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WRITER, CONSULTANT AND BROADCASTER SPECIALISING IN BEER, PUBS AND CIDER. BEER WRITER OF THE YEAR 2009 AND 2012

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Thursday, 14 January 2010

Answering the neo-prohibitionists, 9 of 10: "Pubs are a problem"

This post is a little different from the others, in that the HSC report doesn’t really attack pubs implicitly. In fact, it suggests that minimum pricing would help traditional pubs at the expense of off-licences. Some commenters have suggested this is a cynical ploy to divide the pro-drinks lobby. I won’t give my thoughts on that here.

But while the HSC lets pubs off the hook on the surface, there are two reasons to keep defence of pubs to the fore.

The first is that the HSC report recommends the urgent introduction of the Mandatory Code for pubs. As well as suggesting bans on happy hour type promotions – which many responsible drinkers would at least sympathise with – it contains more worrying proposals such as the introduction of CCTV in pubs, and a broader role for police in pubs. At best, the Code means more red tape for licensees and a huge administrative cost to implement, when many landlords are already on their knees. At worst, it could fundamentally change the unique character of the British pub. Further ideas that have been discussed (though to the best of my knowledge, not seriously proposed) include:

  • Limiting live music in pubs to be no louder than the volume of a hairdryer
  • Having two police officers stationed inside the door of busy pubs – with the publican having to pay for them
  • Insisting that every drink must be poured in a legally approved measure so people know exactly how much they’ve had to drink – which would make it illegal to top up a new glass from an open bottle, for example.
  • Insisting that some pubs use plastic glasses at all times

The anti-alcohol lobby will continue to suggest proposals such as these in its fight against the pub, so its important that we defend the pub against them.

Secondly, the broader anti-alcohol lobby regularly has pubs in its sights. Most pictures illustrating binge drinking stories in newspapers and illustrated with pictures of pubs. Attacks on “24 hour drinking” invariably suggest that pubs are open all night.

While most alcohol consumed in the UK is now bought off-trade, the pub is still the symbolic home of the drinker. Eric Ilsley MP told the SIBA conference in 2008 about a Radio 4 story focusing on children as young as ten being admitted to hospital with drink related problems.When the interviewer asked the health expert what could be done about this, the ‘expert’ replied, “Well, we’ve got to get tougher with pubs,” as if children of ten were happily nursing pints at the bar.

So while some progress is being in advancing the image of the pub, it is still a scapegoat in the eyes of right-wing tabloids at least. This series of posts is intended to provide ammunition to combat all the usual attacks on the beer and pub industry – not just the HSC report – so I wanted to include the following data here.

24 hour licensing – the truth

“24 hour drinking” is a myth that has become true by simple repetition in the media. So here are the facts.


The number of 24 hour licences issued so far is 7178. Of these, 22% have gone to supermarkets, the rest 5600 – to the on-trade. There are 105,000 on-licensed premises in the UK, which means that 5.3% of UK on-licences have 24 hour licences.

The vast majority of these have gone to hotel bars, chiefly top clear up the ambiguity around staying open late to serve hotel guests. Only 12% - or 861 licences – have gone to pubs, clubs and bars. A tiny, fraction of pubs have 24 hour licences.

The truth of “24 hour drinking is, according to a review by the Department of Health, that pubs on average stay open a while 27 minutes later than they used to.

The image painted in the media of pubs servoing drunks around the clock is a complete fabrication.

On versus off-trade

Not all of you are going to like or agree with this, but it’s a point that has to be made – and it’s a point on which I agree with the HSC!

I’m not arguing that supermarkets are entirely to blame for the drinking problem that does exist in the UK (whatever the true size of that problem may be). And I’m not necessarily arguing in favour of minimum pricing.

But I would argue that it is wrong to sell alcohol below cost price. Several bloggers have been angered by the whole “alcohol cheaper than water” claim, but I’ve seen the documents that show this has on occasion happened.

And whatever your views on that, it’s simple to calculate the total VAT and Customs & Excise duty on a given container of alcohol. It is common to see booze sold in supermarkets for less than this amount. I’m sorry, but selling below cost price strikes me as irresponsible.

But the main point I want to make is one of principle, not price. In their evidence to the HSC, representatives of big supermarket chains repeated the line they always used when questioned on the ethics of selling alcohol below cost price:

Sandra Gidley: Why do supermarkets sell alcohol at below the cost of the duty that is on it from time to time as a loss leader?

Mr Kelly: As we said earlier, we are in a highly competitive market competing for customers and we will sell sometimes loss leaders across a whole range.

Sandra Gidley: Do you think it is right to do this with alcohol though? Do you think it is socially responsible?

Mr Kelly: We are in a highly competitive market.

I’m bringing this up, remember, to defend pubs. Supermarkets are doing remarkably well, taking an ever-increasing share of British total expenditure. Pubs are closing at a rate of 52 a week. If anyone knows what a competitive market is, it’s the publican.

But just imagine if a Publican, or even a big PubCo, did a promotion of shots for 30p and when questioned on the morality of it, shrugged and replied, “We’re in a competitive market.” They simply wouldn’t be allowed to get away with it. But supermarkets are.

I’m not saying the carnage in the pub market is all the supermarket’s fault. I’m unhappy at having to write something potentially divisive in this series of posts. But alcohol is an intoxicating drug and I believe anyone who sells it has a duty of care to their customers to recognise that and act upon it. Supermarkets do not. Pubs – not all pubs, but the vast majority – do recognise this.

