like. And didn't Cannabis go back into Class B? Keep up!

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    4. Based on this: https://www.theguardian.com/society/2010/nov/01/alcohol-more-harmful-than-heroin-crack
      Alcohol is the most dangerous drug ever. Tempts me to give it up and start mainlining on heroin :-)

      Seriously though: I don't think any drugs should be illegal for adults. I find it particularly silly that aClass A drug - morphine - can be prescribed as a painkiller but not class B cannabis which is very effective for a lot of chronic pain.

      Sorry 'mudge - off topic.

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    5. But that's only because alcohol is far more widely used than heroin and crack. To say it is more dangerous at the individual level is absurd.

      And I find it unedifying how cannabis campaigners are constantly banging on about how their substance of choice is far safer than alcohol. The two are completely different and thus not directly comparable, but by taking that line they are alienating people who they need on their side.

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  5. Today we are working with the owner of The Lion in Ramsey St Mary, Cambridgeshire to relaunch the pub this very day, 1st December 2017 at 17.00. God bless us all and our customers.

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