Retail Ireland presentation to the Joint Oireachtas
Committee on Health & Children
Thursday 15th December 2011
“Alcohol marketing with particular reference to minimum
pricing and the targeting of younger people”
Introduction
Retail Ireland would like to thank this committee for the opportunity to
address it on this important issue. We have been following the debate in this
room and elsewhere on the issue of alcohol misuse and remain fully
committed to playing our part in tackling alcohol misuse.
By way of introduction, I am Frank Gleeson and I am the Chair of Retail Ireland.
I am also the Retail Director of Topaz Ireland. I am joined by the outgoing
Director of Retail Ireland, Torlach Denihan.
Retail Ireland is the national representative body for the entire retail sector. It
represents Irish and international department stores, DIY, electrical retailers,
fashion and footwear retailers, major supermarket groups, symbol groups and
a range of specialist retailers. There are over 20,000 food and non-food retail
enterprises in Ireland with 240,000 employees. These companies are both Irish
and international but mostly SMEs.
We take our position as the largest industry in Ireland seriously. We know that
we have a duty to ensure that the retail environment is one that is properly
regulated, operates within the law and meets its responsibilities to society and
to our customers- of all ages.
We are committed to the responsible sale of alcohol. We are of the view that
the sale of alcohol to minors is unacceptable and take steps to ensure this does
not happen. We believe the penalties for those retailers who sell alcohol to
children should be harsh. We also believe that those adults guilty of so-called
“secondary purchasing” should be punished severely. And we believe that Irish
society as a whole must continue to develop a more mature attitude to alcohol
consumption.
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It should be noted that Committee’s deliberations are being made at a time of
huge difficulty in the retail sector.
Retail sales in this country have fallen by over 20% since 2008 due to the
recession and price reductions. At the same time the savings ratio has
increased from approximately 2% to 14% due to weak consumer confidence.
The recent Budget is likely to have a big impact on our sector- higher VAT,
increase fuel costs and higher charges for some public services will impact on
retail sales.
Retail Ireland members continue to battle against issues like laundering and
the sale of counterfeit branded merchandise, as well as cross-border sales.
These various forms of crime cost the Exchequer hundreds of millions of euro
in lost taxation and cost the retail sector similar amounts in lost sales.
None of this, however, means that we do not share your desire for a well
regulated, responsible retail space and we remain committed to working in
partnership with you.
Myths
Before I speak of the code of practice to which our industry subscribes, and on
the issue of pricing, I would like to place before the Committee some facts that
have perhaps been missing in the debate here to fore.
The first thing to say is that by all indicators, alcohol consumption has fallen
and is continuing to fall in this country. The Government’s own figures show
that consumption has fallen by almost a quarter in the last ten years.
Irish people drink the same amount that they drank in the mid-1990s, and our
consumption is less than in countries like France and Austria.
This reduction in consumption began during the peak of the Celtic Tiger and
has accelerated since the start of the recession. I would also like to point out
that the reduction took place following the abolition of the Groceries Order
and the advent of price promotions in retail outlets.
On the issue of price, I believe the Committee should also be aware of the facts
before it makes recommendations.
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The price of alcohol in Ireland is the highest in Europe. Eurostat, the EU
statistics office, published a report in June of 2011 – just a few months agothat shows that the price of alcohol in Ireland is 170% of the EU average. This is
as a result, they believe, of the very high taxes levied on alcohol in this country.
Ireland, as you will be aware, is an outlier with three other countries- the UK,
Sweden and Finland- in terms of very high alcohol taxes.
So falling consumption and historically high alcohol prices should be born in
mind when considering this issue.
RRAI code
As I said, Retail Ireland is committed to the responsible retailing of alcohol. The
mixed-trading members of Retail Ireland were instrumental in the
establishment of Responsible Retailing of Alcohol in Ireland – or RRAI- and the
drawing up of the voluntary Code of Practice on the Sale and Display of Alcohol
Products in Mixed Trade Premises in tandem with the Department of Justice
and Equality. This code has been in place since 2009.
RRAI is a limited company that oversees the code of practice and has an
independent chairman who administers the monitoring of the code. He also
produces an independent, annual compliance report for presentation to the
Minister for Justice and Equality.
Retail Ireland members are extremely proud of the role they have played in
establishing RRAI and the code of practice which, as the latest compliance
report states, is “fundamentally more transparent and publically accountable
than normal self-regulation or voluntary codes”.
