Thursday 13 December 2018

New public health legislation could 'undermine' surging alcohol exports, warn drinks industry

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Ralph Riegel

THE drinks industry has warned the new Public Health Alcohol Bill could undermine surging Irish drinks exports, result in lower visitor numbers to distillery heritage centres and even prevent the entry of new boutique spirit manufacturers to the sector.

The warning came as the proposed new legislation was staunchly defended by public health campaigners - with Alcohol Action Ireland warning the priority of the drinks industry was to sell alcohol and not to safeguard public health.

However, the Alcohol Beverage Federation of Ireland (ABFI) warned the unintended consequences of the new regulations could prove hugely damaging for the drinks industry.

ABFI cited two expert reports by DKM and Power Consultants as highlighting the potential consequences for the industry of alcohol advertising bans and tough new labelling controls which include a cancer warning.

The Irish drinks industry exported goods valued at €1.2bn last year and employs more than 90,000 people directly and indirectly.

The drinks industry warned that a ban on alcohol-related advertising could hit everything from drinks exports to tourist numbers attending Ireland growing number of whiskey heritage centres.

The DKM report warned the new regulations could even prevent Ireland being used as a 'test bed' for new drinks products.

It also highlighted the economic consequences of the measures such as inadvertently incentivising cross-border shopping, restricting product innovation and negatively impacting small producers and retailers, particularly in rural Ireland.

However, Alcohol Action Ireland (AAI) hit out at the claims and warned that no business should have an architectural role in constructing Irish health policy.

"We believe the bottom line remains the same, there is an irreconcilable conflict between those who wish to protect public health from alcohol harms and those who seek to guard pecuniary interests selling alcohol," AAI director Eunan McKinney said.

"While I appreciate that the alcohol industry will seek every opportunity to promote their product perhaps a balanced analysis of the facts would serve us all well."

Mr McKinney pointed out that Fáilte Ireland surveys have found tourists visit Ireland for its people, scenery and historical culture - with industrial distilleries not mentioned in the first 13 most important visitor influence factors

"The Irish Whiskey Association (IWA) has, like IBEC and ABFI before, again criticise Government and the Department of Health for their commitment to the principles of the World Health Organisation, which categorically state 'the alcohol industry has no role in the formulation of alcohol policies, which must be protected from distortion by commercial or vested interests.' A review of the lobbying register highlights this has not always been the case."

"However, by refusing a further intervention now that simply seeks to dilute, or delay, innovative public health measures is not unbalanced but merely recognises that, on this issue of public health, the interest of business cannot hold equal weight."

Prof Frank Murray of the Royal College of Physicians, said that every day the Irish healthcare system has 1,500 beds occupied as a result of alcohol use.

But the ABFI pointed out that the Irish drinks industry is a critical component of the agri-food economy.

Irish gin exports soared by 300pc last year with 30 brands now being exported and numerous 'boutique' manufacturers enjoying record sales.

Irish whiskey is, by sector, the fastest growing drinks type in the world.

The number of people visiting Irish whiskey heritage centres last year soared by 11pc.

The ABFI warned that the new legislation will "put huge additional costs on producers."

They warned that the new labelling requirements - including a cancer warning - "would act as a severe barrier to entry and such a measure would cause serious reputational damage to Ireland’s premium drinks products."

Carlow Brewing Company boss Seamus O’Hara, said the new measures will have a significant impact.

“The proposed changes to labelling would be damaging for craft breweries like ours. On the one hand, the Government has identified the craft beer sector as a major driver of future growth and yet, on the other hand, wants to brand our products with a cancer warning label. It should also be noted that no other country in the world has mandatory cancer labels on alcohol products and we believe that such a measure applies a stigma to products produced in Ireland."

ABFI director Patricia Callan warned the unintended consequences of the new regulations could be very serious.

“The drinks industry is an important Irish industry, with innovation at its core," she said.

"However, we are concerned about the unintended negative consequences of the Bill. We have seen a number of new players and new products hit the market in recent years, which has supported growth."

"The Bill could slow down or even reverse this growth, as it includes proposals that would act as a barrier to entry and a barrier to innovation.

Furthermore, the Bill is being introduced at a tumultuous time for Irish business, with 2018 due to be a pivotal year in the Brexit negotiations."

“We believe there is scope for reasonable amendments on advertising and labelling, which would protect competition, innovation and investment in the industry, as well as choice for consumers.”

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