Economic Crime (Transparency and Enforcement) Bill

Debate between Baroness Smith of Basildon and Lord Clement-Jones

Committee stage
Monday 14th March 2022 Lords Chamber

[Lord Clement-Jones (LD)]

This amendment would provide limits on costs orders in relation to all civil recovery proceedings brought by an enforcement authority under Part 5 of the Proceeds of Crime Act 2002, which enables law enforcement authorities to recover property obtained through unlawful conduct without the evidentiary difficulties of securing a criminal conviction. The effective exercise of these powers is essential if civil recovery is to fulfil its purpose of deterring criminals who are as concerned, if not more concerned, with losing their assets than they are with losing their liberty.

The current costs regime for civil recovery is fragmented, with different rules applicable in different courts. I am very well aware that on the other side of the aisle are some of the experts in this area. Civil Procedure Rules apply in the High Court, the Court of Appeal and county courts. Rule 44.2 of the CPR sets out the general principles in civil proceedings that costs follow the result—that is, the winner pays the loser’s costs, but the court retains discretion to make a different order and determine the amount of costs to be paid. The principles relevant to the exercise of judicial discretion to award costs in civil proceedings in the Crown Court and magistrates’ courts have evolved over time through case law.

In civil proceedings brought by public authorities in the Crown Court and magistrates’ courts, the approach to costs is reflected in the so-called Perinpanathan principle. This includes civil recovery proceedings brought under Part 5 of the Proceeds of Crime Act 2002. In the Perinpanathan case, the Court of Appeal held that, where a public authority is unsuccessful in bringing an application, the default position or starting point is that no order for costs is made. However, a successful private party may be awarded costs if the conduct of the public authority justifies it. As a result, enforcement authorities will rarely have to pay costs when pursuing civil recovery in the magistrates’ court, but are exposed to significant costs in High Court proceedings, where the general rule is that the unsuccessful party pays the legal costs of the successful party.

Clauses 47 and 48 reflect a recognition that significant and deterring costs have made enforcement authorities reluctant to utilise unexplained wealth orders in their current iteration. Only nine UWOs, relating to four cases, have been obtained by the National Crime Agency since this investigative tool was introduced in January 2018. The unsuccessful UWO application in the Aliyev case, which I mentioned at Second Reading, left the NCA facing £1.5 million in legal costs.

Limiting the liability of enforcement authorities to pay costs in UWO proceedings is a welcome step, but it is a piecemeal intervention which does not address the chilling effect of adverse costs orders in civil recovery proceedings more broadly. This proposed amendment seeks to ensure consistency of approach in civil recovery proceedings so that adequate cost protections encourage enforcement authorities to put their economic crime-fighting tools to effective use. At present, the prospect of prohibitively expensive legal costs effectively renders certain assets out of the reach of underresourced law enforcement agencies. We need a new, consistent cost protection regime for law enforcement agencies and regulators under the Proceeds of Crime Act as a whole.

I am very grateful to Spotlight on Corruption for raising this issue and laying the grounds for this amendment. The starting point should be that a law enforcement body or regulator should not be ordered to pay costs where it is unsuccessful in bringing or defending civil proceedings. This would have the effect of each party bearing its own costs. However, the court should retain discretion to depart from this default rule in cases where there is good reason. This could include where the law enforcement body or regulator has acted unreasonably in bringing or defending proceedings and where the interests of justice and fairness would be offended, including where substantial financial hardship is likely to be suffered by the successful party if a costs order is not made.

I very much hope that the Government see the merits of Amendment 90 and of applying it in the same way to Scotland—the notice to oppose the Question that Clause 48 stand part of the Bill would have exactly that effect. I beg to move.

[Baroness Smith of Basildon (Lab)]

My Lords, I will be brief. I have listened very careful to the noble Lord, Lord Clement-Jones, and my understanding is that the Government are seeking to protect the enforcement bodies, such as the National Crime Agency, from the costs of legal action. Clearly, it is important to provide these agencies with an element of cover from being pursued for costs, as they must be free to investigate activities as they see fit and not fear the potential costs of bringing what they believe to be a legitimate case. As we have heard already tonight, the resources available to those being investigated is often hugely significant.

