UK’s WSTA warns of “serious unintended consequences” of Minimum Pricing

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An increase in bootlegging, fake alcohol production, theft and cross-border sales are among the likely consequences should the UK government introduce Minimum Unit Pricing, claims the UK Wine & Spirit Trade Association which has warned that government plans to hike up the price of alcohol there risk boosting crime as well as damaging UK businesses and consumer health.

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25 February 2013

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In its submission to the government’s Consultation on the Alcohol Strategy, the WSTA has accused the government of failing to make a realistic assessment of the wider impacts of increasing the cost of alcohol on the economy and crime rates.

The trade body pointed out that a 50p MUP would set a minimum price of £4.88 for a bottle of wine in the UK compared to around £1.89 in France and it’s feared that consumers could turn their backs on UK retailers in favour of cheaper prices across the Channel.

Evidence from the Republic of Ireland shows that increasing alcohol prices leads to a clear shift to cross-border purchasing.
In 2008 – when prices were boosted here – alcohol sales in Northern Ireland increased by 25%, stated the WSTA.

In addition, increasing alcohol prices could risk pushing alcohol further into the hands of unregulated sellers which could increase the health risks to consumers. The WSTA has warned that, as the cost of alcohol rises, consumers will look for cheaper options which is likely to bolster the bootlegging of alcohol and the ‘White Van Trade’ (including the increased production of self-brewed alcohol for sale in addition to fake alcohol products).

The WSTA has also raised concerns about the impact that increased alcohol prices could have on retail theft. During Christmas 2012 alone, retail theft in the UK grew 3.4% compared to the same time the previous year leading to estimated losses of £999.7 million for British Businesses. The WSTA has argued that pushing up the price of alcohol will increase its attractiveness to thieves and cost businesses even more in the long run at a time when they’re already struggling to cope in the current economic climate.

Miles Beale, Chief Executive of the WSTA, which is leading the ‘Why Should Responsible Drinkers Pay More?’ campaign against MUP, stated, “There is a real risk that this illegal activity will increase if alcohol prices are forced up even more. Consumers in the UK already pay some of the highest prices in Europe for alcohol and further price rises could result in some serious unintended consequences that the Government has failed to consider.

“The Government’s plans to set higher alcohol prices could increase illicit, unregulated sales of alcohol which will risk harming consumers and depriving the Treasury of revenue. It will also have a massive detrimental effect on the UK economy, making British businesses more vulnerable as they lose out to cheaper and sometimes illegal, sources.”

A consumer poll by ComRes on behalf of the campaign already shows major public opposition to MUP with fewer that one in five overall (19%) supporting it and 87% believing that binge drinking will continue irrespective of the plans to set higher alcohol prices.

A 50p MUP would see 65% of alcohol prices in shops and supermarkets rise overnight. A bottle of wine (13% ABV) would rise in price from £3.69 to £4.88. A bottle of vodka (37.5% ABV) would rise in price from £10.00 to £13.13 while a 12-pack of lager (4% ABV) would rise in price from £8 to £10.56.

 A 45p minimum unit price would see 52% of alcohol prices in shops and supermarkets rise overnight.  A bottle of wine (13% ABV) would rise in price from £3.69 to £4.39.   A bottle of vodka (37.5% ABV) would rise in price from £10.00 to £11.81. A 12-pack of lager (4% ABV) would rise in price from £8 to £9.50.

 

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