The code now applies to the vast majority of licensed stores in the mixed
trading sector including all major mixed trading premises. Under the code,
 alcohol can only be displayed in-store in one separate area;
 the area where alcohol is sold must, as far as is possible, be in a location
through which one does not have to pass to access other products;
 alcohol cannot be displayed or advertised in shop windows;
 in-store advertising of alcohol is confined to the area where it is
displayed;
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 in-store advertising of alcohol cannot appeal to minors;
 alcohol can only be sold at clearly designed check-out points, monitored
by CCTV cameras;
 proof of age must be produced where the customer appears to be under
the age of 21;
 staff must be properly trained in the area of alcohol sales and must have
an adequate knowledge of the law
 the code and complaints procedure must be clearly displayed for
members of the general public.
This code of practice is independently audited and verified on an annual basis.
A complaint procedure has been put in place and RRAI operates a 24 hour
hotline for those who wish to report an alleged breach of the code.
Its implementation has made a marked difference in how alcohol products are
displayed and promoted in retail outlets around Ireland. Alcohol can no longer
be displayed and promoted at the entrance to stores. Alcohol can no longer be
found at the end of aisles. All alcohol is now located, whenever possible, in a
single part of the store that customers can chose not to enter should they
wish.
Further, the advertising activity of retailers has changed too. Now, when a
retailer advertises in the print and broadcast media, only one quarter of the
advertisement can refer to the alcohol products it sells. Typically this results in
advertising material that includes information on good value food, household
items and non-alcoholic beverages as well as information on the range of
alcoholic drinks available.
The code runs in tandem with legislation on the sale of alcohol that includes,
for example, a restriction in the hours of sale. It is also, of course, against the
law to sell alcohol to someone under the age of 18 years.
Retail Ireland also fully supports test purchasing by minors in outlets suspected
of flouting the law and increased enforcement to prevent purchases by minors
using distance sales. As stated, we also support harsh punishments for
individuals found guilty of secondary purchasing.
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The RRAI code is working.
According to the recently published RRAI compliance report, compliance with
the code stands at a very high 85%. This rises to almost 95% of supermarkets.
Almost 100% of stores met the test of displaying alcohol in one part of the
premises and not having satellite displays, while over 97% were judged to have
complied with the requirement of displaying alcohol in a part of the premises
that customers do not have to pass through to get to other beverages and food
products.
None of the stores audited allowed for the purchase of alcohol at self-service
check outs and all alcohol check-out points were monitored by CCTV cameras.
These figures prove that the RRAI code is working. It has made a tangible
difference to how alcohol is displayed and promoted in retail outlets
throughout the country. We believe the code provides a flexible and effective
mechanism to ensure that alcohol sales in mixed trading premises are carried
out in a responsible manner, where young people are not overly-exposed to
alcohol brands, where customers are not inconvenienced and where retailers
are not over-burdened with unnecessary costs.
Pricing
On the issue of pricing, I understand that this an issue of concern to many
members of the committee and the wider public. However, as I have said
already, alcohol in Ireland is not as cheap as many people claim it is.
Retail Ireland notes that Minister Michael Noonan announced in his Budget
speech early last week that the Government would bring forward proposals in
2012 on the issue of alcohol pricing. We have also heard Minister Shortall’s
comments.
It might surprise some members of the committee to hear that we have an
open mind on this issue. We look forward to hearing what the Government has
to propose and engaging with them to ensure that they achieve their own
policy targets while also understanding the retail sector’s requirements and
those of consumers.
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We are also aware that the Department of Justice and Equality is also looking
at proposals in the area of price promotions of alcohol. Again, we have an
open mind on this issue.
That said, Retail Ireland is very strongly of the view that any proposals in these
areas must be done an all-island basis. There is quite simply no point at all in
introducing restrictions on the sale of alcohol in the Republic of Ireland which
do not apply in Northern Ireland. The net result of such a policy would be
a. no reduction in total alcohol consumption in this jurisdiction
b. a large reduction in alcohol sales in retailers based in the Republic
c. a large reduction in the tax take from alcohol sales for the Exchequer
here.
Wider alcohol debate
While we are happy to engage with the committee, and with all stakeholders
on the issue of alcohol sales, I would like to state that ultimately, our national
problem with alcohol is not about how it is sold, or purchased, but how it is
consumed.
All the restrictions in the world on the sale of purchase of alcohol will not, we
believe, in tackling alcohol misuse. One need only look to countries like Spain
and Portugal, where alcohol is very cheap by Irish standards, and where it is far
more widely available at any time of the night and day.
Why is it, that despite this low price, high availability regime in place, Spanish
and Portuguese people do not drink in excess? Why is it, that in Ireland where
alcohol is more expensive and less available than in the Mediterranean, we
seem to have a more problem with it?
Why is it that to be drunk is something an Irish person brags but something an
Italian would be ashamed of?
Retailers are playing their part-but the answer to our national alcohol problem
does not solely lie with us.
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