Beer Duty Escalator

David Hamilton Excerpts

Thursday 1st November 2012 Commons Chamber

[Mr David Hamilton (Midlothian) (Lab)]

I will try not to take up too much time. I want to be specific, because it appears from the interventions on the hon. Member for Burton (Andrew Griffiths) that hon. Members have a wide range of opinions that all go in the same direction. They will give the facts and figures during the debate.

When I was a young man, there were 23 pubs in Dalkeith high street. Times have changed. The price of alcohol has created problems for the brewing industry, but so have changes in habits and priorities. There is no doubt that taxation is one of the many factors that have created a problem for our pubs. Every day, we see on television and in the newspapers the problems on high streets at weekends, but no one talks about the thousands of pubs in villages and housing estates where there are no problems whatever. We want to protect those pubs.

No doubt the Minister will say that treating alcohol-related diseases costs 3% of the NHS budget; that only £10.6 billion is raised in tax; and that £21 billion is spent through the NHS on treating alcohol-related injuries and so on. I understand that, but I have a specific point for him to consider. Many hon. Members will talk about draught beer and cider, which are disproportionately affected by what happens in the supermarkets. In Scotland, there will be a threshold for alcohol pricing in supermarkets, but a minimum pricing regime will mean that the supermarkets take the money—nobody else will get it. Will the Treasury consider transferring the duty, and reducing the tax on some products and increasing it on others?

If hon. Members go to Tesco across the road from the Palace, they will find that four cans of John Smith’s will cost them £3.50—so I am told. A pint of the same beer will cost them £4.10 in The Red Lion. The tax on alcohol in supermarkets is completely disproportionate to the tax on alcohol bought at the bar.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

The hon. Gentleman makes a serious point about the health impact of alcohol on our society. Does he agree that pubs are a more controlled environment for drinking, and that people are less likely to abuse alcohol in pubs than if they buy cheap booze from the supermarket?

[Mr Hamilton]

I could not agree more. As a side issue, the central location of television soap operas is the pub. Things might be exaggerated on television, but pubs are about families and people getting together. Pubs are controlled environments where people look after one another. It is not uncommon for the bar steward to say to someone who is too drunk, “You’ve had enough. Away you go.” Somebody might look after someone who is too drunk in the pub. Drinking at home is uncontrolled and causes far more bother. Another problem we must face is that, nowadays, people—youngsters especially—meet in houses and get drink-fuelled before going out to the nightclubs.

[Mr Jim Cunningham]

Does my hon. Friend agree that one big problem with our high streets is the fact that there have been a lot of pub closures? Working men’s clubs are also affected. Are they not contributing factors to why we have ghost city centres, as we call them these days? A commission is looking into that.

[Mr Hamilton]

It is also the case that it is not just about pubs and the price of beer. Pubs, and especially clubs, have a far wider role. My local club, the Dalkeith miners club, has about 25 different organisations, including ones for kids, using its big halls during the day, and it is looking at other avenues. In many cases, clubs are community centres where no other community centre exists. They become the focal point for everyone.

I know that other hon. Members will raise a host of issues, but I have a specific point I wish to make. Surely it is not beyond the wit of the civil servants in the Department to come up with a mechanism that would tax a 50-pint cask of beer differently from anything else. That would allow draught beers to be taxed at a different rate—nobody is going to go to Tesco and buy a 50-pint cask and carry it home. Draught beers, ciders and lagers could be taxed differently.

[Mr Leech]

Is not the easy solution a differential on beer duty as between off-sales and on-sales? Minimum pricing for alcohol in supermarkets is still going to make supermarket alcohol much cheaper than in the pubs. If there is a massive differential in duty between supermarket alcohol and on-sales, it would make a massive difference in terms of encouraging people to drink in the pub instead of front-loading from the supermarket.

[Mr Hamilton]

I agree with the hon. Gentleman’s point, but without a cross-subsidy—the money raised from one being transferred to the other—I would be reluctant to go down the road of minimum pricing as proposed by the Scottish Government. Nobody has yet told me where that extra money will go, and that is a really big question that has to be answered. It has to be taken on board by the Department.

On the wider issue of alcohol taxation, it is a fact that the tax nowadays is so draconian compared with many years ago that it is a case of beer drinkers subsidising tax revenues. That has to stop, and the European Commission has to be drawn into line. I believe strongly that there is an alternative to the present proposal of cutting tax across the board. A selective cut could be effective. There have been many campaigns on beer, cider and lager, but there is an easier method if the tax is considered in terms of barrels of beer. It would have to be cleared through Europe, but the civil servants could do it.