The case against Minimum Alcohol Pricing

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The EU seems to have killed Minimum Alcohol Pricing, for now at least. That's good news, but the case against it will still need to be made as its advocates push for it despite its illegality. Last week I went on Ireland's flagship news programme, Prime Time, to argue against it. In Ireland, the price floor being proposed is €1 per 10g of alcohol, which is 12.7ml – so a can of beer with 20g of alcohol must be sold for at least €2.00, a 14% ABV bottle of wine with 85g of alcohol for at least €8.50, and so on. Drinks that are already priced above this floor will be unaffected.

Minimum Alcohol Pricing does not even succeed on its own terms, for two reasons. One, it is extremely regressive. And two, it will probably not affect problem drinkers as much as moderate drinkers.

  1. Minimum alcohol pricing is regressive.

Galahad lager is Aldi’s own brand beer here in Ireland, and you can buy normally buy twelve cans of it for €9 – 75¢ per can. It contains 16g of alcohol per 500ml can, so its price floor under Minimum Pricing would have to rise to €1.60 per can. A man and a woman who drink within the recommended amounts (which are very low – more than three pints in a day is defined as being ‘binge drinking’) can drink 170g and 110g of alcohol respectively, 280g in total, per week. This equivalent to 17.5 cans between two people per week – just over one can a day each. Almost everybody would agree that these are moderate drinkers.

At the moment, they can do this for €13.13 per week (if they buy a couple of weeks’ worth at a time). Under Minimum Alcohol Pricing, this rises to €28.00 per week, a difference of €14.87. Over the course of a year this means that a couple who drink within the very low recommended limit at home would be €773.24 worse off under Minimum Pricing.

When I put this to Dr Steven Stewart, an advocate of Minimum Pricing, on Prime Time he said this was “just wrong” and the true figure was 70¢ per week (€36.40 per year) per person. That might be true of someone who drinks a quarter of a bottle of wine a week, or for someone who buys more expensive brand name beer, but it is not true for people who shop at Aldi or buy other budget lagers and wines.

The impact of Minimum Pricing is not felt disproportionately by people on tight budgets, it is felt exclusively by them. Not only is this regressive, it is misplaced – alcohol consumption rises with income, as does drinking large quantities of alcohol. So we’re hammering the poor even though the poor don’t actually seem to be the problem.

  1. Minimum alcohol pricing doesn’t deter problem drinking, and the health benefits are overblown.

As we demonstrated in our 2012 report by former NHS statistician and epidemiologist John Duffy, “The minimal evidence for minimum pricing”, the model that Minimum Pricing advocates use is deeply flawed. Among the assumptions it relies on is that alcoholics and other problem users are more sensitive to price than moderate drinkers. That is, when the price of booze goes up, alcoholics are more likely to drink less than people who don’t drink very much.

This assumption is based on a misinterpretation of data. When the price of one brand of alcohol goes up, alcoholics are the most likely to switch to another brand – they are indeed price sensitive in regard to the type of alcohol they drink. But they are actually the least likely to reduce their consumption of alcohol in general – as meta-analyses of the evidence have shown. For the heaviest drinkers, price elasticity of demand is “not significantly different from zero” – they won’t drink less almost no matter how high the price goes.

Advocates of Minimum Pricing typically point to Canada’s success in reducing deaths from alcohol abuse after introducing minimum pricing. But the studies that show this are typically quite bad – most lack any control group which is essential in a situation where alcohol consumption has been falling anyway, almost across the Western world. Apart from this, the research is dubious:

The key finding was that over the period 2002–2009, “a 10% increase in minimum price for all alcoholic beverages was associated with a 31.72% reduction in wholly alcohol attributable deaths”. Whilst this study was greeted as a breakthrough by public health lobbyists, independent statisticians have demurred.

In fact, the actual finding was that a 1% increase in pricing gives an estimated 3.172% decrease in wholly alcohol attributable deaths. Despite the complex statistical analysis used elsewhere in the paper, the authors then used a simple multiplication factor to estimate that a 10% increase in prices would therefore give a 31.72% decrease in mortality rates. Even this lawyer can see that a simple linear relationship cannot hold true. If it did, a 33% increase in price would reduce the estimated level of deaths by over 100%!

Got that? They found that a 1% rise in the minimum price led to a 3% fall in deaths and then just multiplied that by ten. This is sloppy in the extreme, obviously wrong to anyone with even a basic understanding of the issue, and advocates of Minimum Pricing should treat it and the researchers who produced it with caution.

Other points

There are other points to be made against Minimum Alcohol Pricing. It is not justifiable on cost grounds – unlike excise duties, it does not raise any more money for the government, only for supermarkets. Ireland has the second highest alcohol taxes in the EU already and, morbid as it may be, because heavy drinkers die young they usually end up saving the state money on other healthcare, social care and pensions costs.

We don’t really need to do more to curb drinking, despite what doctors like to tell us. Under-age drinking has fallen by 25 percent in the last ten years, and alcohol consumption across the board has been falling for decades.

The Irish health minister, Leo Varadkar, likes to point out that Ireland consumes much more alcohol than the OECD average. But the OECD average is skewed because it includes large countries where large sections of the population barely drink at all, like Turkey, Japan and the United States (where a third of adults don’t drink alcohol at all). In fact, Ireland is behind Austria and France and just barely ahead of Germany in terms of alcohol consumption – countries not exactly known for their sobriety, but not problem cases either.

People drink alcohol because they enjoy it. Being drunk can be fun, and having a beer or a glass of wine after work can help us unwind and relax. Everybody knows this, yet the debate that is taking place seems to ignore this fact altogether.

Doctors advocating this should back off – they are here to give us advice about how to live healthily, not force healthy lives upon us through the law.

But you don’t need to be a liberal to oppose Minimum Pricing – the case in favour of it is paper-thin even on its own terms. It will not affect problem drinkers, but it will give a kicking to any moderate drinker living on a tight budget. For once, thank goodness for the EU.