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Minimum pricing criticised by health campaigners but welcomed by trade

Government plans to set minimum prices for alcohol by banning the sale of drinks below cost price have been criticised by health campaigners but have been welcomed by the wine trade

The plans are wholly in line with Decanter’s stated viewpoint on the issue.

The Coalition Government yesterday announced retailers would not be allowed to sell wine, beer and spirits at below cost price plus VAT.

This would put a minimum price for a standard bottle of wine at £2.03, medium-strength lager at £0.38 per 440ml, whisky at £8 per 700ml, and vodka at £10.71 per litre.

While the Wine and Spirit Trade Association, and Decanter, welcomed the news, other groups such as Alcohol Concern are dismayed at measures they say will make no difference to problem drinking in the UK.

WSTA chief executive Jeremy Beadles said a ban on below-cost sales was the ‘practical’ way to implement a minimum price policy.

He added, ‘It’s equally vital to recognise that alcohol pricing and taxation cannot provide the solution to alcohol misuse. What’s needed is education and rigorous enforcement of laws to address misuse and related anti-social behaviour.’

In June last year, a call by NICE (the National Institute for Health and Clinical Excellence) to introduce minimum pricing per unit of alcohol was dismissed as ‘totally misguided and probably illegal’ by the WSTA.

Decanter’s editor Guy Woodward argued last February that ending loss-leading sales would be ‘a victory for common sense’.

‘Raising the price of wine does not wholly tackle the issue [of problem drinking]. ‘The real problem,’ he wrote in the March 2010 issue of Decanter, ‘lies with supermarkets who use wine as a loss-leader, slashing margins, bullying suppliers and dragging down prices in order to attract customers…Selling wine at a loss helps neither consumers nor the trade.’

However, doctors and health professionals argue that the government’s plans do not go nearly far enough.

Don Shenker of Alcohol Concern said, ‘Duty is so low in the UK that it will still be possible to sell very cheap alcohol and be within the law.’

Sir Ian Gilmore of the Royal College of Physicians told the BBC, ‘It’s a step in the right direction but it’s a very very small step. We believe in practice just a tiny fraction of cheap drink will get caught by this change.’

Sir Ian said that supermarkets would not be affected by the change – as ‘even where they a’re heavily discounted, they will not fall below this level.’

The British Medical Association the move would ‘not really make that much difference.’

The Daily Mail pointed out that the popular ‘3 for £10’ deals on wine, which run across most supermarket lists, would be unaffected by the new ruling. Most supermarkets’ cheapest wines are just above the £3 mark.

Sainsbury’s told Decanter.com it does not sell alcohol below duty plus VAT and said ‘we recognise our duty to be a responsible retailer of alcohol’, adding that it has an active policy to prevent underage drinking, as well following Department of Health guidelines on labelling information.

Tesco executive director Lucy Neville-Rolfe said the government’s move was ‘reasonable’, but added, ‘price is just one factor. Tesco has taken the lead by providing better labelling, preventing underage sales and supporting education partnerships alongside local schools and councils.’

image courtesy of www.winefugitive.com

Written by Adam Lechmere

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