The noble Lord, Lord Clement-Jones, is proposing a much broader approach on this than in the government clauses, applying the principle to all civil recovery proceedings under Part 5 of the Proceeds of Crime Act 2002, not just to unexplained wealth orders. The Bill is quite narrow in scope, and the Government may not see fit to put this into this legislation, but I hope that there is an opportunity to debate this further. I would be grateful if the Minister could say something not just on whether it fits into this Bill but on the Government’s general approach to the issue.

Deregulation Bill

Debate between Baroness Smith of Basildon and Lord Clement-Jones

Thursday 6th November 2014 Grand Committee

[Baroness Smith of Basildon]

On my reading of the amendment that is not its intention. If the noble Lord wants to carry out a review of all licensing, I am very happy with that, but it is not the intention of the amendment. I am talking specifically about alcohol licences and the problems that are caused by the way in which they are operated. As I said, the application forms councils have to use are set out in regulations. This means that local authorities cannot combine forms so that a business can provide basic information once or even twice. Instead, businesses must complete this for each and every form required, overlapping and duplicating the information they provide. Councils tell us that they would like to have the freedom to remove this burden by combining and simplifying forms to cover just the information they need, thereby not placing undue burdens on businesses. Ending prescribed forms by regulation would enable that to happen without taking up parliamentary time. It is an easy thing for the Government to do by regulation. I always like to make things easy for the Government.

Individually, licensing regimes make sense and most of them continue to provide valuable safeguards. Typically, they have been brought in to tackle specific problems as they occur, which makes sense, as we have seen with the Scrap Metal Dealers Act. However, collectively, licensing regimes are a complex set of conflicting rules. The Licensing Act 2003 made an initial attempt to bring together multiple licences covering alcohol, entertainment and late-night refreshment under one Act. We want to take that further by rationalising and updating the legislation which is currently across at least five government departments. To give the Minister an example, I just referred to the Home Office and to the order I spoke to earlier this year, the draft Licensing Act 2003 (Mandatory Conditions) Order 2014. We have before us today a document on licensing from the Cabinet Office, and I was today given an impact assessment from the DCMS for yet another proposal to exempt regulating the provisions of the Licensing Act 2003.

That is very difficult for small and large businesses to manage and to cope with, but it can be simplified. That is a really easy thing to do, and does not cost any money. If we establish broad and consistent criteria for licensing schemes, we have to include transparency. There is also an issue around appeals and cost recovery processes. We need to enshrine the principle of joined-up related applications. That would simplify processes for businesses and councils and would also offer scope for improved safeguards for communities. Our proposal, which I believe is helpful to the Government—I thought I saw the Minister nodding at one point—is for a government-led review of local government licensing legislation, which would give the basis for a comprehensive licensing framework. We believe that that would help economic growth, and it would certainly help those businesses which have told us that they see a problem.

I turn to Amendment 75A, which is about making the licensing authority a relevant person. Clause 52 and Schedule 16 insert a new Part 5A into the Licensing Act 2003, to introduce a new procedure for authorising the sale of alcohol where the sale is ancillary to a community event or the provision of other goods or services. The clause and the schedule as a whole are sensible, and I am not going to oppose them. Currently, the requirement for obtaining a licence to sell alcohol is that it is sold on a commercial basis for profit. It is not to be given away freely or cheaply. However, we have some concerns around the unintended consequences of the new notices, including the potential costs to local authorities.

The new legislation outlines the prescribed fee, and we seek assurances that the fee will cover the cost to local authorities. Amendment 75A would make the licensing authority a relevant person. As the Bill is drafted, the licensing authority is responsible only for processing the applications. Objections to ancillary notices can be made only by the police or by council environmental health teams, not by the licensing authority. The licensing authority is the district council, the metropolitan London borough or unitary authority. That is the authority responsible for considering applications to sell alcohol and issuing a licence.

I am indebted to the Local Government Association, which supports Amendment 75A. I should declare that I am also one of its vice-presidents, as are many noble Lords. This mirrors a change made to the Licensing Act in 2012. When that change was introduced the Government said that licensing authorities were better able to respond quickly to the concerns of local residents and businesses by taking actions they considered appropriate to tackle irresponsible premises without having to wait for representations from other responsible authorities. We agreed at the time and we still agree with those reasons but we believe that they apply to all aspects of licensing. The Explanatory Notes on ancillary sales notices state that licensing authorities have the right to raise objections, but there is no wording to allow this. Expert legal advice confirmed that this power will not be available without an explicit reference in the legislation. Licensing authorities should be included on the list of relevant persons to ensure that they can raise local concerns about a notice if it is appropriate for them to do so.

