Working to reduce alcohol harm

Alcohol’s cost to society

The World Health Organisation (WHO) has pointed out that, beyond health consequences, the harmful use of alcohol brings significant social and economic losses to individuals and society at large.[i]

In Ireland, the burden of alcohol related harm is often experienced by those around the drinker, such as a family member, friend, co-worker or innocent bystander.  Alcohol’s harm to others undermines public safety and is experienced in every community, ranging from the nuisance factor, feeling unsafe in public places, drink-driving, to a violent attack by an intoxicated drinker.[ii]

Although not often publicly visible, alcohol’s harm to others within the family can have very serious consequences for the safety and well-being of family members, with children being the most vulnerable. Life-long damage, in the form of foetal development disorders, can also be caused to the unborn child by alcohol consumption during pregnancy.[iii]

Alcohol consumption is a significant road safety issue in Ireland and Road Safety Authority research found that it is a factor in 38% of all deaths on Irish roads, as well as many other collisions resulting in injuries.[iv]

A review commissioned by the Department of Health, which outlines the economic costs of deaths, illness and crime attributable to alcohol misuse in Ireland, estimates that the overall cost to Irish society in 2013 was €2.35 billion.[v] The total tax take from alcohol in that year, including both excise and VAT, was €1.98 billion.[vi]

Therefore it’s clear that while drinking alcohol is an individual choice, it is one that has significant social and economic impacts, and it is this wide range of harms to others, and costs borne by the State and, ultimately, the taxpayer, that economists define as ‘externalities’.[vii]

The OECD states that when these ‘externalities’ exist, consumers typically do not appreciate the full costs of their consumption, because the price they pay when they purchase a commodity does not reflect the external costs of its consumption[viii] and in Ireland the costs of alcohol harm to society are huge and complex.

Dr Ann Hope pointed out that just some of these costs can be estimated with some degree of reliability and that problem alcohol use gives rise to three types of costs: direct costs, indirect costs and intangible costs.[ix]

Direct costs, such as costs to the health care and criminal justice systems, are borne by the government and therefore by taxpayers. Indirect costs include lost output through alcohol-related absenteeism and premature death or disability. Intangible costs are mainly the pain and suffering experienced by those who experience alcohol-related problems, due to their own drinking or someone else’s, and are the most difficult category of costs to measure.

There is no doubt that ‘the societal costs of existing levels of alcohol consumption in Ireland far outweigh the employment, trade and tax benefits’.[x]

Harmful alcohol consumption and binge drinking, in particular, carry ‘devastating personal and social consequences, they increase health spending and reduce our standard of living’.[xi]

 

References

[i] Global status report on alcohol and health 2014. Geneva: World Health Organisation; 2014.

[ii] Hope A. Alcohol’s Harm to Others in Ireland. Health Service Executive; 2014.

[iii] Tackling Harmful Alcohol Use: Economics and Public Health Policy. OECD; 2015.

[iv] Fatal Collisions 2008-2012. Alcohol as a Factor.: Road Safety Authority; 2016.

[v] Hope A. Alcohol Literature Review. Report for the Department of Health. 2014.

[vi] Department of Finance: Tax Yield: KildareStreet; (Available here)

[vii] Tackling Harmful Alcohol Use: Economics and Public Health Policy. OECD; 2015.

[viii] Tackling Harmful Alcohol Use: Economics and Public Health Policy. OECD; 2015.

[ix] Hope A. Alcohol Literature Review. Report for the Department of Health. 2014.

[x] Power J, Johns C. The Efficacy of Minimum Unit Pricing, Fiscal and other Pricing Public Policies for Alcohol. CJP Consultants Limited; 2013.

[xi] Tackling Harmful Alcohol Use: Economics and Public Health Policy. OECD; 2015.