So in summary, there are two points to this post really:

  • Pubs are responsible retailers of alcohol and are often unfairly demonized. The myth of “24 hour drinking” is a classic example of this.
  • Supermarkets need to publicly acknowledge the ethical responsibility that comes with selling alcohol. By simply justifying their behaviour with regard to price they are failing to do so. This does a grave disservice to the entire alcohol industry, and opens everyone up for attack.

I’m all for working together and uniting the industry with one voice, as these posts hopefully suggest. But this requires an acknowledgement of the responsibilities the industry has.

13 comments:

Sid Boggle said...

Excellent stuff, Pete. Is there any evidence that brewers are incentivising retailers to loss-lead their product? It'd be interesting to know where and how these decisions are made...

Velky Al said...

At the end of the day though, for supermarkets alcohol sales are simply one revenue stream among many, whereas for the publican, it is usually the leading revenue stream, if not the only one.

Perhaps a solution would be to prohibit alcohol sales through supermarkets and only off-licenses and pubs to sell alcohol?

I am not saying I necessarily approve of this, but it would take alcohol out the hands of supermarket chains that can consistently undercut the smaller business purely through their purchasing power, and the fact that they make sufficient money elsewhere to make up for losses on alcohol.

In taking alcohol out of the hands of supermarkets, and putting it in the hand of companies for whom it would be the main revenue stream, you are more likely to increase the sense of a duty of care of behalf of the retailer to the customer.

It might also see an increase in small businesses selling alcohol, giving more outlets for the smaller breweries.

Just a thought.

BLTP said...

This responsible vendor thing is interesting. I've been drinking in pubs for 22 years I can barely remember an occasion when someone has been refused service because they too far gone. I've seen people turned away from clubs/pubs held up by their mates and drunks slung out of pubs for being a sleep/unconcious. But I've rarely seen people told they've had enough and not been served at the bar.
I'm sure people will say they do it all the time but as a punter I've not noticed it.

Rob said...

'I’m all for working together and uniting the industry with one voice'

Im with you on that one Pete.

Curmudgeon said...

Perhaps a solution would be to prohibit alcohol sales through supermarkets and only off-licenses and pubs to sell alcohol?

Surely all that would lead to is the Tesco off-licence next to the Tesco supermarket.

Curmudgeon said...

We shouldn't be too sentimental about pubs. Yes, well-run pubs are all the things you say, and they're the kind of pubs all of us tend to drink in. But the fact remains that many town-centre premises are not well-run and actively encourage irresponsible drinking. It is also the case that the vast majority of alcohol-related disorder is associated with drinking on licensed premises.

A guy may steadily wreck his liver by drinking six cans of Stella every night at home, but he's not out there causing trouble on the streets.

(I think I posted this on the wrong topic earlier this evening)

Ian S said...

Pete, re the number of pubs with 24-hour licenses, I understand many of these are in areas where the council chose to make all licenses 24-hour to reduce admin costs when hours needed to be changed. One example of this is North Walsham in Norfolk.

I would be surprised if there were any pubs actually trading 24-hours, other than special situations like airports.

Good series of articles btw!

Woolpack Dave said...

Yes, indeed the 24 hour thing is a complete red herring. Many publicans I know have licensees that permit them to open until 1am perhaps, but they choose to close at 11pm most days. It's just easier to have blanket licensing to help with the occasional late night.

BLTP, I have indeed refused service to a few people, but I don't have to do it that often before word gets around that it's not permitted in my gaff. Licensees who break the law by permitting people to drink to unconsciousness are part of the problem. However, we do not need new laws we just need to prosecute unlawful behaviour.

Pete, I'd be interested in knowing an example where alcohol is truly sold below cost. Every time I've looked at examples they are still being sold above the duty+VAT rate, even if only by a small amount. However, the availability and low price of alcohol in supermarkets has to have had an effect on pubs, the problem is how do you realistically reverse that? I'm not convinced minimum pricing is the solution.

Andrew said...

My experience with supermarkets (as a reporter and editor on trade magazines rather than a punter) suggests that brewers have very little say in what supermarkets do with their products. Many promotions are actually partially funded by the brewers. So in effect they are paying to sell their beer, the payoff of course is a higher volume.

Anonymous said...

Relates more to your earlier posts but I pulled this briefing entitled 'Too much of the hard stuff:what alcohol costs the NHS'
off the nhs confederation website:

http://www.nhsconfed.org/Publications/Documents/Briefing_193_Alcohol_costs_the_NHS.pdf

Particularly like the bullet points at the top of page 2. The correlation/causation argument raises it ugly head again!

BLTP said...

woolpack dave I was just passing on my anecdotal observation. I wasn't suggesting new laws far from it. Many of the London pubs I drink in are manned by staff not the licencee and so they go by to some extent the anything for a quiet life principal. The one occasion recently when a drunk was thrown out was by the landlady so maybe more licensees should follow yours and others lead and be more proactive. The loss of few half drunk pints to already smashed punters is worth having an industry to contiune working in. Also most of the time your full on drunks are resented by the rest of the pub who just want a few quiet pints not to have to put up some badly written eastenders episode.

NeilC said...

Brewers can not always control the price of their products. We supply Tesco's and said we would not discount on a premium product,Then they discounted our product in a beer festival at their cost. As a supplier what can you do?

David said...

Pete, but isn't the difference that in a pub people are actually drinking then and there, and so, for example, free grog will result in them getting too pissed? In a supermarket though, if someone gets a special on a 6 pack and it's a loss leader then good on them. Long live competition, and responsible service does not really apply to supermarkets.