Minimum Unit Pricing

The Alcohol (Minimum Pricing) (Scotland) Bill was introduced on 31 October 2011.  

Whilst SGF accepts that the parliamentary arithmetic is such that the Minimum Unit Pricing Bill will become law we have, nonetheless, been raising our concerns about the proposed legislation in written and oral evidence submissions to Committees in the Scottish Parliament and through individual parliamentary meetings with MSPs. 

So, what are the concerns? 

Firstly, we are concerned about the disproportionate impact a minimum unit price will have on low income and moderate drinkers.The Scottish Government has singularly failed to model the impact of the policy on different income groups and a report by the authoritative Institute for Fiscal Studies concluded that “a minimum unit price would have a larger effect on low-income households.” 

The impact the policy will have on those already addicted to alcohol and on heavier drinkers, consuming products which will be left untouched by a moderate minimum unit price, is questionable.As is the potentially devastating impact the legislation will have on own-label products. 

The suggestion in the Financial Memorandum accompanying the Bill - that there could be an increase in the Licensing Fee in order to cover any additional costs for local authorities arising from the new law - is objectionable and could be an additional cost to the Social Responsibility Levy which Nicola Sturgeon has stated would be used to claw back any retail profits from minimum pricing. 

SGF is also concerned that for all of the Scottish Government’s talk of increased profits for the retail sector the vast majority of any extra profit – after wholesalers and producers take their slice – will, as research suggests, end up in the pockets of the large multiples which not only sell a greater proportion of cheaper products but also have a range of compensatory measures at their disposal with which our members cannot compete.This is a vitally important point when reviewing licensing fees and considering a social responsibility levy. 

Minimum pricing may also result in a proliferation in cross-border and internet sales.Some of the larger multiples have already proven how easy it was for them to undermine the 2010 Alcohol Act through online sales, a practice which could be exacerbated by minimum unit pricing.

Finally, we must take not of the considerable and informed opinion which has questioned the legality of the Bill within the parameters of EU law and other international trade obligations.  The possibility that our members use their valuable time and resources to comply with the legislation only for it to be struck down at a later date would be a preposterous situation.