Select Committee on Home Affairs Minutes of Evidence

Examination of Witnesses (Questions 440 - 459)



  Q440  Patrick Mercer: I find it very hard to square the proposition that selling alcohol as a loss leader is responsible.

  Mr Chester: We treat alcohol very differently from any other product. We give our colleagues more training on making sure we never sell to underage people than we do to any other product.

  Chairman: But the question is about responsibility in selling alcohol as a loss leader.

  Q441  Patrick Mercer: I find the word "responsibility" a contradiction in terms when one is selling a dangerous drug which from my own past professional experience, and now my parliamentary duties, causes much death and injury particularly to the underage. I do not find that the words "loss leader" and "responsible" sit comfortably together.

  Mr Chester: I can understand why you think that, but I reiterate that the vast majority of our customers who buy alcohol consume it perfectly responsibly. The question is whether you introduce—--

  Q442  Chairman: Mr Mercer is not talking about whether or not your customers are responsible; he is talking about the responsibility of your company's policy. You do not answer for your customers; answer his question.

  Mr Chester: Asda always tries to sell products at the keenest possible price because the vast majority of our customers buy and drink alcohol responsibly. Of course those customers expect us to sell alcohol that is affordable.

  Q443  Patrick Mercer: May I suggest that you substitute the word "irresponsible" or "immoral" for "responsible"?

  Mr Chester: I can only disagree.

  Q444  Chairman: Mr Brown, do you have any comment to make not about your customers' responsible drinking but your company's behaviour in selling alcohol as a loss leader bearing in mind the fact that 46% of offences are alcohol-related?

  Mr Brown: I think there is a question of definition of "loss leader". We sell alcohol which enables us to continue our market share and compete in an extraordinarily competitive market, so we will respond to the actions of other retailers. In doing so we intend to make sure that our customers have a wider choice of quality and value.

  Q445  Mrs Dean: Mr Hayward, what effect does the selling of alcohol as a loss leader have not only on the on trade but on brewers?

  Mr Hayward: At the moment the profitability of brewers is lower than it has ever been before which is why you have the number of closures and redundancies that you face in your own constituency—Mr Salter has already referred to this—and in a number of other constituencies as well. Brewers are finding it incredibly difficult to maintain their operations and some are going out of business as a result of current circumstances. We put the information to the Treasury, as did you, Mrs Dean, that profitability is at an all-time low and the industry will not be able to continue. That will be a serious threat to many communities around the country.

  Mr Chester: I would just make the point about brewers: they are the people who brew the beer that goes into the cans.

  Q446  Mrs Dean: How much pressure does the retail industry put on the brewers to keep their prices low when they sell to you?

  Mr Chester: I do not deal directly with the brewers. I can only imagine that with big corporations like Asda and the brewers there will be robust negotiations over price.

  Mr Lowman: Our members will negotiate as keenly as they can. The reality is that three-quarters of the market is represented by the country's major grocers. We represent part of the remaining quarter, so basic economics suggest that we do not have the same power in that negotiation as some larger retailers.

  Mr Hayward: Our industry has made absolutely clear that it does not like loss leading and it has made representations to all sorts of authorities to that effect. The capacity of our industry and others to pass through duty increases and the like is very low and the net result is lack of investment in the industry.

  Mr Brown: In relation to your question about how we negotiate with the brewers, obviously those negotiations are based upon trying to achieve value which will eventually be passed on to the customers, but it is also very clear that we try to work with suppliers to make sure that they have a sustainable position and we have a position where we are able to sell their product in a value way to our customers. We certainly do not want to disenfranchise or damage the level of choice in supply that is available to us, and we purchase accordingly.

  Q447  Mrs Dean: I put a question to all of the witnesses. How much responsibility does and should the industry take for alcohol-related crime and antisocial behaviour?

  Mr Chester: We should sell alcohol responsibly given all the measures that I and others on the panel have outlined. I agree absolutely that we have a part to play.

  Mr Lowman: We have a part to play. We have to be very clear about cause and effect and the action we are taking in terms of the way we retail alcohol and the effect it has in terms of alcohol-related disorder and so forth. The prevention of alcohol-related disorders is one of the four principles of the Licensing Act. That Act therefore allows action to be taken against businesses that are not doing what they can to meet that objective.

