Dylan Reeve blogs on Labour's proposal to legislate the price of alcohol:
Labour has announced that it intends to seek to amend the Alcohol Law Reform Bill to allow for minimum pricing to be enforced. This was something that featured in Labour's policy before the election (although it wasn't a bullet point they ever brought up). There's no indication of how Labour would implement the idea or what the cost implications would be.
The problem that this will supposedly address is related to binge drinking and alcohol related disorder in NZ. The idea being that people (young people) are "pre-loading" on cheap booze before going into town. The simplistic solution then? Make booze more expensive.
The scapegoats in this argument are usually either "alcopops" (premixed drinks) and discount wine (usually from supermarkets). By imposing minimum pricing, the argument goes, you increase the cost and thus decrease the appeal and availability of those type of drinking.
This, like Labour's GST-free fruit and vege policy, is short-sighted and unoriginal. They are taking aim at very simple parts of very complex issues and attempting to attack them in broad and blunt way.
Whilst we are sure that the preponderance of cheap spirits and RTD's is a factor in teenage binge drinking, we agree with Mr Reeve that Labour's approach to this issue is simplistic. It seem to be policy made on the hoof, and that's generally bad policy.
Reeve continues:
So far we have only two clues really about what Labour might be imagining for this law. The first is a quote today from Labour's Charles Chauvel, "If instead of being able to buy a bottle of cheap wine for $6 from the supermarket, a minimum pricing regime puts that up to 12, 13 or 14 dollars then it's much harder people to lay their hands on cheap booze."
The second is a ballpark figure tossed around by Lianne Dalziel in discussion of alcohol law reform late last year where she mentioned "$2 per standard drink" - this would possibly line up with Chauvel's estimate as a bottle of wine is usually between 6 and 8 standard drinks.
But the whole idea seems fatally flawed really. We're talking about people who are presumably getting drink then heading into town and buying a few drinks while out. Is the price rise going to stop them? They'll still buy the cheapest booze and it's not going to cost a lot more. Assuming that 6-8 drinks is enough to get you happily drunk then we're looking at only $12-16 which isn't much compared to the $5-10 per drink you'd expect to pay in a bar. Sure, it's more than the maybe $6-10 to get drunk now, but it's hardly the sort of price hike that'll change behaviour.
Instead the people who suffer are the rest of us who buy wine, beer and spirits to enjoy responsibly. Chances are we're not buying the cheapest products on the shelf now, but if the bottom shelf goes up in price then it seems certain that rest of the market will trend upward too. After all, if a budget bottle of wine is $7 now, but will be $14 in the future, then the mid-range $15 bottle is hardly going to stay that price.
This flaw is precisely the same as the major flaw in Labour's desire to see the minimum wage rise to $15 per hour. It would be sustainable if it was only going to apply to workers on the minimum wage, but of course it won't. There are margins between different jobs for good reason; people are paid what they are deemed to be worth to the company that employs them.
If we employed staff on the minimum wage (we don't; most of our 40-plus staff earn way more than that) and we were mandated to give them a 15% increase, we would have a moral obligation to apply that increase right up the food chain. And for our business, an immediate increase of $150,000 per annum in salaries and wages would be unsustainable, so we would probably have to find a way to do without two or three staff members. Who wins there?
Labour's suggestion is far too simplistic to get off the ground. In fact it's so simplistic that we wonder why someone in Labour's brains trust hasn't spotted the fatal flaw that Dylan Reeve refers to, and thrown the policy papers in the shredder.
Surely Labour can come up with a more cogent policy than this. Surely?
15 comments:
If making booze dearer is the answer it is a bloody stupid question.
"...we would have a moral obligation to apply that increase right up the food chain..."
BS, KS. You have DECIDED it is a moral obligation. It is greed, tradition, and conservative right wing politics and economics that makes this your wont. I happily work for less than I'm 'entitled' even though I'm highly skilled and qualified so my fellow less qualified colleague can take home a decent pay. I still have more than enough to live on and enjoy choices in life. I'd be happy if he got a pay rise, while I did not, based on the fact that I have enough and he sometimes struggles to make ends meet. It's not about pie in the sky equality. It's about doing the small things that can be done to iron out the MASSIVE inequalities. The gap is too large. And it's been made large by people who seem to think everyone needs more. That's not true. Only some people need more. During the good times, I'll take a pay rise too. Your argument is an ideological impractical head in the sand one. I'd have thought you were smarter and had sounder morals than that.
