ALMR: Below-cost plans are a 'fudged compromise'

A trade leader has branded the government's plan to ban alcohol sales below duty plus VAT as a "fudged compromise".

Nick Bish, the Association of Licensed Multiple Retailers' (ALMR) chief executive, said the plan would "make no difference to pocket money prices on the high street nor the irresponsible retailing practices of Britain's supermarkets".

He added: "Today's announcement will make matters worse because it effectively legitimises the status quo and will see the price differential between pub and supermarket widen."

Instead the ALMR is calling for a ban on irresponsible promotions to be extended to the off-trade. The on-trade is banned from running irresponsible promotions under the mandatory code, but shops and supermarkets were not included in the clampdown.

"We simply want a level playing field and the ban on irresponsible promotions extended to anyone who sells alcohol," said Bish.

"That would make a material difference to pricing and commercial behaviour."

Mark Hunter, chief executive of Molson Coors UK & Ireland, said the plan would not address the problem and could legitimise driving prices even lower.

He added: "We believe that a ban on below cost selling where a nominal cost is defined would address key policy issues, and be an effective, enforceable, easy to administer solution."

Brigid Simmonds, the British Beer & Pub Association's chief executive agreed with the government the plan would cut out the "worst cases" of off-trade discounting.

But she added: "It will not have a significant impact on low-priced alcohol in supermarkets. With 70 per cent of alcohol now sold in the off-trade, there is a real need for the government to do more to support the pub."

Meanwhile, Jeremy Beadles, chief executive of the Wine and Spirit Trade Association, welcomed the plans. "We have consistently argued for a ban on the sale of alcohol below the level of duty plus VAT on the basis that these are both consumer taxes and therefore the cost should be passed on to the consumer," he said.

"This is the practical way to implement this policy.

"It is important this policy is applied nationally. We are sure ministers will want to ensure it is not undermined by separate and different price initiatives by local authorities."