Supplementary memorandum by Molson Coors
(AL 76)
I write to confirm the offer made during Simon
Davies', Molson Coors UK Marketing Director, appearance before
the Health Select Committee on Thursday 9th July, in connection
with the issue known in the United Kingdom as "minimum pricing".
Mr Davies gave, in our view, a clear account
of our marketing practices in response to members' questions.
It is our view that our marketing and advertising practices, whilst
constantly under review, demonstrate our determination to behave
in a responsible manner and we welcomed the opportunity that your
Committee provided to discuss these matters.
As you would expect, when Mr Davies was invited
to appear before the Committee, the management of Molson Coors
UK carefully considered the issues that were likely to arise.
During our review of these issues, it became clear that one of
the most controversial was likely to be that of "minimum
pricing", also known as "social reference pricing".
In consultation with our global colleagues, we felt that this
may be an area where our Company's particular experience and expertise
would be beneficial to put at the disposal of the Health Select
Committee.
Molson Coors is both a family owned brewer and
a global one. As such, we work with legislative and regulatory
authorities around the world in addressing the public policy issues
that arise from the nature of our products. As you may know, our
Company has its roots in North America and operates in Canada
under the Molson name. The Canadian federal system has meant that
regulatory initiatives may be tried in one or more provinces and
where possible, appropriate comparisons made between outcomes.
During my twenty years in the brewing industry, I spent some time
working for Molson in Canada myself. It was during this time that
I became more aware of "social reference pricing" and
its potential in addressing alcohol issues. Accordingly, on taking
over as Chief Executive Officer of the Company's UK operations
it seemed appropriate to me that we should look at this experience
and assess whether it has something to offer in the UK context.
We do not know definitively whether the introduction
of minimum pricing in the United Kingdom is the right way to go.
As Committee Chairman, you will be well aware of the very diverse
views on this subject. Price is, in our opinion, certainly not
a sole or decisive factor in addressing alcohol abuse . Certainly
there are no single measures that, by themselves, will solve the
problem.
However, price may be a factor in extreme cases.
In particular, where market distortions or failures lead to price
competition such that it is considered a significant problem by
groups such as the police, we wish to work with all interested
parties in addressing the issue. We believe that a degree of "market
failure" in the UK has occurred in the pricing of alcohol
products at retail. Indeed, we note and appreciate the reference
to this challenge in the evidence given on behalf of Tesco. As
a general principle we support responsible behaviour in the context
of a free market. However, we also know that markets are rarely
perfect and that to maintain a healthy market place, market distortions
should be addressed.
Therefore, while we generally do not support
Government price controls, we believe that social reference pricing
may be helpful in the exceptional case of extremely low prices
in the UK. To this end, I have made a number of public comments
suggesting that a more detailed examination of the issue of minimum
pricing would be desirable and that we would wish to take an active
part in such consideration.
So, it is in this context that I take pleasure
in writing to you to confirm and reiterate the offer made to the
Health Select Committee on Thursday 9 July to put at the
Committee's disposal such expertise as we may have in Canada and
around the world in this area. Further, if I can be of any further
assistance to you I would be delighted to be so.
Molson Coors is a family brewer, I am a family
man, behaving properly is an integral part of our collective and
my personal commitment to operating to the highest standards.
My Company and I are proud of our product and will champion it
wherever we can. Part of that championing is to make sure that
we actively seek new ways of ensuring that our product is always
consumed responsibly. I am very pleased to be able to take this
opportunity, on behalf of my Company, to offer every assistance
to your Committee in its work.
Mark Hunter
Chief Executive Officer
21 July 2009
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