Minimum Unit Price (MUP)
Minimum pricing is a ‘floor price’ beneath which alcohol cannot be sold and is set based on the amount of pure alcohol in a product measured in units or grams so the more grams of pure alcohol in a bottle/can, the higher the price. The relationship between alcohol price, consumption and harm is the foundation on which the policy of minimum pricing is built.
Minimum pricing has been favoured by health advocates as an effective strategy to address the growing health crisis that has resulted from the increased affordability of alcoholic beverages in some countries where supermarkets and shops are using cut price alcohol to attract customers. Minimum pricing guarantees an effect on shelf price, it relates price to alcohol content, and it is simple to apply. Large retailers cannot simply absorb price increases as can happen with other pricing policies.
The Scottish case
Alcohol in the UK is 44% more affordable today than 30 years ago. There has been increased competition between retailers who have responded by cutting prices and offering deep discounts and promotions. The increased affordability of alcohol has been a major driver of rising consumption and harm in the UK in recent decades.
On 24 May 2012, the Scottish Parliament passed legislation to introduce a minimum retail price for alcohol with the aim of increasing the cost of the cheapest, strongest alcohol products in order to reduce and deter harmful drinking. Alcohol (Minimum Pricing) (Scotland) Act 2012
A study carried out by the University of Sheffield estimated that in the first year alone, introducing a 50p minimum unit price would see:
- 60 fewer deaths
- 1,600 fewer hospital admissions
- 3,500 fewer crimes
Minimum pricing for alcohol was due to come into force in Scotland in 2013. However, the European Commission (EC) has objected to minimum pricing and has asked the UK to abstain from introducing a minimum pricing for alcohol. In its detailed opinion the EC argues that taxation should be used as an alternative to minimum pricing as it is a less trade restrictive measure. The EC claims that alcohol tax increases can achieve the same impact as minimum pricing in reducing alcohol-related harm. Full text of the detailed opinion.
Read the Scottish Government's position on minimum unit pricing of alcohol (april 2013) (available in 21 EU languages)
Scottish Government's position on minimum unit pricing of alcohol (april 2013) (available in different EU languages)
A comparison of the effectiveness of alcohol tax increases and minimum pricing (by AFS) (November 2012)
Briefing - Reducing the affordability of alcohol (by the British Medical Association)
Analisys of the Economic Effects of Scotland's minimum pricing legislation(by Diageo) (August 2012)
Website for the facts about minimum pricing: http://minimumpricing.info/