Report debunks pricing as a weapon against consumption

17 October, 2008

Raising the cost of drinks will not change behaviour of drinkers, says Asda

A report for Asda by the Centre for Economic & Business Research suggests it would need a 50% increase in price on a £1 can of beer to bring about a 2% decline in demand.

The study by the independent think-tank concludes that using price to affect public alcohol consumption will only be effective if used

in conjunction with other measures around education, rehabilitation and availability.

The report was commissioned by the supermarket

as part of its response to the Scottish consultation on alcohol policy, which includes suggestions for minimum pricing regulations.

It s aid: "There is considerable uncertainty on exactly how alcohol consumption responds to price changes. Robust evidence on the price elasticity of demand for alcohol in Scotland does not exist.

"Given the uncertainty and lack of evidence for Scotland, pricing policies may be ineffective as tools for influencing alcohol consumption."

It also showed that the heaviest drinkers - who it says account for up to a third of all alcohol consumed - are least influenced by price, and argue d that minimum price regulations will punish lower income groups more than those with high spending power.

Commenting on the findings, an Asda spokesman said: "We have always maintained that minimum pricing will punish the whole of society in an attempt to change the behaviour of the few who misuse alcohol.

"We believe the CEBR report demonstrates that a multi-faceted approach is needed to tackle this complex and challenging issue, not one which relies on a system of minimum pricing and a ban on promotions." He added that Asda was "supportive of many of the proposals" put forward by the Scottish government, and had offered "a series of initiatives which we have already started to put into place".

He went on: "We would like the government to think again about minimum pricing so

we can continue to offer our 1.6 million Scottish customers value across the whole of the store ."

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