Why is the Government talking about alcohol prices again?
The pricing changes being planned now are not aimed at generating revenue through excise duty but tackling the high levels of problem drinking in the State with a range of measures which – notably – include minimum pricing.
What’s that?
It will see the State set the lowest price at which alcohol can be sold. This will based on how much alcohol a product contains. The more units in a bottle, the higher the price.
And what is this minimum price going to be?
We don’t know yet but figures used in the UK – which is also preparing to roll out minimum pricing – might give us some idea. The government in Scotland has proposed a minimum price of 50p per unit of alcohol. If we adopted that model, it would mean a bottle of wine with eight units of alcohol could cost no less than €4 while a two-litre bottle of cider would have to be sold at around that price. A 500ml can of lager would typically retail at €1 or more.
But why would the Government impose this kind of arbitrary floor?
International evidence suggests that price changes can have a big effect on how much people drink. Minimum pricing primarily hits heavy drinkers and young people who are more likely to seek out cheap drink.
Does it work?
Apparently so. Studies in Canada have shown that introducing a minimum price per unit of alcohol is a very effective way of decreasing alcohol consumption.
In Saskatchewan province in Canada, a 10 per cent increase in price was associated with an 8.4 per cent decrease in total alcohol consumption while British Columbia recorded a 32 per cent reduction in alcohol-related deaths one year after minimum price increases came into effect.
What impact will it have on the price of a pint in a pub?
None at all. Almost all drinks bought in the pub are already sold well above any likely minimum price so they will not be affected. Cheap ciders, lagers, spirits and wines will be hit hard.
Source: Conor Pope, Irish Times, 23/10/13
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