Ban on below cost alcohol sales would be 40 times less effective than minimum pricing

Roll up, roll up! Alcohol still going cheap. Sang Tan/AP

The British Medical Journal’s investigation into the role played by the alcohol industry in public health policy focuses on the government’s decision to drop its commitment to introduce a minimum unit price for alcohol and instead bring in a ban on selling alcohol “below cost”.

Our research at the University of Sheffield shows that while minimum unit pricing would be effective in reducing the harm caused by alcohol without penalising responsible drinkers, the government’s chosen policy of banning below cost selling would have very little impact on the problem.

Minimum pricing vs below cost ban

To inform the government’s decision-making, we first looked at minimum unit pricing: setting a threshold below which a unit of alcohol cannot be sold to consumers. The government focused on a threshold of 45p per unit – which would mean a bottle of wine that contained nine units of alcohol would cost at least £4.05, and a pint of beer containing two units would cost no less than 90p.

We then looked at banning below cost selling, which also sets a minimum price threshold but bases the threshold on the cost of the tax (duty and VAT) payable on the product. As duty is very low on cider, higher on beer and wine, and higher still on spirits, this means a unit of cider could cost as little as 6p, while a unit of vodka would need to cost at least 34p. However, for all types of drink the price thresholds under a below cost selling ban are much lower than the 45p per unit threshold under minimum unit pricing.

This difference matters when we look at the effects these two policies would have on alcohol consumption and the harm it causes.

By analysing data on the relationship between alcohol prices, consumption and spending, and the health risks posed by drinking, we found big differences in the effectiveness of the two policies.

Introducing a 45p minimum unit price was estimated to reduce alcohol consumption by 1.6%, leading to approximately 625 fewer deaths per year due to alcohol, 23,700 fewer hospital admissions and 34,200 fewer crimes.

In contrast, the lower price thresholds of a below cost selling ban mean that policy would only reduce consumption by just 0.04%, leading to around 15 fewer deaths, 500 fewer hospital admissions and 900 fewer crimes related to alcohol per year.

This 40 to 50-fold difference in the effectiveness of the two policies led us to conclude that the government’s chosen policy of banning below cost selling would not be an effective way of reducing the harm caused by alcohol – the very point of the government’s foray into this area. It would simply affect too few products by too small an amount to make a substantive dent in the rate of alcohol-related harm.

Clear evidence

When announcing the decision to downgrade minimum unit pricing from a commitment to “under consideration”, Home Office minister Jeremy Browne voiced concerns the policy may “penalise responsible drinkers”. Our research has consistently shown this would not be the case.

Minimum unit pricing only directly affects alcohol sold below the price threshold; this tends to be high-strength, low-quality or sold in multi-packs. Therefore, people are only affected to the extent that they buy these types of drinks.

Moderate drinkers tend to buy higher priced alcohol in smaller packs and as such, less of the alcohol they buy would be affected by minimum pricing.

We estimate that moderate drinkers would reduce their consumption by around two units per year under a 45p minimum unit price – the equivalent of a pint of beer per year. In contrast, those drinking at harmful level are estimated to reduce their consumption by around 135 units per year. This targeted effect of the policy on those at greatest risk of harm occurs because these groups buy more of the alcohol which would increase in price.

These findings are supported by a wider body of scientific research including evaluations of the effects of minimum pricing in Canada. While the government must take this evidence into account alongside a range of other considerations and perspectives when choosing its alcohol policies, today’s BMJ report has raised questions about the alcohol industry’s role in that process.

The evidence on minimum unit pricing is clear: it would be effective, targeted on those at greatest risk of harm and substantially more effective than banning below cost selling.