Alcohol Reform Bill

We now come to Part 6. This is debate on clauses 285 through to 399, and it includes schedules 1 through to 3.

I rise to speak to this Part 6, in particular clause 383. In that respect, the Supplementary Order Paper that stands in my own name, which is Supplementary Order Paper 112, would amend clause 382. I just want to correct that I am talking about clause 382, and my Supplementary Order Paper on that is 112. My Supplementary Order Paper is quite straightforward. It is quite a simple measure, and, again, as with every other speech I have made in this Chamber on this piece of legislation, it has a health focus. It imposes a health levy—in other words, a tax. Indeed, it is a tax, but not an excise tax that is levied on sale but sheeted back home to the producers more often than not. In this case, it is a levy that is gathered at point of sale. In other words, it is an impost on consumers, and it is in regulation form. In other words, it is at the discretion of the Minister, who could levy this health levy as and when required, using what the Law Commission recommended, which was price as a deterrent against heavy alcohol consumption.

The most obvious use of this health levy would be for a Minister to declare that a certain amount of money would be added to the price of a particular product line at the point of sale for off-licences. This would apply only at off-licences; not on on-licence premises, like restaurants, or cafes, or bars, but off-licence premises—wholesalers, supermarkets, bottle stores, and so on, as we are familiar with. This levy could be extracted at the point of sale, it would be an impost on the consumer, and the Minister could apply it to, for example, RTDs—ready-to-drink products. I personally consider those to be the most flagrant attempt of the alcohol industry to lure young people by disguising what is otherwise the bitter flavour of alcohol, and an acquired taste, as a sweet drink that can be attractive to young people. In other words, it is getting young people hooked on consuming quantities of alcohol without really appreciating the fact that they are doing so.

The point of this levy being exercised at point of sale is that it would have the deterrent effect of, in some respects, minimum pricing, but that deterrent effect could be applied to particular product lines for a certain length of time. I also support my colleague Phil Goff’s Supplementary Order Paper, when it comes to ready-to-drink products. But this one has two notable features that I think are worth speaking to.

The first is that this levy is ring-fenced. It is pegged to go back to the health sector; not to go into the consolidated fund, not to go back to the alcohol industry, but to go into the provision of health services arising from excessive consumption and abuse of alcohol. That is why it is called a health levy. It would be targeted for a particular purpose to a particular product for a certain length of time. If it became apparent that there were other products, if, say, the Minister decided to exercise this health levy on ready-to-drinks, and another product line emerged over time that had become fashionable for young people, for example, to consume in harmful quantities—because that is the primary driver or rationale for this Supplementary Order Paper—the Minister could then apply another levy to another product line for an alternative length of time.

So this Supplementary Order Paper has these two notable features that others do not have. One is that it can be applied flexibly to a range of product lines, and the other is that the proceeds from it would go back into, and be tagged for, the provision of health services for those who have problems arising from alcoholism or the excessive use or abuse of alcohol. This is fairly straightforward. It is a health levy at point of sale. It would be established by regulation, and therefore would not need to come back to the House on a regular basis. It could be done by regulation and come to the scrutiny of the Regulations Review Committee. It could be used variably across a range of products so that it could specifically target certain products, such as the one I have suggested, ready-to-drink beverages, or spirits, beer, wine, or other alcoholic beverages, according to their proven and demonstrable harmful effects.

One of the things that I keep coming back to is that the Law Commission did not make its recommendations in a vacuum. I am still disappointed that this Government has not taken up some of the forceful recommendations of the Law Commission, because, as I read it, the Law Commission arrived at its recommendations on the basis of evidence.

This health levy is also predicated on the basis of any new evidence that might emerge in the future that would single out and target particular alcohol products as being harmful—harmful because they are fashionable, harmful because they are marketed in a particularly deceptive way to young people, harmful because they are disguised, harmful because they are more readily accessible than other products, or for whatever reason that they might cause harm. The underlying reason for this Supplementary Order Paper is to avoid harm, to minimise harm, and, where harm has been proven to occur, to ensure that the proceeds from the health levy be applied back into the problem health areas. So its application to health problems arising from abuse of alcohol will in fact address one of the Law Commission’s recommendations in this regard.

The establishment of a point-of-sale health levy only for off-licence premises is also a mechanism that can stop heavy discounting possibly to below cost. It can be used to prevent that loss-leading scenario that happens in off-licences, such as supermarkets. It would also have a very limited effect on those who drink safely and responsibly. If a favourite product is subject to this levy, then people who drink safely and responsibly are not going to be consuming it in such quantities that they feel a huge impact from the levy. But where it is purchased and consumed in excess, and in large quantities, there will be a deterrent effect.

