Sunday, 5 June 2011

Scottish Licensed Trade Association backs minimum price bid (wine for £10)

Yesterday's Scottish Daily Mail reported that the Scottish Licensed Trade Association has asked for a £1 minimum per unit of alcohol as the SNP prepares to put a minimum pricing bill through Parliament for the second time. Full story here: 

I have never seen the point of minimum pricing. Scotland is not independent and doesn't have closed borders. A UK-wide policy on alcohol (perhaps restricting alcohol sales below the cost price) seems far more reasonable. But the Scottish Licensed Trade Association's suggestion that 45p per unit is not enough and should be more than doubled in order to keep pubs open is breathtaking.

The SLTA was one of many organisations to publish the results of a CGA survey in 2009. The survey showed a clear relationship between pub closures and the smoking ban in Scotland, Wales, Northern Ireland and England. The piece carries the headline 'Smoking Ban To Blame For Pub Decline, Says New Research':
Oliver Griffiths, director of CR Consulting, said, “The decline of the British pub had started before the smoking ban but at a low level. The ban had a sudden and marked impact, accelerating the rate of decline.
“While it is not the only factor in the closure of pubs, the smoking ban is demonstrably the most significant cause of pub closures.”
We are not just talking of pub closures. We are talking of a sudden decline in the viability of pubs within a very short timespan.

It is not clear how such a dramatic hike in the unit price of alcohol will encourage customers back into pubs, even if pubs are already charging more than £1 per unit, because it is evident from the research that it wasn't price that was the problem in the first place.

The Scottish Government states that over 20 years alcohol prices in the off-trade have remained static and below the retail price index (increases kept below the rate of inflation). The prices in bars and other licensed outlets have risen but affordability in general is lower than it used to be. In other words there has been no radical change in the affordability of alcohol in shops in the last twenty years and no reason to attribute the sharp drops in pub fortunes to supermarket prices.

Minimum pricing will be good for nothing but creating mayhem in a country where many people can't afford shop alcohol prices. As recommended by the SLTA, it will do communities even more damage, without any likely impact on the closure rate of pubs. The recommended £1 per unit might persuade people to be grateful for a minimum price of 45p, in which case the licensed trade will have done the SNP an ill-deserved favour.

The issue is that the smoking ban prevented most bars from providing effective hospitality to their biggest customers. This is what the Scottish Licensed Trade Association needs to persuade the Scottish Government, rather than encouraging it to flex its muscles in restricting its market competitors.


handymanphil said...

The SLTA are proving to be yet another spineless bunch try to avoid the obvious "Great Big White Elephant" in the room! As you rightly point out Belinda, the CGA report both confirms & condemns the smoking ban for exactly what it is-the removal of 68% of all pubs regular customers.
If the SLTA think that making wine more expensive then they need to drink somemore "IrnBru" and grow a pair under those kilts of theirs and take the smoking ban on head first. The healthists are running amok, they need to be halted and minimum pricing will do nothing to bring customers back to pubs!

Bill Gibson said...

How long will it take for the penny to drop. Minimum Pricing was proven to be illegal by way of a Dutch Court Ruling in 1978

Ironic in a way, considering that the SLTA has turned to the Dutch Bar Owners to seek advice on amending the Smoking Ban