My final amendments in this group, Amendments 75B, 75C, 75D and 75E, introduce a right of appeal to the licensing committee. This is really a streamlining process, because they introduce a right of appeal to the local licensing committee for applicants to use if their notice is refused because of an objection. That mirrors the Licensing Act regarding licensing committees whose judgment and applications are the subject of objections. Each licensing authority is required to establish a licensing committee that is formed of elected councillors, which will hold hearings and make decisions relating to licenses.

Local government prides itself on being the most open and transparent part of government and on being directly accountable to residents and businesses. It is worth noting that it also has the strictest rules regarding conflict of interests. I do not understand the reasons why, under the Government’s proposals, the only right of appeal against the decision not to grant a notice because of an objection is by judicial review. That seems a lengthy and expensive process, particularly when you take into account that applicants are prevented from reapplying for a licence for a period of 12 months. There is supposed to be a light-touch approach. Is that not hugely disproportionate and expensive for those businesses concerned?

I feel—and I am sure other noble Lords will probably accept this—that licensing processes within local government are pretty robust, but within any system objections can be raised with which applicants do not agree. Businesses should be able to appeal against objections they feel are unfair or do not take full account of their business proposal in a way that is straightforward and affordable. If we are insisting appeal has to be by judicial review, while that has to be part of any wider appeals process, it does not meet the criteria of being proportionate, straightforward and reasonable in cost.

We are not talking about a great deal of money here. Fewer than 5% of regular licences are refused. It is anticipated that it will be even lower for the new licences, so the financial impact on most applications would be negligible. It seems a bit OTT to have a judicial review process before any other appeal process is brought into play. I look forward to the Minister’s response. I beg to move.

[Lord Clement-Jones]

My Lords, perhaps I should not use the expression “happy hour” in this context, but we have spent many happy hours over the past few years debating licensing provisions. I have a bit of a horror of this clause, I must confess. The idea of this gargantuan review of what is effectively the amended Licensing Act 2003 seems to be vastly overengineering what is needed in this context. The reason I say that is that I remember pressing the Government nonstop between 2005 and 2010 on entertainment licensing, asking them to take a view about the way in which the Act worked for live music. Finally, rather than wait for a review, I had to put a Private Member’s Bill in and get that through before we got any further sense—luckily from this Government—on the wider scope of deregulation of entertainment more generally.

The idea that we are going to start digging up the plant by the roots at this stage, whether entertainment licensing, alcohol licensing or whatever, fills me full of horror. We have had debate after debate. We had a very long debate on the late night levy. We have got to let that bed in. I was not a great fan of some of that legislation, and I would very much like to see whether it is working. I suggest a rather more piecemeal approach to review. I am not against reviewing bits of the legislation, but this kind of vast superstructure of review over the whole of licensing in this area seems undesirable.

Licensing Act 2003 (Mandatory Licensing Conditions) Order 2014

Debate between Baroness Smith of Basildon and Lord Clement-Jones

Tuesday 25th March 2014 Lords Chamber

[Baroness Smith of Basildon (Lab)]

My Lords, I am grateful to the Minister for his explanation, and for his comments on the report of the Secondary Legislation Scrutiny Committee. I beg to move my Motion of Regret, which reads as an amendment to the Motion moved by the noble Lord.

I seek clarity from the Minister on the evidence he has produced and the information presented to your Lordships’ House in the Explanatory Memorandum and in the impact assessment. It seems to be a regular theme when looking at Home Office legislation—I feel that I come back to these three points again and again—that we need to probe further to understand: the evidence base for the measures brought before us; how those measures will work in practice and the impact they will have. That is, whether the measure can achieve the objective the Government state and any unintended consequences, such as whether groups or individuals other than those whom the policy targets are affected and whether that is reasonable. I have tabled this amendment to the Motion today because of the lack of clarity on these points in the order before us.

