As expected the government today pressed ahead with its well-publicised plans for minimum pricing, admitting it will hit the poorest consumers in the pocket hardest, cost the Treasury £200m a year in lost revenue and that it has no idea what the financial impact will be on the drinks industry.
An impact assessment on the plans, based around a recommended 45p per unit minimum unit price, predicted the move would lead to a fall in consumption from the off-trade in beer of more than 14%, in spirits of nearly 8% and a 0.8% reduction in wine.
Under the plans it forecast drinks prices would in some cases rise by more than 100%, with the cost of four x 400ml strong dry cider, with a 5.3% abv increasing from £2.09 as of May 2012 to £4.19.
A four pack of 500ml Tesco lager, at 4% abv, would jump by 50% to £3.60.
Meanwhile the price of a bottle of Tesco value vodka would shoot up by 35%, it forecast, with a bottle of Tesco value whisky rising by more than a fifth.
However, the government claimed there will be huge health benefits, predicting an overall 3.3% fall in consumption will lead to 4,630 fewer alcohol related hospital admissions in the first year of the policy, rising to 24,600 fewer admissions after ten years.
The impact assessment admits that the plans, which will be subject to a 10-week consultation and are expected to result in a long and drawn out legal battle with the drinks industry, will hit those worst off more because they were more likely to purchase lower priced alcohol.
“Based on this premise, analysis suggests that the lowest decile might experience the highest impact as a proportion of total expenditure or of income,” said the report.
But the government insisted that the findings of its Sheffield model, that the heaviest consumers would reduce their consumption most in response to its plans for government controlled alcohol pricing, despite claims this week from the drinks industry that the evidence is severely flawed.
The Government also pressed ahead with its plans to ban mulit-buy promotions of alcohol, despite admitting there was a “lack of evidence” to support how effective it would be in reducing consumption.
It plans legislation to ban two for the price of one, three for two, buy-one-get-one-free, or buy six get 20% off promotions, as well as three for £10 where each bottle costs more than £3.33 and 24 cans of beer being sold for less than 24 times the price of one can.
ACS chief executive James Lowman claimed the moves ignored the efforts already made by the industry to tackle binge drinking.
“In the past five years, we have seen a reduction in alcohol consumption, increased consumer awareness of the risks associated with alcohol, and new positive partnerships tackling antisocial behaviour and underage drinking,” he said. “New sweeping changes to licensing rules and alcohol promotions will impose burdens on business and risk undermining the positive work underway.”
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