Retail Drinks slams NT minimum alcohol price report

A report commissioned by the Northern Territory government which claimed to prove the success of minimum alcohol pricing in the region has been slated by industry body Retail Drinks Australia.

The report and a subsequent media release by the territorial government heralded the results, which the government said showed that alcohol reforms, notably Minimum Unit Pricing (MUP) were working in reducing alcohol related harm.

It claimed to show that key indicators of the effects of alcohol, such as alcohol wholesale supply per capita, alcohol related offences and ambulance rides were in decline due to reforms, and that the introduction of MUP coincided with a “wide range of benefits to the community”.

But its conclusions were heavily criticised by Retail Drinks Australia, which represents the interests of Australia’s packaged retail liquor stores.

Retail Drinks CEO Julie Ryan said it was “astonishing” that the NT Government would release a report with such “glaring and self-admitted inadequacies”.

“We really have to ask the question how a report can form a conclusion that MUP was successful, when by its own admission, it cannot separate out the impact of MUP from other alcohol-related policies.”

Contrary to the government-commissioned report, Retails Drinks said a Frontier Economics report it commissioned, which will be available publicly soon, showed that alcohol sales actually increased by over 2 million standard drinks compared to the prior year before the introduction of MUP, and that per capita consumption per week has actually increased by 1.2 per cent.

Minimum unit pricing (MUP) was introduced in the Northern Territory in October 2018, setting the standard at $1.30 per standard drink following a recommendation in the 2017 Alcohol Policy and Legislation Review.

Also introduced was a banned drinker register and police auxiliary liquor inspectors (PALIs) for the Alice Springs, Katherine, and Tennant Creek areas, with the aim of minimising harm associated with the availability of high abv, low-cost alcohol.

The measures aimed to “reduce harmful consumption of alcoholic beverages” whilst having “minimal impact” on moderate consumers.

What did the MUP report say?

Despite reporting that a number of performance indicators, including total alcohol wholesale supply per capita, alcohol related offences and ambulance rides were in decline, the report itself said that some of these changes were a “continuation of trends to which the MUP has had an added effect, or coincided with other interventions that were implemented at a similar time meaning the independent impact of MUP was impossible to Distinguish [sic].”

The report admitted that while there was a significant decrease in the rate of assault-related hospital admissions, there was also evidence of some increase in alcohol and other drug treatment episodes.

It also noted that “it will be difficult to attribute any reductions in alcohol-related harm to any one individual policy initiative (i.e., MUP, BDR, PALIs), given the number of initiatives enacted in a relatively short time.”

Following the report, the NT Minister for Health and Attorney-General, Natasha Fyles said that strong measures with MUP, the banned drinks register and PALI’s are responsible for these “positive results”.

Professor Peter Miller from Deakin University’s Centre for Drug use, Addictive and Anti-social Behaviour Research Centre (CEDAAR), who led the research, said they were great outcomes and directly related to the reform initiatives.

“The introduction of the MUP has reduced cask wine sales, and some associated harms, without impacting the price of other beverages in the Northern Territory,” he said.

“The methods used in this report have allowed for an assessment of changes across a range of outcomes and the staggered implementation of different policy elements in different locations allows for some teasing out of differential impacts.

“While these are promising outcomes, providing crucial baseline and interim findings, changes in social trends require more time to be certain and longer term evaluations are needed.”

But Retail Drinks said that the report was “inconclusive and inadequate” and warned of “significant inconsistencies” in its data.

“Put simply, since the floor price was introduced into the NT, Territorians have purchased more alcohol,” said Retail Drinks CEO Julie Ryan.

“We know that problem drinkers are the least price elastic, in other words, the least likely to change their behaviour in relation to a change in price.

“When MUP was first introduced, we issued a strong warning that substituting other products, both alcohol and other substances of intoxication, would occur, which has been supported by the Frontier Economics’ Report.

“According to the 12 months of sales data analysed after MUP was introduced, there was an almost 50 per cent reduction in cask wine sales but significant increases were recorded across every other alcohol category, including 15 per cent growth in spirits.”

She said it was too early to properly determine the impact of MUP and that further analysis was needed, suggesting an evaluation of the measures at the three-year mark.