Most noble Lords would agree that alcohol can be both a pleasure and a pain. The vast majority of those who enjoy a beer or a glass of wine—or something stronger—do so responsibly, without causing any significant harm to themselves or others, and do not cause any disruption or drain on public services. However, we are also aware of those who, because of the amount of alcohol they consume, cause significant harm to themselves, and harm and disruption to others. That can be a considerable drain on public services, to the detriment of others. The challenge is to effect such change that will impact on the behaviour of those who have and cause significant problems, without unfairly impacting on responsible drinkers. The question for your Lordships’ House is whether the order before us today achieves those objectives.

I found the Secondary Legislation Scrutiny Committee’s 32nd report, and the 35th report with the publication of the correspondence from the Minister, Norman Baker, very helpful, and I was glad that the noble Lord referred to them briefly in this comments. The committee has proved—I have tried to follow this in reading the papers myself—the discrepancies and the contradictory information supplied by the Government in evidence for the policy. I am particularly grateful to the committee for its scrutiny, and I always find its reports particularly helpful and invaluable to your Lordships’ House.

After the committee’s initial scrutiny, the Government withdrew their original Explanatory Memorandum that claimed that the benefit to the public sector was £17 million a year from this policy and replaced it with the significantly more modest claim of less than £1 million —and I have to say that the evidence base for that £1 million remains a bit woolly. The 35th report published correspondence with the Minister, Norman Baker, with the initial questions and concerns of the committee. Having read the order, the Explanatory Memorandum, the impact assessment and the committee’s reports, I had anticipated a fuller response from Norman Baker. I share the concerns that the committee expressed in its 35th report, when it said:

“We found the letter to be no more convincing on the merits of this policy than the Explanatory Memorandum. The House may wish to press the Minister to explain the policy of the instrument more clearly in debate”.

That is the challenge for the Minister this evening: to explain that and to assist your Lordships’ House in understanding the rationale and impact of this, as well as bringing clarity to the evidence on the impact.

I am going to refer to parts of the Explanatory Memorandum and impact assessment as I make my comments. Page 2 of the impact assessment provides the Government’s assessment of the economic benefits of this policy. It identifies a best-estimate annual cost of £5.3 million and £9.5 million of benefits, giving a net annual benefit of £4.2 million. I am still a little puzzled by the figures. If the Minister has the impact assessment in front of him, he will see that the calculations of the costs in the figures include only two of the four costs listed; it does not include the cost to retailers. It says:

“There will be transition costs as retailers familiarise themselves with the policy … This is estimated to be a one-off total cost of £4.1m”.

Neither does it include,

“transition costs to the licensing authorities to familiarise themselves with the policy and inform alcohol retailers, estimated at £0.2m”.

Those costs do not seem to be included in the £5.3 million that the Government give as their best estimate of annual costs. But those are costs that the Government say will arise.

When we look to non-monetised costs and benefits, we see that there is more certainty around the costs than there is around the benefits, where it says:

“There may be a benefit to business if consumers”,

do such and such, such as “switch their expenditure”. So there is much more clarity about the costs than there is about the benefit, with the costs being referred to as “will” and the benefits as “may”.

Paragraph 10 of the Explanatory Memorandum is completely different, because the cost to business there is identified at around £0.4 million a year, with an estimated one-off cost as well. But it talks also about the impact on the public sector, saying:

“There is an estimated cost of £5.3 million per annum, plus £0.2 million implementation costs. There is an estimated benefit in reduction of healthcare costs of £1.15 million per annum. The benefit to society, for example to victims, the police and the criminal justice system through a reduction in alcohol related crime is estimated as £3.6m per annum”.

There is a net annual cost of £0.5 million—so that is different. But I do not know where the evidence is for the impact that is outlined in the impact assessment. The evidence base would be crucial on this, and if the Minister could enlighten us on the evidence base for those figures and why they are different in the impact assessment from the ones in the Explanatory Memorandum, I would find that helpful.

I have quoted from Norman Baker’s explanation in the committee’s 35th report. He explains the modelling used and offers,

“reassurance that work is in hand to improve the quality of checking Home Office Statutory Instruments and supporting documents”.

I still do not understand the reasons for the differences, but maybe I am missing something that is very obvious to others—I just do not know what it is, and other noble Lords may also find a lack of clarity there. If the Minister can give an explanation on points that I have raised regarding costs and benefits, that would be very helpful.

