Price measures not on the level | Scottish Licensed Trade News

Scottish Licensed Trade News

Price measures not on the level

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Latest uproar over drinks pricing reveals a poor grasp of current law

When the Scottish Mail on Sunday carried a two-page “special report” under the headline “The Bargain Booze Bonanza” (August 2) – complete with an MSP’s call for government action – it looked like a dog-eared rehearsal of old stories about alcohol price promotions.

Jack Cummins is one of Scotland’s leading licensing lawyers. Every month he writes on licensing law and answers readers’ questions in SLTN.

Jack Cummins

Tabloid newspaper exposés of drinks deals – usually infused with something approaching moral panic – are scarcely new.

In fact, as long ago as 2006, the Sunday Mail published an investigation revealing that lager – both own label and branded – could be purchased for less than the cost of bottled water in a number of supermarkets.

Predictably, this latest article recycled the “lager-water” price comparison and provided a platform for spluttering outrage against off-trade deals.

According to Scottish Labour’s public health spokesman, Dr Richard Simpson, multiple retailers’ pricing tactics on packages – although not illegal – were breaking “the spirit of the law”. (Perhaps we should remind ourselves at this point that, since 2006, the Scottish Parliament has passed no fewer than four licensing Acts, on top of the Licensing (Scotland) Act 2005, including various attempts to get to grips with cheap drink).

So far, nothing new – until we come to an allegation by Dr Simpson that JD Wetherspoon – and no doubt other companies – are breaking the law by offering a double measure of spirits for less than the price of two singles.

That view is based on a provision in the 2005 Act outlawing “the supply free of charge or at a reduced price of one or more extra measures of an alcohol drink on the purchase of one or more measures of the drink” (schedule 3, para. 8(2)(c)).

But Dr Simpson is simply wrong. The cost of drinks measures is not regulated by ‘linear pricing’.

Back in September 2005, when the Licensing (Scotland) Bill was heading towards the finishing line, George Lyon (the minister then in charge of licensing) gave categorical assurances to a parliamentary committee: “It has been suggested that the description of irresponsible promotions [in the Bill] would have the additional result of introducing linear pricing, by which I mean that a double measure of a drink would have to be twice the price of a single measure and so on. It is clear that is not our intention. The provisions are directed specifically at promotional activity, not pricing activity”.

shutterxstock_bartender pouring drink

Quite apart from Lyon’s explanation, it’s clear to me that paragraph 8(2)(c) envisages a two-stage process: provided a customer purchases one measure of a drink, further measures then become available at advantageous prices – the extra measure price is conditional on the purchase of a single measure.

But the separate pricing of single and double measures is an entirely different matter. And as one of my colleagues pointed out, it has never been suggested that there’s a ban on the differential pricing of wine measures and bottles: three 250ml glasses needn’t cost the same as a 750ml bottle.

That’s not to say that “upselling” is allowed.

If a customer asked for a 250ml measure and was told by the server that buying a bottle would be a better deal, paragraph 8(2)(e) comes into play; a promotion is “irresponsible” if it “encourages, or seeks to encourage, a person to buy or consume a larger measure of alcohol than the person had otherwise intended to buy or consume”.

Dr Simpson’s campaign continues. As part of his Alcohol (Licensing, Public Health and Criminal Justice) Bill – which lacks government endorsement – he aims to close a gap in the 2005 Act by blocking a lower price per item for larger multipacks than for smaller multipacks of the same alcoholic product, whether or not single units of the product are also sold.

But lawyers are already warning that the ban is framed in such a way that it could be easily circumvented – and it might even have the adverse effect of encouraging customers to ‘go large’ on supersize multipacks.

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