  Mr Hayward: We take it very seriously. We have just introduced a document concerned with managing safety in bars, clubs and pubs which has been discussed with and based upon our negotiations with ACPO in terms of how venues should be managed so that people can drink responsibly.

  Mr Brown: We are very clear that we shall trade only in a responsible fashion within the law. We provide extensive training for our staff and we look to work with the authorities where there are difficult areas in a way to promote public safety and remove any difficulties within those areas.

  Q448  Ms Buck: The chief constable of Nottingham said: "What [the drinks industry] has done is sacrifice responsibility for bigger profits . . .It has already proved itself unworthy of self-regulation." Why would one of Britain's senior policemen say that?

  Mr Chester: Clearly, I cannot comment on what he said.

  Q449  Chairman: Why can you not comment on what he said?

  Mr Chester: I cannot question what he said. If that is his view that is his view. We certainly want to play our part in selling alcohol responsibly. For example, one of the measures we have taken recently is not to sell between 12 and six in all of our town centre stores. We accept this as a very different issue and that we have a part to play.

  Q450  Chairman: Mr Lowman, do you agree with him?

  Mr Lowman: I am not in Nottingham.

  Q451  Chairman: You do not have to be in Nottingham.

  Mr Lowman: He is commenting on what he has seen on the streets of Nottingham and comes to the conclusion that that is down to the acts of the alcohol industry. I believe that the cause and effect between all different parts of the industry, whether it be producers, pubs or shops—it is not one homogenous mass—is not the strong, bold line he suggests; it is much more a dotted line. In that area and all others up and down the country local authorities and the police are able to use powers to tackle premises and parts of the industry that are not doing all they can to meet the four licensing principles.

  Q452  Ms Buck: It is not working and that is why he makes the remark?

  Mr Lowman: Obviously, he feels that it is not working in that particular area, but the powers are there to be used.

  Q453  Ms Buck: So, it is the fault of the police?

  Mr Lowman: I did not say that at all. There are a number of complex issues to do with the causes of alcohol-related disorder. There are cultural issues to do with parenting and policing and sometimes it is very tempting to think that there is one lever we can pull or one place we can look at to solve the problem; it will not. The solution is more complex than that.

  Q454  Ms Buck: I am just asking you: what exactly is your responsibility in this? One of Britain's most senior policemen has said you have lost the right to self-regulate.

  Mr Lowman: We are not self-regulated; we are regulated by the Licensing Act 2003, so our responsibility is to comply with that Act and go further in terms of pushing responsibility particularly in relation to the issue of underage sales.

  Mr Hayward: We are not self-regulated. With the police force in Nottingham we are developing a Business Improvement District because we recognise that area has faced particular problems. We are working with the police and local authorities and hope that the BID will be fully operational before long.

  Mr Brown: I agree with my colleagues that we are not a self-regulated industry. There is a significant level of regulation that is available to the police, trading standards and local authorities. We are very clear that we wish to work with police and those agencies, so I have to divorce myself from the chief constable's comments because there is probably a degree of detail behind them that is perhaps not necessarily reflected in that statement.

  Q455  Chairman: You are a former police officer yourself, are you not?

  Mr Brown: I am.

  Q456  Chairman: Do you agree with Mr Lowman that the powers are there but they are not being used?

  Mr Brown: I believe that the powers are there. There are certain restrictions within the Police Service in terms of resource availability and the challenges it faces which make it even more important that as part of a regulated industry we are prepared to work with former colleagues. We have a big say in terms of wanting it to be a safe environment where people feel comfortable to come and shop with us. It is important that we work with the police, the trading standards and local authority to achieve that environment. For me that is the key.

  Mr Chester: I reiterate that certainly in Nottingham for every one of our shops we have to agree with the police the conditions to be imposed on them, that is, the opening hours and so on. It is far more than self-regulation. For all of those stores the police have every opportunity to come forward with proposals about what more we can do about underage selling or how we retail alcohol.