This Supplementary Order Paper combines the deterrent effect of additional price mechanisms, without that being sheeted back home to producers, such as wine growers. It applies that levy to health remedies and services for those suffering from the effects of alcohol abuse. This is a Supplementary Order Paper that is worthy of consideration. I would appeal once more to the Minister to look on it favourably, and I commend it to the Committee. Thank you.

I also want to speak on Supplementary Order Paper 112, which stands in the name of Maryan Street, because it is one of three different approaches that are being countenanced in Supplementary Order Papers on this Alcohol Reform Bill overall to deal with the matter of price. As she says, it deals with that in two ways. It provides that deterrent effect associated with, I guess, the standard understanding of price in microeconomics—that an increased price will reduce consumption—and that is a good thing.

Also, as she notes, the levy that she proposes would provide a dedicated fund for health services. That is an important thing, because what we know—and it will be interesting if the Minister of Health, Tony Ryall, takes a call on this part—is that our alcohol and drug treatment services are incredibly important and are under incredible stress.

There is already much greater need and, indeed, demand for those treatment services than can possibly be serviced by the services that we fund at present. I am sure that Government members will have been visited by treatment service providers—as I have been—advocating for a very substantial increase in the capacity of those treatment services. Indeed, the levy that Maryan Street proposes would be one method of providing a revenue source to enable the Government, which, of course, is cash-strapped, to do that.

I want to focus a little now on the other aspect of the levy that Maryan Street proposes, and that is the deterrent effect, and come to those three mechanisms that have been proposed and perhaps weigh up some of the advantages and disadvantages of the three. Certainly, the Law Commission in its report canvasses minimum pricing, and we have heard some discussion about that. It recommends a 50 percent increase in the excise tax on alcohol, and on a later part of this bill, Supplementary Order Paper 130, which stands in my name, seeks to implement the Law Commission’s recommendation. Then there is this third option that Maryan Street has introduced to the debate. So when we look at those three options, I guess we look at which of those is going to have the biggest effect. It may be that some combination of them is appropriate.

We use price in relation to tobacco control as a means of suppressing demand. I think it would be fair to say that, I think, every member of this House has recently voted for increases to the excise tax on tobacco on that basis—to reduce consumption of tobacco products. In that context it is recognised that increasing the price of tobacco is the most effective means of reducing consumption of tobacco products. When it comes to alcohol, there is no reason to deal with alcoholic beverages in any different way from the way that we deal with tobacco. Actually, we know that increasing the price of alcohol—and, as I say, there are three ways proposed for doing that, but whichever way we choose—is going to be the most effective way of reducing consumption and thereby reducing the harm associated with alcohol, which, after all, is the object of this bill. So it is perverse, in fact, that the Government embraces and, indeed, celebrates that price increase mechanism—

I want to speak to Supplementary Order Paper 122 in my name, which has the effect of restricting the alcohol content of ready-to-drinks—the alcopops—to 5 percent and to no more than 1½ standard drinks per bottle or can. I did not really expect to have to move this amendment, because the Minister who introduced this bill, Simon Power, was particularly strong on the need to restrict the alcohol content of ready-to-drinks. Indeed the bill as introduced does exactly what I am proposing now, with one exception. It made the alcohol content 6 percent, and I am proposing 5 percent.

Consider what the Government said in its question and answer document on the Alcohol Reform Bill. It said: “The Government is particularly concerned about RTDs with a high alcohol content and RTDs that are sold in large containers that hold a high number of standard drinks. We are therefore targeting those aspects of RTDs, which will mean RTDs will be a lower-strength drink (on a par with beer), and will be prohibited from being sold in large containers, thereby reducing the risk of excessive consumption by young people.” Those are not my words. Those are the words of the Government Minister who introduced this bill. Then we had an act of absolute gutlessness, where the Government caved in to those in the liquor industry who lined up in the Minister’s office and said “This is going to hurt you.”, and the Minister put the interests of the profit of the industry ahead of the health and the well-being of our kids.

It is a fact that this House has already made the decision that the age for purchase—

I am sorry to interrupt the honourable member. The time has come for me to report progress.

Progress reported.

Report adopted.

Sitting suspended from 9.55 p.m. to 9 a.m. (Thursday)