Minimum pricing on alcohol now looks like a done deal, and I suspect we must make the best of it and move on. However, before we do so - and at the risk of creating a furore among virtually the whole alcohol supply trade - I keep wondering if we are once again piling ill-thought-out and complex regulation on to the statute book unnecessarily?
Excise duty already exists as a revenue generator and control mechanism for alcohol, and has been used for many years to manage affordability as well as to raise tax receipts. We are now told we need a minimum price control mechanism in addition to this to control consumption (conveniently ignoring the fact that per head consumption is decreasing of its own accord).
A part of the dilemma, and perhaps the first port of call for legislators, is the ad hoc nature of the duty regime on alcohol. At present, the only mechanism to properly recognise the alcoholic unit content is that of spirits: volume multiplied by alcoholic strength. This currently produces a duty charge of 27p per unit on spirits.
There are much wider variances in other areas. beer and lager is banded into three - low, normal and super - with duty per unit 10p on Skol, 20p on Stella and 24p on Special Brew. On cider, rates are banded at up to 7.5% abv and between 7.5% and 8.5%, but the per unit result is the same - just 7p. A similar rate applies to low-abv sparkling perry.
Wines are also banded and most wines pay the same duty as the band is so wide - from 5.5% to 15% abv. This means wines toward the top of the range attract a significantly lower rate per unit: 18p for Hardy’s Stamp Red against 25p for a wine with 10% abv. Ironically, this banding means the new lower bands of 4% to 5.5% for low alcohol brands such as First Cape actually attract a 20p per unit charge.
One suspects that vested interests would make a ‘proper’ realignment by alcohol units politically more difficult than the proposed minimum price, although that seems to me to be the grown-up, long-term solution if the government were really serious about this matter. This would allow a consistent policy in future years rather than ad hoc tinkering.
I should point out that the independent sector broadly welcomes minimum pricing as a means of curtailing the race to the bottom by the multiples, and my proposal would need further safeguards to be effective - preferably a ban on below-cost selling. However, it does seem to me that a serious solution really should involve a strict relationship between duty charged and alcohol units.