Floor Pricing for Alcohol

A journalist whose views I usually respect today derided calls for an increase in the minimum price of alcohol as coming from the “killjoy” crowd, who “do not even attempt to … estimate the value of the pleasure given by alcohol to the vast majority of Australians who do not abuse it.”

This is balderdash. As with gambling, the problem is not with what the vast majority of Australians do, but with the problematic excesses of a few. In the case of alcohol, it is the problem of those who purchase litres of cask wine at 30c per standard drink and proceed to destroy their health and lives. Prevalently, these are people of lower socio-economic status, especially Aborigines. Coles, Woolworth, and IGA have already almost quadrupled this minimum price in Alice Springs by selling alcohol at no less than $1.14 per standard drink, without affecting the prices of beer, spirits, better wines, etc – the stuff the vast majority of Australians actually drink.

The Henry Review suggested that the final rate of volumetric tax should “be intended solely to optimise price signals facing consumers. It should be set without regard to the government’s fiscal position, and irrespective of any specific spending commitments related to alcohol abuse” (Australia’s Future Tax System, Chapter E5-3, 2010).

Floor pricing for alcohol is a sensible health proposal that deserves support, not to be dismissed out of hand as coming from the “killjoy” crowd.