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ACCORDING to the most recent figures available (2003), alcohol-related harm costs the state and its taxpayers around €2.6 billion a year.
This is in the form of healthcare costs, road deaths and injuries, crime, absenteeism, poor performance and lowered productivity in the workplace, lost profits, lost revenue and sick pay. And this is before we count the human cost of our drinking.
Unfortunately, many alcohol-related costs don’t appear on the Department of Finance’s balance sheet. Ireland already has extraordinarily high levels of alcohol-related harm and costs, with over half of all drinkers reporting harmful drinking patterns which can damage their health as well as those around them. Between 61,000 to 104,000 children in Ireland live in families adversely affected by parental alcohol problems.
Lowering the price of drink through an excise cut will lead to an increase in alcohol consumption, accompanied by an increase in the harm caused and the associated costs of responding to it.
The decision to cut excise also reduces Government revenue in the form of lost excise, a figure that could run into hundreds of millions.
For these reasons we are at a loss to understand the logic behind the decision to make alcohol even cheaper.
Finance Minister Brian Lenihan chose to cut the excise duty to “protect exchequer revenue and stem the flow of cross-border shopping”.
But the minister admitted that the sterling differential is the primary “pull factor” for shoppers going North.
Let’s debunk this myth – cheap drink is not the key driver of cross-border shopping.
The CSO tells us such shoppers, on their most recent trips, spent an average of €286 – €32 (or 11%) of it on drink. These figures are from the same CSO report that the minister quoted during his budget speech. This is a wasted economic exercise and the logic behind the decision to cut excise duty is truly baffling when the clear message from the WHO is that increasing the price of alcohol is one of the most effective ways to reduce harmful alcohol use.
By cutting alcohol excise, the Government has chosen to stimulate the growth of alcohol-related harm and costs, to increase the alcohol-related burden on essential services already under strain: health, emergency and social services.
The budget increases the burden borne by children, families and communities already struggling to cope with the effects of harmful alcohol use.
Acting Director Alcohol Action Ireland
25 Great Strand Street
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