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New year = new issues for the industry.

Europe Intelligence Wire

| January 11, 2008 | COPYRIGHT 2008 Financial Times Ltd. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

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Prime Minister Gordon Brown has recently softened his tone on 24-hour drinking, backpedalling on previous hints that the Licensing Act was to be reviewed, according to national newspaper reports. Don' be fooled into thinking that the government has lightened up, though. The coming year is likely to be one of the toughest yet for the drinks trade, with everything from alcohol pricing and promotion to health costs and drinks labelling under the state's spotlight - and the threat of further legislation not far behind.

Once the trade has got past March's Budget - which could see a major rise in drinks duty, according to top trade figures - it will then have the government's initial thoughts on alcohol pricing and promotion, due to be released in April, to look forward to. The discounting of alcohol - particularly in major multiples - dominated headlines throughout 2007, especially as it formed a major part of the Competition Commission's investigation into the grocery market. In its provisional report, published in October, the CC said it believes supermarkets' practices, which include below-cost selling, offer consumers good value for money. Growing competition So the Big Four supermarkets - Asda, Sainsbury's, Tesco and Morrisons - go into the New Year in a buoyant mood, and it is hard to see what more the government can do on pricing, particularly with competition law in mind. It cannot set minimum pricing.

Tesco's head of BWS, Dan Jago, says December's drinks industry meeting convened by Gordon Brown "created a very strong forum and a good agenda to be carried forward. The agenda is being embraced by the drinks industry in a very mature fashion".

The broad consensus is that "the misuse of alcohol is not a retail issue, it's a broad social issue, and all parties need to be involved", Jago adds. Independent retailers - particularly those who think of supermarkets as direct competition - are likely to welcome further investigation into supermarket pricing . Jim Helsby, owner of independent drinks shop York Beer & Wine, says: "Whatever supermarkets say, selling stuff below cost does not fall into what I would regard as responsible retailing." Also in April, the government will roll out national ad campaigns through charity Drinkaware to try to "challenge public perceptions of drunkenness and harmful drinking", according to its alcohol strategy document, Safe . Sensible . Social.

Campaigning for change An educational campaign on alcohol units will follow and young people will be targeted through a social marketing campaign. Local partnerships and communities will also be supported in reducing alcohol-related disorder through separate funding.

Alcohol-related harm was high on the government's agenda in 2007 - and pushed further into the headlines by a strengthened lobbying group, the Alcohol Health Alliance, which is calling for tighter controls on alcohol consumption - and will surface again in September, when results of a state review into the costs to the NHS will be published. Also in September the government will ...

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