Those north of the border who enjoy drinking cheaper whisky received a shock recently after it was announced the minimum price for a bottle of the spirit is set to increase by a whopping 30 percent.
The move comes amid rising deaths and hospital admissions, with government ministers looking for new measures to help tackle the issue.
This isn’t the first time controversial plans have been drawn up to try and reduce the harm caused by binge drinking in Scotland. The Scottish government introduced a world-first policy in 2018 banning retailers from selling alcohol below 50p per unit.
Announcing the new rule, Deputy First Minister Shona Robison said the minimum unit price (MUP) will be increased to 65p.
The increase is subject to parliamentary approval – once approved it should come into force on 30 September.
As reported by Sky News, Ms Robison said: “Research commended by internationally-renowned public health experts estimated that our world-leading minimum unit pricing policy has saved hundreds of lives, likely averted hundreds of alcohol-attributable hospital admissions and contributed to reducing health inequalities.
“Despite this progress, deaths caused specifically by alcohol rose last year – and my sympathy goes out to all those who have lost a loved one.
“We believe the proposals, which are supported by Scotland’s chief medical officer, strike a reasonable balance between public health benefits and any effects on the alcoholic drinks market and impact on consumers.
“Evidence suggests there has not been a significant impact on business and industry as a whole.
“Alongside MUP, we will continue to invest in treatment and a wide range of other measures, including funding for alcohol and drug partnerships which rose to £112m in 2023-24.”
Reaction
When the MUP was introduced in 2018, the additional money generated from this pricing policy went towards various public health initiatives and services.
So this additional revenue contributes to the overall public funds, helping to address the societal and economic costs associated with alcohol misuse.
The funds are given to areas such as healthcare, treatment programs, education campaigns and other initiatives aimed at reducing alcohol-related harm and promoting public well-being, so it’s not simply a case of putting up the price and hoping it puts people off.
Predictably, reactions to the measures have been mixed. While some agree that the move is necessary to help save lives, others have suggested it will be the poorest in society that will be hit the hardest. Opponents believe that low-income alcoholics, in particular, will pay the price.
However, one advocate for the MUP raise is Alison Douglas, chief executive of Alcohol Focus Scotland, who says that isn’t necessarily the case. Ms Douglas said the system was designed to reduce consumption for the roughly one million Scots who drink above the minimum guidelines, rather than the country’s 50,000 dependent drinkers.
Could This Affect You?
Whether or not the move will have the intended result remains to be seen, but with deaths and hospitalisations putting additional strain on an already threadbare health service, hopefully, this levy will help deter some people from overindulging.
However, assuming the move is a success, if you’re involved in the whisky industry or you have investments in the spirit then you’d be forgiven for wondering whether this is going to affect you.
In truth, it’s difficult to say, but it really all depends on the nature of your interests. If you have shares in a specific manufacturer or distillery and their sales are hit then you may well feel the repercussions.
But keep in mind these measures are designed to target mainly the cheapest spirits on the shelves. If you have investments in premium-quality whisky then it’s unlikely to affect you at all.
From a purely whisky investment perspective, this shift in the MUP could create new considerations. For instance, with the tax generated contributing to public welfare, the whisky market may see increased volatility as pricing strategies start to adapt to the new regulatory environment.
Investors keen on whisky may find themselves navigating a changing landscape, where factors beyond the usual market forces come into play, so it’s worth keeping this in mind.