“Given that MUP in the NT has only been in place for slightly over 18 months, it is still far too early to tell the full impact on long-term consumer behaviour, particularly that of problem drinkers which it was intended to target.

“We are not confident that any methodology exists which can properly isolate the impacts of the MUP on alcohol related harm, when over 200 policy measures were implemented in the NT at the same time.

“200 darts were thrown at the dartboard of alcohol related harm and to allege you can isolate the specific incremental impact of just one is just not plausible.”

Minimum Unit Pricing

The World Health Organization (WHO) recommends the use of pricing and taxation policies to reduce the harmful use of alcohol.

But in practice, it has proven a much more convoluted subject. MUP in particular has proven a controversial topic with academics, governments and health organisation, not to mention the alcohol industry.

One country that has implemented MUP is Scotland, which introduced it in 2018. There, minimum unit price is currently set at 50 pence (95 cents AUD) per unit.

According to a study in the British Medical Journal published in September 2019, the introduction of MUP In Scotland appeared to have been successful in the short term by reducing the amount of alcohol purchased by households in Scotland in a targeted way – only affecting reductions in households that bought the most alcohol.

However it has also been reported that alcohol sales across the border with England rose after minimum pricing was introduced, and experts raised fears that heavy drinkers are being driven to illegal drugs due to the scheme. Metrics from Nielsen, which were reported by Public Health Scotland, found there had been a 14% increase in total value purchases across all alcohol in Scotland in the wake of MUP, with this partly due to a 10% increase in average prices.

Retail Drinks argued that MUP is a “blunt instrument” which effectively punishes all drinkers regardless of whether their drinking habits are harmful or not.

It said MUP discriminates against low-income earners such as pensioners by assuming they are ‘problem’ drinkers. The organisation said it causes target drinkers to change the type or category of alcohol they drink, attempt to manufacture their own unsafe alcohol, and potentially switch to other intoxicating substances.

“At a practical level the implementation and ongoing costs for retailers to manage the MUP are significant and outweigh any margin benefits/reputational impacts from an increase in prices on some products,” Retail Drinks said.

Articles published under the media release byline are news produced by the relevant business and remain unedited by Brews News.

This media release was circulated by Retail Drinks Australia.

Retail Drinks Australia (Retail Drinks) has today called for an independent inquiry into the NT Government commissioned one-year evaluation report of the effectiveness of minimum unit pricing (MUP).

CEO Julie Ryan said that the independent inquiry was needed because of the report’s inconsistent and inaccurate conclusions on MUP and serious questions relating to the integrity of the authors’ presentation of the data.

“The wholesale alcohol sales data on which the report’s authors relied on to derive their conclusions has not been publicly released and won’t be until September which is a month after the NT election.

“Given the discrepancies with retail data, we independently sourced the majority of the wholesale numbers that were provided to the NT Government.

“We can now conclusively state that, on review of this wholesale data, there has been a significant increase in spirits sold in the NT, as well as a significant increase in bottled wine since the introduction of the floor price.

“However, the MUP report says the exact opposite, that these categories declined.”

Ms Ryan noted that the wholesale data discrepancies were not the only issues to interrogate, pointing to the report’s conclusion that businesses had found the legislation relatively easy to implement and had not been impacted financially by the introduction of the floor price.

“The implementation of the floor price legislation has cost liquor retailers millions of dollars in one-time cost to adjust their systems, and significant further costs remain ongoing.

“The floor price was also introduced at a time of significant economic downturn in the Territory when all businesses, especially retail, have reported poor performance.

“It is simply not plausible to reach a conclusion that business has not been impacted, and we can confirm our members, who represent the majority of the liquor retailers in the NT who actually have to implement this legislation, do not have that sentiment.”

Ryan said that additional scrutiny from an independent inquiry was required to justify the expenditure of NT taxpayer money on the report.

“Given that this report has been funded by NT taxpayers, there is an obligation to ensure that the authors have completed a thorough and unbiased evaluation of MUP.

“If the report’s authors have made claims about MUP which are misleading then an independent inquiry is the only way to get to the bottom of these discrepancies,” Ryan said.

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