Kiwis are ready to drink responsibly - yeah right
By ANTHONY HUBBARD - Sunday Star Times
Last updated 05:00 02/05/2010

The Law Commission has recommended sweeping changes to the country's liquor laws. But which are likely to become law, and what difference would they make?


Proposal: A 50% rise in the excise tax on alcohol.

Pros and cons: There is "conclusive" evidence, according to the commission, that price changes affect alcohol consumption. The increase in excise tax, if passed on to consumers, would cut consumption by about 5% and save $72 million a year in alcohol-related harm and health care. The widespread availability of cheap alcohol has encouraged excessive and harmful drinking, especially by the young. Excise tax increases are also fair because they broadly reflect a "user pays" principle: those who drink the most alcohol pay the most tax.

What difference would it make? Increased taxes probably would reduce harmful consumption if passed on to consumers but would they be? Labour's Lianne Dalziel, who as a cabinet minister asked the commission to report on the liquor laws, says supermarkets, which now sell 30% of beer and nearly 60% of wine, "have so much power they can insist producers absorb the excise increase". It is for this reason that the commission also recommended the government look into a minimum-price scheme for alcohol to put a limit on the sale of cheap alcohol.

Odds: Very low. Justice Minister Simon Power, the man in charge of liquor law reform, says it is "extremely unlikely" the government will raise excise taxes. He has given no reason, although it is understood the government is worried about the possible effect on the embattled wine industry. It also doesn't want to raise excise taxes at a time when it is raising GST to 15%.


Proposal: The government investigate a minimum-price scheme.

Pros and cons: A minimum price targets cheap alcohol, the favourite tipple of heavy and young drinkers. It has little effect on moderate drinkers, says the commission. It would directly affect prices, unlike excise tax increases, which affect retail prices only if passed on. However, there is very limited experience of it internationally. It is used in some rural Australian areas with high populations of Aboriginal people. Scotland has committed to a scheme under legislation introduced last year. It would clearly involve enforcement costs. But the chief drawback is that to be effective, regulators would have to know exactly how much retailers charge for various kinds of beer, wine and spirits, and what volumes they sell. The Retailers' Association refused to give the Law Commission this information except under detailed conditions, which the commission refused.

What difference would it make? Nobody knows, because it hasn't been tried in any significant competitive market. Potentially it could cut consumption by problem drinkers the young and the heavy boozers by driving up prices of heavily discounted liquor. The moderate drinkers would probably be less affected.

Odds: Probably low, but there's a chance the government would see it as a viable alternative to excise tax increases. It might smack too much of nanny state and interference in the market, but it would not involve tax increases. And it may help the problem.


Proposal: Return the purchasing age to 20. Eighteen and 19-year- olds would not be able to buy liquor or drink in bars and pubs.

Pros and cons: Police told the commission that the lowering of the age to 18 had led to negative outcomes in youth drinking and offending, and that the "de facto drinking age was now 14-17 or even younger". Nearly 80% of submissions to the commission supported an increase in the age. The counter-argument tends to be couched in terms of democratic rights rather than the social harm of youthful drinking. If you can vote and go to war at 18, why can't you drink?

What difference would it make? The commission argues there would be a reduction in underage drinking and the social harm this causes, although the industry would lose sales. The social cost trumps the commercial argument, according to the commission, especially as much more is known now about the harmful effects of alcohol on the brains of the young.

Odds: Age seems to be one of the most likely issues that would be left to a conscience vote and guessing how the MPs would jump is difficult. Polls show that many people think the drop in the drinking age has been something of a disaster but 18-year-old drinkers have the vote. Who will the politicians listen to?


Proposal: Bars and clubs should close no later than 4am, and should admit no new customers after 2am. Off-licences should stop selling liquor at 10pm and not open again till 9am.

Pros and cons: The steep increase in 24-hour trading, and the huge increase in late-opening bars, has led to increased intoxication and alcohol harm, according to police. International evidence the commission cites studies from Canada, Iceland and Australia shows similar effects. The police also told the commission that restricting off-licence hours would encourage people into more regulated drinking environments and away from unsupervised or "car boot" drinking. The one-way door in bars after 2am would prevent a sudden influx on to the streets of patrons at one time, decreasing the scope for trouble. However, Auckland mayor John Banks and others have warned that earlier closing would dampen the cheer at Rugby World Cup venues.

What difference would it make? The police found fewer on-licence opening hours in Timaru led to less violent offending. Similar results have been found in Brazil and New South Wales.

Odds: Fairly good. The government's bill will not go into effect till after the end of the world cup. And a national closing time of 4am can hardly be criticised as wowserism running riot. This is an area where MPs can change the rules without risking too big a backlash.


Proposal: Restricting the places alcohol can be sold, to prevent the proliferation of alcohol outlets, expand the grounds for declining a liquor licence and provide for more local input into liquor licensing decisions.

Pros and cons: Increased availability of alcohol has led to greater consumption and boosted all the attendant problems. At present, it is too easy to obtain a licence and too hard to lose one, and local control is limited. Under the proposal, councils would have local alcohol plans. Local people who are affected by the proliferation of outlets would have more control. The downside is convenience: with fewer outlets, the consumer has less access to liquor.

What difference would it make? Some effect on availability and consumption, and increased local control.

Odds: Good. Simon Power has signalled that the new law would "be regulatory in nature, with an emphasis on alcohol availability and licensing". The changes would be widely popular.

More here.