  Q457  Patrick Mercer: Gentlemen, in what way do you and your members work with the police to tackle underage drinking and alcohol-related crime and disorder?

  Mr Chester: We take pride in the fact that every one of our store managers and colleagues in stores has good links with the local police. They meet regularly and understand the conditions that apply to the store. That has been a very positive move from the 2003 Act and it is something that must continue.

  Mr Lowman: What we are trying to do is spread best practice in the best way and engage in partnership working. "Partnership working" is very easy to say but it is very difficult to do because it involves so many people and takes time and effort. I think the best example is the St Neots project that off traders have piloted which involves all the local agencies getting together and has had an effect in reducing street drinking, using powers to confiscate alcohol, work with parents and so on. That is the benchmark and we are trying to push that best practice around the country. There are also some fantastic examples round the country. Some members even have small police stations in their stores. The absolute priority for us as an industry association is to push that best practice wider and wider.

  Mr Hayward: To pick up what others have said, not repeat it, as an association we actively encourage and try to ensure that every Crime and Disorder Reduction Partnership has a representative from the on trade participating in it. There are ongoing discussions in that regard. We fund Pubwatch, for example. That probably would not exist as a national organisation but for funding by the British Beer and Pub Association. We try to do those sorts of things all of which involve working with the police.

  Mr Brown: Within Tesco we have a policy that demands that our store managers engage with police at a local level. That takes a number of different forms. We have local police stations in some of our stores. We believe that the government's move towards neighbourhood policing is a significant opportunity for communities. We want to make sure that we are part of that. We seek active engagement. Probably one of the reasons I was employed by Tesco in the first place was to promote that policy throughout the company. We would like to think we seek that engagement and respond to the concerns. There are a number of examples of where we have responded to concerns in terms of limiting the licence and limiting product availability.

  Q458  Patrick Mercer: We have already touched on Mr Green's comments in Nottingham. I am also a Nottinghamshire Member of Parliament. It is interesting to see the efforts to bring under control the very widespread alcohol-related problems in the city of Nottingham. What is your opinion of the proposed alcohol disorder zones, and to what extent do you think the industry should contribute towards the policing costs of them?

  Mr Chester: I think it is very difficult for supermarkets to comment on them. Most of our stores are not a hotbed of underage drinking and disorder. We are nervous because obviously where they fall within the zone there is a chance that costs and so on of business will increase, so we want to make sure that they will have an impact.

  Mr Lowman: There is a danger that alcohol disorder zones will be top down forced partnership working; in other words, the police or local authority will say that businesses in an area will do this, this and this. In our experience that is not how partnership working is most effective. We have concerns about that. Again, to return to cause and effect we have to be clear with all these things, whether they are local initiatives or national policy, that the particular measure of an alcohol disorder zone will tackle the specific problems that that area faces. My concern is that given the way the legislation is drafted and the discussion on it sometimes it may miss the target.

  Mr Hayward: Sir Simon Milton who has just given evidence has made it absolutely clear on behalf of the LGA that the proposed regulations in relation to ADZs just will not work. The police and also our industry have also expressed their concerns about it. As far as we are concerned it is an interesting idea but in terms of trying to identify the premises it is an absolute nightmare. On three different occasions the regulations were severely criticised by the Statutory Instruments Committee of the House of Lords to the extent that one Member of the Upper House asked whether there could be a vote, which was quite extraordinary. I highlight the oddity in ADZs that it is unclear whether supermarkets will be picked up in any zone. Because of the definition of their trading they could well be exempt which to the on trade seems utterly illogical.

  Mr Brown: I think that ADZs should be a tool of last resort. A whole continuum of response that needs to be tested and put in place before one ever gets to the suggestion that there should be such a compulsory approach. We would advocate much closer partnership working that starts to address some of the cultural concerns around this issue. ADZs are a tool of absolutely last resort and one can envisage significant difficulties in terms of their implementation.

  Q459  Chairman: I should like to raise a number of issues that have arisen over the past few days. First, the Mayor of London has made the decision to ban drinking on the tube. Does anyone oppose what he has done?

  Mr Hayward: We issued a statement welcoming it.

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2008
Prepared 10 November 2008