Some sense on RTDs

John Hartevelt at Stuff reports:

The liquor industry has scored a win over the planned regulation of in the Government’s reform package.

I think it is a win for common sense, and actually a win for reduced harm from alcohol.

Justice Minister Judith Collins yesterday revealed she had dumped an earlier plan to ban the sale of ”RTDs” (ready-to-drink) with more than 6 per cent alcohol content from off-license stores.

Alcohol reforms initially announced by former Justice Minister Simon Power originally included a ban on RTDs with 5 per cent alcohol or more from off-licenses.

The proposed ban was effectively a form of prohibition.  Research (a phone poll, two point of sale surveys and eight focus groups) Curia did for Independent Liquor left me in no doubt that the impact of trying to ban RTDs over 5% would be a significant substitution effect, with many people going from say 8% RTDs to (on average) 13% self-mixes. Note that the research Curia did for ILNZ was over a year ago, and I have no ongoing commercial relationship with them.

The experience in Australia with increasing taxes on RTDs also produced empirical evidence of increased substitution to spirits, and this is one of the reasons the Law Commission did not recommend this measure.

Instead, the bill will include a ”regulation-making power” for the Government to restrict the sale of RTDs in future. Until the powers are exercised, however, RTD sales will be left to work under the industry’s own code.

”The Government has decided to give the alcohol industry the opportunity to introduce its own measures to limit the harm to young people caused by RTDs,” Collins said.

”The industry has offered to put in place a voluntary code on RTDs. If the industry measures are ineffective, Government has the ability to take action through a regulation-making power in the bill. This allows restrictions on the sale of RTDs at any time in the future.” …

The association promised in April to:

– Limit the production and distribution of new RTDs to a maximum of two ”standard drinks” per single container.
– Show clearly the number of ”standard drinks” on each container.
– Ensure no RTDs have ”specific appeal to minors”.
– Comply with the Code for Advertising Liquor, administered by the Advertising Standards Authority.
– ”Invest and support” responsible drinking educational programmes.

There are some RTDs which are, shall we say, a but anti-social. I’m not a fan of the Bigfoot RTD which was a large 6 – 8 standard drinks in one container.  There is a certain incentive to finish a container, and people don’t tend to share containers as they might say individual drinks.

So a self-regulatory limit of say 2 standard drinks per container has merit in my opinion. A restriction on the number of drinks per container is much more sensible than trying to ban 6% RTDs, when people would then buy 40% vodka. The reality is that some RTD drinkers do not like the 5% RTDs (they call them lolly water) and prefer the stronger ones.

A limit of two standard drinks per container means they have as much alcohol as a standard double nip in a bar.

There were also two other problems with the proposed prohibition on RTDs over 5%. One is that under CER, the RTDs could be made in Australia, and imported here. We would simply be exporting jobs.

The third is that prohibition does not work as well as self-regulation. If you ban say 8% RTDs, then manufacturers could do inventive stuff like sell a container which has (for example) rum in one part and coke in the other, and you just mix them together to make your own RTD (just as many self-mix from spirits from mixers).

I have no doubt that the proposed prohibition on RTDs over 5% would have not only failed, it would have increased overall harm from alcohol. I am glad the Government is going for something that will work, over something that sounds good, but would be harmful.

Comments (92)

Login to comment or vote