Labour and the Lefties are just a bunch of bloody control freaks. Our rights and liberties are being constantly eroded by these idiots who claim the higher moral ground and then seem to think that it is their duty to legislate to make sure that the masses are hammered into submission and subservience. My comments to Chauvel and his Socialist cronies are get the hell out of my life and stop trying to tax me out of existence. Once again the many are being punished because of the actions of a few. Also pray tell what will they do with the extra money gained. That's right give it to the Beneficiaries so that they can afford to pay the higher prices on alcohol, so the problem will continue.
You, Allan, like JK and KS are obviously financially illiterate. If al-key-hol is your drug of choice good on ya. Prefer the RTDs and shit cheap wine that is peddled at the kids do ya? Raise the cost of the lower grade crap and the better quality, better class grog can stay put. Then adults can continue to enjoy a tipple if they save up to pickle themselves. False economics to suggest the whole gamut has to go kaput! God loves a trier!
Allan
I'm wondering if you've been asleep for the past 4 years. National is the Government now. All of those rights and liberties you are losing are being taken from you by John Key and the National Party. Wake up man, for God's sake! Use you eyes!
Whilst we are sure that the preponderance of cheap spirits and RTD's is a factor in teenage binge drinking
Hogwash!
Drinking on a weekend night was in full swing when I was a young fellow (We used to share the stuff with the dinosaurs), we just didn't have totally wet tossers wanking off whenever we reached for the sherry, port, Oravino, Velluto Rosso, screwdriver, Gimlet, Bacardi and Coke, cheap whiskey, whisky, rum, gin, vodka, or whatever booze we could get our hands on at the time.
This is just another attempt by communist (or wanna-be communists eh bOb?) to tell people what to do, that they know best.
@ Henry - I wasn't referring to my wife and my salaries. But if the office junior's pay goes up by $1.50 an hour, isn't the accounts clerk going to expert her pay to rise as well, and likewise the office manager?
We regard ourselves as "good employers"; we pay well, we try to provide good working conditions and interesting, stimulating work. But we simply cannot afford an across-the-board 15% wage increase in the current economic environment. And that would be the ultimate outcome of a 15% increase to the minimum wage.
This has nothing to do with "greed, tradition, and conservative right wing politics and economics"; it's a plain, simple statement of fact
@ RT Dee, Pork Pie and Gwen; deleted; read the rules.
Wasn't referring to you or your wife. I'm not a business owner. I'm a worker. But would not take a pay increase just because the minimum wage went up. Im not sure why you assume you have to increase across the board. That's all rather socialist isn't it? As I say. I' need no extra. But some of my colleagues do. How can you deny them that based on your personal beliefs which impose it upon them? If you are not being obtuse then It's Hypocritical.
Henry; I wasn't being obtuse at all, or hypocritical for that matter. All our staff earn more than the minimum wage, and many earn significantly more; that has been our choice. But we also pay on the basis of the value that individual staff add to our business. But if suddenly the starting point for a pay scale changes from $13.50 to $15.00 (or nearer $18.00, if the Greens' "living wage" policy was ever implemented) then everyone else's wages would have to rise as well.
Say for example we had an office junior currently earning $15.50/hr; would she be happy if we didn't increase her pay to at least $17/hour to protect the $2/hour margin? And would the accounts clerk on $17.50 be happy if the junior was suddenly earning $17/hour, and we didn't give HER a corresponding pay rise?
We care about fairness too Henry. But given that private businesses earn far more people than the government does, it's blatantly unfair for the state, by the stroke of a pen to order business owners to pay a wage rate that they cannot afford in the current environment. That will likely mean that many businesses will downsize, there will be more people out of work, and the tax take drops. Who is the winner then?
Anyway, we may have to agree to disagree, as we are getting well off-topic!
The government has throughout history tried to tell people what to do. I grow my own tobbacco and it looks like I will be brewing my own soon. All these idiots do when they pull this nonsense is miss out on taxes. Oh well, saves me a few bucks!
People, don't judge it too seriously. Everyone has a free mind and can decide on his or her own. Politics, well, they always do what they do. Calm down.
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