The second point is on the impact of the policy. What difference would this policy make? The rationale for the policy is outlined on page 7 of the impact assessment, which cites the NHS costs of £3.5 billion, alcohol-related crime at £11 billion and lost productivity due to alcohol at around £7.3 billion a year. That is £21.8 billion annually. It would be helpful to have the evidence base for that, because, again, those are significant costs. If they are likely to be reduced significantly, we would like to know the evidence base for that.

Page 3 of the impact assessment identifies the policies that were considered by the Government before bringing this policy forward. Originally, there was the minimum unit price, which qualifies what they used to call competition. The Home Secretary said previously:

“We will ... introduce a minimum unit price for alcohol”.—[Official Report, Commons, 23/3/12; col. 1071.]

There were no ifs, buts or maybes—she said, “We will introduce this”. The consultation document on the alcohol strategy stated:

“In the Strategy, the Government committed to introducing a minimum unit price. However, in other areas, this consultation seeks views on the introduction of policies”.

That seems to me very clear. The Government had intended, and were clear about that intention, to introduce minimum alcohol pricing, to the extent that they were consulting on other matters in the strategy and not that one. But tucked away on the impact assessment to the order, on page 3 we learn:

“The Government has decided that the introduction of minimum unit pricing (MUP) will remain a policy under consideration but will not be taken forward at the present time”.

That is not quite the same fanfare as when it was announced that it would be brought in. So that was rejected.

The other policy rejected was the ban on multi-buy offers, such as “buy two, get one free” in supermarkets. I am not clear how that works in conjunction with this order. Presumably, although multi-buys are not being offered, they would have to be sold in line with the formula in this order at a permitted price. I would like an explanation on how that works. I go to Marks & Spencer and buy my husband six bottles of Sussex Golden Ale for the price of five—that is a multi-buy. He is not going to get drunk on those; he is not a big drinker. He might have a couple of bottles of beer at the weekend, of an evening. But presumably that affects the price for those seeking to purchase such items on a budget. Although the Government do not seek to do anything around multi-buy offers, the permitted price would have an impact on such offers.

What about those pubs or restaurants that offer in many areas fish and chips and a pint for £4.99 or £5.99? Will that fall foul of this order, if somebody decides that the beer rather than the chips has been discounted on price? How would that be assessed? I would like to know the detail of how that will work, because we are told that this policy is the alternative to banning multi-buys and minimum unit pricing. What difference is it going to make?

The Minister quoted from the University of Sheffield School of Health and Related Research, which produced the data for the Government on the impact of the policy and the different income groups. There is recognition that those with an addiction are not likely to be affected by pricing; the greatest impact appears to be on those hazardous and harmful drinkers on lower incomes, as those on higher incomes could just spend less for the same effect.

Page 13 of the impact assessment explains further that there will be no change in expenditure for the higher-income moderate drinkers but there will be an increase for hazardous drinkers of 30 pence a year. It says that,

“whereas low-income harmful drinkers are expected to increase their expenditure by £1.40 per year, higher-income harmful drinkers are expected to decrease their expenditure by £0.10 per year”.

Is that really going to make any difference? The Minister gave some sort of figures on the differences that this policy is going to make, but I have not seen the evidence behind the information that he has given.

The response to the committee from the Home Office when it asked about the impact on crime—and the Minister gave significant figures on this—was:

“The reduction in crime costs was estimated by predicting how crime will change in response to changes in alcohol consumption. These estimates do not predict how the level of crime will respond to any changes in disposable income resulting from the ban on below cost sales. However, the prediction is that, on average, alcohol spending among low income groups will increase by 0.03%, equivalent to a £0.15 increase in annual spending. It is not likely that this would lead to any considerable increase in crime”.

We need more information about a significant impact in this regard. If we want to reduce harm, including harm from crime caused by drinking, will this pricing policy do it? How much less would someone drink as a result of this policy?

The Secondary Legislation Scrutiny Committee’s report states that the Sheffield model—the ScHARR model—

“assumes that on average each person will reduce their alcohol intake by 0.04%. The Committee asked what that meant in practical terms. The Home Office responded: ‘The reduction in consumption equates to an average three units per year per person that is equivalent to a large (250ml) glass of 12% ABV wine’”,

or two regular glasses, if, like me, you do not like the large glasses that some pubs use. Given that such minimal outcomes are listed in the report, the impact assessment and the Explanatory Memorandum, one has to question whether the measure will make the significant difference that the noble Lord claims that it will. It seems to me that there is not much evidence for that.

