Supermarkets slate minimum alcohol pricing

RMAR

RMARKETS have hit out at plans for minimum alcohol pricing, despite being told they could make up to £2.2bn in extra profits under proposals to curb binge drinking.

Public responses to David Cameron's plans to introduce a price floor are set to be invited in the coming weeks, with drinks manufacturers set to campaign against the proposals, saying they will hit moderate drinkers and benefit retailers.

However, both Sainsbury's and Morrisons criticised the proposals yesterday. "Despite reports of potential profits for supermarkets we don't support minimum pricing," a Sainsbury's spokesperson said. "It will unfairly penalise the vast majority of customers who buy alcohol as part of their grocery shop." Morrisons said: "We should be setting prices, not the government."

The Office of Fair Trading has said that supermarkets would profit from promoting their own higher margin alcohol brands under the plans, while a report from the Centre for Economics and Business Research for drinks firm SABMiller estimates a windfall of £1.8-2.2bn. "Minimum pricing is a poorly targeted policy which taxes the alcohol consumption of the least well off," SABMiller, which owns Grolsch and Peroni, said.

Despite the proposed rise in alcohol prices - which would see a 70cl bottle of whiskey sell for a minimum of £14 at 50p per unit - meaning higher profit margins, supermarkets are worried it will cut food sales. Retailers have in the past subsidised alcohol to encourage shoppers to buy food instore.

Tesco has not criticised the proposals, saying: "We are committed to engaging constructively in discussions with government on ways we can help, including minimum pricing."

Scottish plans for minimum pricing - set to be introduced before English ones -were hit on Friday after Bulgarian objections made to the European Commission delayed an EU consultation on the matter.