Middlesbrough encourages minimum price adoption in revised policy

Middlesbrough Council has approved a new licensing policy for 2011-14 that will “encourage” all licensed premises to apply a minimum unit price of 50p to all alcoholic products they sell, it has emerged.

The final policy, approved by the local authority’s Executive last month, says that “where the premises are found to be selling alcohol below this price, and problems associated with that premises are in breach of the licensing objectives, a responsible authority or interested party may bring a review”.

It goes on to say: “Following the review, the licensing committee may impose a condition in relation to the pricing of alcohol, in order to uphold the licensing objectives.”

The policy also says the licensing authority would expect applicants to demonstrate in their operating schedule how the pricing of alcohol on sale in their premises will not negatively impact on the licensing objectives.

The language of the final policy has been diluted from an earlier draft of the policy, which had said the licensing authority would “expect” all licensed premises to apply the minimum unit price of 50p and that “where premises are found to be selling alcohol below this price, a review of the premises licence will be sought, if relevant representations are made”. In addition, there were no references in the earlier draft to there needing to be problems at the premises.

In the background notes to the final policy, Middlesbrough says it had been introduced in an attempt to reduce crime and disorder in the town. The council points to local and national concerns about the potential for drunkenness and disorder by discounting and sales promotions.

The authority says it recognises that the mandatory conditions, which came into force in April 2010, may address irresponsible drinks promotions. But the local authority adds that it was aware of the impact of the availability of cheap alcohol sold through off licence premises, “particularly products aimed at binge drinking, problem and underage drinking”.

The licensing authority acknowledges that in adopting the policy, it is departing from the revised guidance to the Licensing Act 2003. The guidance advises authorities not to attach standardised blanket conditions promoting fixed prices for alcoholic drinks to premises licences, club licences or club premises certificates; it also directs to the mandatory conditions.

The policy, which is expected to be uploaded to the council website in the next few days, adds: “It is the view of this licensing authority, the police and trading standards in Middlesbrough that it is the general pricing of alcohol which affects its level of consumption, not solely the ‘happy hours’ or other drinks promotions…. A minimum unit price is about ensuring alcohol is not available for pocket money prices.”

The council says it expects that imposing a minimum unit price would have the greatest effect on strong, cheap alcohol that is traditionally consumed by younger and problem drinkers, and could deter “pre-loading” of alcohol before a night out.

The move is also expected to reduce anti-social behaviour, improve health and protect the on-licensed trade. “The introduction of a minimum price would have no effect on the average price of a pint of beer,” it suggests.

The council justifies the new policy on the basis that Middlesbrough is well above average in the 15 statistical indicators of adult alcohol related harm broken down by local authority area. Local Probation Service assessments also showed that alcohol was a contributory factor in offending for 74% of those who committed criminal damage, 63% of violent offenders and 23% of burglary offenders.

Middlesbrough has one of the highest levels of alcohol-related health problems among under 19s in the country, it added. The rate of alcohol-specific hospital admission for under 18s is the 11th highest of England's 327 authorities.

Jonathan Hyldon, a solicitor at leading licensing law firm John Gaunt & Partners, said the amendment to the final wording – where premises are encouraged rather than expected to implement the minimum price – suggested that the draft policy had gone too far. "What would have been the repercussions or expected repercussions on licensed premises if they disagreed and did not comply when they were expected to?"

But he said that even though the policy had now been amended, there were still "serious issues which arise". Hyldon pointed out that the government did not include minimum fixed pricing in the new mandatory conditions introduced in April and October 2010. "The legality of fixed minimum pricing must therefore be questioned," he said. "Why was this not included in the mandatory conditions?"

The answer, Hyldon argued, is identified by the guidance Middlesbrough has departed from – problems with competition law. "Fixing minimum prices for alcoholic drinks is possible under UK competition law as long as minimum prices are imposed on premises licensed under the Act by law, or by a public body exercising public functions imposed on it by regulation," he said, adding that this position had been confirmed by the Office of Fair Trading in written advice to local authorities in England.

Hyldon also highlighted how EU trade law goes further. “The creation of an artificial fixed price could be argued as amounting to resale price maintenance and therefore the outcome would be the limitation and distortion of price competition which could well lead to conflict with the European Courts,” he said.

“What is being proposed by Middlesbrough could therefore be open to legal challenge albeit it must be remembered that intervention in the operation of a market can legally be justified in certain circumstances on the grounds of the protection of public health. This is no doubt the main reason why information including statistics is provided in the policy in relation to public health and the detrimental effect of alcohol on it."

Hyldon added that it should also be noted that at part 2 of the Police Reform and Social Responsibility Bill which amends the Licensing Act 2003, primary care trusts and local health boards are to become responsible authorities if the Bill is passed in its current format.

The new policy at Middlesbrough comes amid a national debate on minimum pricing. The Executive of the Association of Greater Manchester Authorities is considering the merits of a draft bylaw designed to introduce minimum pricing.

The Prime Minister, David Cameron, had previously lent support to AGMA’s discussions on the issue, saying that he thought that “the idea of the councils coming together on this is a good one and we will certain look at it very sympathetically”.

Philip Hoult