The impact assessment says that minimum unit pricing is still under consideration, but I understand that it may be affected by the Scottish legal challenge. Is this genuinely still under consultation—I think that the committee made a similar point in that regard—or is that just a phrase now being used as a graceful way of ditching the policy when it is difficult to say what the real position is, given the comments made by the Home Secretary and the Prime Minister?

These are worthy objectives. None of us wants to see harm caused to individuals or society through alcohol. I emphasise that most drinkers drink responsibly and drink gives them pleasure rather than causes them pain. The Government need to bring forward evidence to support their policy on these issues. I hope that the noble Lord will address these issues; otherwise, it seems to me that considerable effort and money have been expended to bring forward legislation that appears to have such a small effect.

Alcohol abuse is a serious issue and we all want to see policies brought forward to address it. However, I worry that the Government do not have a grip on this issue. We have had the hokey-cokey over the minimum unit pricing and the late night levy, which was supposed to bring in £16 million a year in the first year and £17 million in subsequent years. I think that that figure is now about £520,000. Not a single early morning restriction order has been put in place. The Police Reform and Social Responsibility Act included powers for the Home Secretary to introduce full cost recovery for alcohol licences. The Government say that they will implement those powers but have not done so although the Act dates from 2011. We now have the Government’s sobriety scheme to help those with alcohol problems. The pilots were launched in April 2012 and lasted for six months. I have no information on them but I understand that six people have benefited from the scheme.

If we are going to tackle this issue, we have to do so seriously and seek to have a joined-up approach on the different issues that can make an impact. However, I am not clear that the measure before us today will have any impact. If it will have an impact, where is the evidence base for that?

[Lord Clement-Jones (LD)]

My Lords, my noble friend will no doubt be relieved to hear that I will not ask as many questions as did the noble Baroness, Lady Smith. I think that we have perfect symmetry here because I wish to ask my noble friend why he is not going further today and why minimum unit pricing appears to be only half on the table.

The Government’s response to the consultation acknowledged that there might be unintended consequences of minimum unit pricing. This nostrum seems to be becoming increasingly prevalent. What process is now involved? We have this form of pricing, which clearly is half a loaf, but what is the Home Office doing in terms of further research? We have robust Canadian research, which many of us have seen over the past few months. I have the relevant brief in front of me. It states:

“All 10 Canadian provinces have some form of minimum alcohol pricing applied to liquor store and/or bar and restaurant sales … The Centre for Addictions Research of BC at the University of Victoria has collaborated with five other research agencies in Canada, USA and the UK to evaluate minimum pricing impacts on health and safety. Six studies have been conducted which demonstrate impacts of increased minimum prices on level of consumption and alcohol-related harms including deaths, hospital admissions and crimes. The results support the predictions of the Sheffield Alcohol Policy Model and suggest that estimated benefits are larger than the model predictions”.

It is interesting that all the Canadian evidence seems to imply that the Sheffield model is rather conservative in its estimate of the health and social benefits arising from minimum unit pricing.

It is interesting that the Government seem to have parked this matter. I very much hope that the Minister will describe what next steps will be taken to introduce something rather more robust than what we have before us today. How on earth will officials in the Home Office assess what the unintended consequences will be? It seems to me a very circular argument. There may be unintended consequences but surely, if the evidence appears robust, the way to deal with that is to go forward on a trial or sunset-clause basis, see what the impact is and then make adjustments accordingly rather than just talking about unspecified unintended consequences. I take the point about the Scottish legal challenge but that is a timing issue in terms of seeing whether or not that will bear fruit for the complainants.

I very much hope that the Minister will give us a little bit more of a window on the future as opposed to this rather cautious approach that we have at present.

[Lord Taylor of Holbeach]

My Lords, I welcome this debate. It is good to explain to the House how this measure fits in with the Government’s alcohol strategy, and the Motion tabled by the noble Baroness, Lady Smith of Basildon, has given us a chance to debate it more fully than we might otherwise have done.

