Alcohol pricing and loss leaders
Senator Mulherin objected to heavily discounted supermarket alcohol sales during Alcohol Awareness Week, and Senator Noone backed tighter rules on below-cost selling and loss-leading promotions.
This week is alcohol awareness week on an EU-wide basis. We spent many hours last week discussing the issue of binge drinking and alcohol abuse, and the terrible consequences of this for society. Last Sunday, an advertisement was placed in the Sunday Independent by one of Ireland's multiple retailers advertising the sale of 24 500 ml cans of Bulmers cider for €25. The cost to a publican in respect of the purchase of 24 cans of cider from C&C Gleeson, which owns Bulmers, is €39.89, plus VAT at 23%, bringing the total cost to approximately €49. What is indicated in the advertisement mentioned is below-cost selling. The advertisement also referenced Heineken and Guinness. This offer is also available online.
I do not propose to name the retailer because it does not need any help getting people through its doors to purchase below-cost alcohol. This is practically selling alcohol wholesale. We have been told by the experts that there is a direct correlation between the cost of a unit of alcohol and abuse of alcohol and that people who are abusing alcohol are more likely to buy cheap alcohol.
The Department of Health officials have been charged with finding a workable solution to accommodate small shops under the Public Health (Alcohol) Bill. We need to bear in mind where the real problem lies. How can the small shop or publican ever hope to compete with what the large multiples are doing? They cannot compete with it. For the multiples, below-cost selling is a means of getting customers through their doors because they collect their profits elsewhere. They will not incur any loss and ultimately they reclaim the VAT on the sales of such alcohol from the State. There is something seriously wrong with that. We have a very welcome provision in regard to minimum unit pricing in the Public Health (Alcohol) Bill. We need to stop below-cost selling for the sake of the health of our nation and for the sake of the small businesses and publicans who are selling responsibly and have a good track record. This is a reality check as we debate this important Bill.
Comment on this
I agree with Senator Mulherin's comments in which she articulated the nub of the issue very well. It is the multiples that are happy with the Public Health (Alcohol) Bill and for good reason. The fact that the Minister is willing to compromise in regard to the lower percentage of sales is to be welcomed. These loss-leaders, which is effectively what they are, are drawing people in. They are treating alcohol like any other grocery in order to bring people into their stores. This is absolutely ludicrous.
I also welcome Senator Craughwell's comments on social media. As politicians, we need to stand up to that type of activity. In regard to the consultants, it is important that we bring some balance to bear in that debate. There are compliance and other issues that need to be addressed. This is a minority group. We need a balanced debate and should not get carried away in that regard. The majority of consultants are hard-working and committed to public service. This should be borne in mind during debate of the issue. As I said, this is about a minority group. I am not excusing that minority rather I am asking that we remain mindful that many consultants are hard-working.