Ireland's Very Affordable Alcohol - Alcohol Action Ireland

Alcohol in shops and off-licences is almost 70% more affordable than 20 years ago.

Ireland’s very affordable alcohol must be comprehensively addressed and a ‘polluter pays’ principle applied.

Alcohol Action Ireland has today 12 July 2023 published a report commissioned from the University of Sheffield which examines both the price of alcohol and its affordability over the past two decades to May 2023.

Using data from the Central Statistics Office (CSO), the report noted that overall, alcohol prices have kept pace closely with inflation although there are different experiences between on trade (i.e. pubs and restaurants) and off-trade (supermarkets, shops and off-licences).

While headline figures show increases in alcohol prices a key area highlighted in the report is the affordability of alcohol. This was examined by looking at the relative prices of alcohol compared to other goods along with a measure of disposable household income. This ‘affordability index’ is widely used internationally. The data from Ireland indicates that on-trade affordability has increased by just over 14% while off-trade alcohol has become 67% more affordable in the past two decades.

The report also noted that while alcohol duty rates are higher than they were 20 years ago, when adjusted for inflation their value has actually fallen considerably.

Author of the report, Colin Angus, Senior Research Fellow, Sheffield Alcohol Research Group, said:

“The figures in this report show that alcohol in Ireland has become more affordable in recent years, particularly in shops. The World Health Organization highlight alcohol taxes as a key tool for governments to reduce alcohol-related harm, but in order for them to be effective they need to keep pace with inflation. Alcohol duty rates haven’t changed since 2013 and recent high levels of inflation mean they are now 15% lower in real terms. This highlights the importance of linking alcohol pricing policies to inflation in order to prevent increases in alcohol consumption and harm.”

Commenting on the findings, AAI’s CEO, Dr Sheila Gilheany said:

“Affordability of alcohol is a key driver for alcohol use. Minimum Unit Pricing of alcohol is an important policy measure which we welcome. However, even with MUP, alcohol is still very affordable particularly in the off-trade sector. The introduction of MUP in Jan 2022, led to an increase in off-trade prices but this only brought them back to where they were 20 years ago.

In other jurisdictions, such as Australia, there is an automatic uprating of duties in line with inflation. It is of note that the 2022 report from the Commission on Taxation and Welfare recommended that the link between the public health rationale and design of alcohol taxes should be strengthened.

Given that alcohol places a heavy burden on the health service, with 1500 hospital beds in use every day for alcohol related illness, it is vital that the government use all the policy measures at its disposal to address alcohol harm.

The alcohol industry frequently decries the level of alcohol duties in Ireland, yet in reality alcohol costs Ireland at least €3.7 billion annually while alcohol duties only raise around €1.2 billion annually. Beyond these measurable costs there is the incalculable suffering from 4 deaths every day from alcohol and the devastation to families particularly the 200,000 children impacted by alcohol harm in the home. It is more than time for the government to have a ‘polluter pays principle’ and ensure that the alcohol industry pays for the harm caused by its products.”

Notes

Full report is available here.

Current alcohol duties are similar for beer and cider (€0.282 and €0.295 per standard drink respectively), higher for wine (€0.425) and highest for spirits (€0.532). A standard drink contains 10g of alcohol which is equivalent to a half pint of beer, a small glass of wine or a pub measure of spirits. These levels were last increased in 2013.