The price of alcohol
Sir, – The minimum price of alcohol proposals by your correspondents (Letters, May 1st) increase the incomes of the alcohol sector by allowing the sector to keep the extra revenues from higher prices. The Oireachtas Library and Research Service estimated in 2015 that this windfall gain was worth over €78.3 million a year to the alcohol sector. We do not return tobacco tax, fossil fuel tax, or other levies on demerit goods to the sectors producing demerit goods.
Recent data in circulation indicate that minimum pricing of alcohol will reduce healthcare costs by €7.4 million in year one. Thus for every €1 claimed health reduction costs from minimum pricing, the alcohol sector gains €10.58.
The Alcohol Sector (Profit Enhancement) Bill is a more accurate title for the Public Health (Alcohol) Bill.
The income distribution aspects of the minimum price proposals also require analysis. Higher-priced alcohol, presumably consumed by those on higher incomes, is not deemed a demerit good under these proposals and will not increase in price.
The attempt to export minimum pricing to Northern Ireland was ill-judged. In order to protect the annual €78.4 million income gain for the alcohol sector from minimum pricing in the Republic from cross-border shopping, the Republic sought to have its policy implemented in the neighbouring jurisdiction.
In next year’s Assembly elections the number of candidates seeking higher prices in Northern Ireland at the behest of the alcohol sector in the Republic is likely to be minimal.
The irony of negotiating a border in the Irish Sea and then complaining about cross-border shopping over the previous land border might also be examined.
The policy of income transfers from consumers to the producers of demerit goods is deeply flawed and regressive.
The Department of Health, its staff and its quangos have had a good innings in promoting the policy. Throughout their campaign they have failed to address why they wish to enhance the incomes of a sector they claim to oppose and to do so at the expense of the public through a regressive transfer. That debate has to take place before their policy is implemented. – Yours, etc,
Sir, – Minimum pricing on alcohol will not impact the pockets of any of the many healthcare professionals who put their names to the letter in Saturday’s Irish Times strongly endorsing its introduction here.
Minimum pricing is unlikely to hit the pockets of most of your readers as this initiative only raises the price of the cheapest drinks.
Minimum pricing will chiefly change the buying habits of the poorer sections of our society. Doubtless it will reduce how much alcohol they buy and consume but also doubtless it will reduce how much of their limited income is spent on putting food on the table, clothes on their back and a roof over their head.
Middle-class Ireland puts the boot into working-class Ireland again. – Yours, etc,