I think all noble Lords agree that, when used responsibly, alcohol can be a welcome part of social situations and community events. However, we all also accept that alcohol-related harm can affect many people in England and Wales, with victims in almost half of violent crimes believing the perpetrator to be under the influence of alcohol. This is completely unacceptable. That is why the Government are committed to tackling this issue and why it is crucial that they use all the tools at their disposal to tackle the causes of this harm.



Through the alcohol strategy, the Government are promoting proportionate and targeted action to reduce the costs and problems caused to society by irresponsible and excessive drinking without disproportionately affecting responsible drinkers. This includes giving local areas more powers to address the alcohol-related problems that they face on a daily basis through the local alcohol action area scheme, which was launched last week. It offers support to local areas in cutting alcohol-related crime and disorder and reducing the damage caused to people’s health. As well as taking local action, we are acting nationally by challenging the alcohol industry to raise its game by supporting targeted local action, tackling the high strength or high volume products that can cause the most harm, promoting and displaying alcohol responsibly in shops, and improving education around drinking.

I think all noble Lords will agree that alcohol that is too cheap is a threat to achieving the aims of our strategy. We must do something about it without penalising those who choose to enjoy alcohol in a responsible manner and without threatening economic growth by creating red tape for business. The noble Baroness, Lady Smith, and my noble friend Lord Clement-Jones asked about minimum unit pricing. I would like to be clear that this is not a debate about the benefits of minimum unit pricing. However, I accept that it is a matter of great interest and will therefore speak briefly on it. A wide range of evidence was provided throughout the consultation on minimum unit pricing. These have been considered alongside updated modelling by the University of Sheffield—I note the comments of my noble friend on this point—which suggests that a minimum unit price of 45p would have an impact on the consumption of hazardous and harmful drinkers, thereby resulting in a significant reduction in health harms and some reduction in crime-related harms.

A number of other issues were raised, including the potential impact of minimum unit pricing on the cost of living, the economic impact of the policy and increases in illicit alcohol sales. The Government acknowledge the need to give careful consideration to any possible unintended consequence of minimum unit pricing. Further, while we remain confident of the legal basis of the minimum unit pricing policy and will continue to support the Scottish Government in this area, the Government are also mindful of the need to watch the outcome of the legal challenge to the Scottish Government’s minimum pricing legislation. For these reasons, the Government have decided that the introduction of a minimum unit price for alcohol will remain a policy under consideration. I emphasise to the noble Baroness that it remains a policy under consideration. It has not been shelved but will not be taken forward at present. We will continue to monitor carefully the legal developments and the implementation of this policy in Scotland.

Perhaps I may answer my noble friend Lord Clement-Jones’s comments about minimum unit pricing in Canada. Two provinces are actively engaged in this: British Columbia and Saskatchewan. They have been doing so for some time but their policies are different in practice from the proposals that have been made on MUP in England and Wales. Social reference pricing in Canada involves minimum prices for types of drinks but not per-unit pricing. The context of sale is also different. Alcohol sales are more tightly controlled in those provinces than is the case currently in England and Wales.

My noble friend also asked about the process for considering MUP. The policy remains under consideration, which includes looking at the experience of the policy in other jurisdictions and the potential unintended consequences. Officials remain focused on keeping this under review and will continue to do so, but it would not be appropriate to set a timescale for when this will be completed.

Perhaps I may address some of the questions asked by the noble Baroness, Lady Smith. It is easier to do so in the general rather than the specific, and I hope she will allow me to write to her on some of the specific challenges she made on the impact assessment and the Explanatory Memorandum. However, I should say that the impact assessment was approved by the Regulatory Policy Committee in 2013 and given a green rating. The benefits of the model have been based on the University of Sheffield’s ScHARR model and experts in a number of different fields have fed into the policy. While the reduction is modest compared with the size of the problem, this policy will impact the most on hazardous and harmful drinkers. That is why it is designed in this way. We know that those particular drinkers generate the biggest costs for alcohol-related harm. What this policy seeks to achieve is 900 fewer crimes in the first year alone. The reduction in hospital admissions will go from 100 in year one to 500 in year 10.

The noble Baroness asked for the evidence base for the cost of alcohol. NHS costs are based on Department of Health estimates and alcohol-related crimes are based on Home Office estimates.