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Canadian alcohol pricing research makes waves abroad, not so much at home


Canadian research that shows how alcohol price policies can reduce alcohol-related harm is making waves in the United Kingdom, Australia and the United States—but not yet at home.

International attention has far outstripped domestic attention for a surge of public health-related alcohol research coming out of the University of Victoria’s Centre for Addictions Research of British Columbia (CARBC), the Canadian Centre on Substance Abuse (CCSA), and the Toronto-based Centre for Addiction and Mental Health (CAMH).

A BC study published last month in the journal Addictions received coverage from the BBC, the Sydney Morning Herald and Reuters, but only minimal exposure in Canadian media.

Provinces ranked based on use of strategies to reduce alcohol-related harm That research suggested that a 10% increase in the average minimum price for all alcohol beverages in British Columbia might be associated with as much as a 30% drop in deaths wholly attributed to alcohol such as alcohol psychoses, alcoholic cardiomyopathy and alcohol-induced pancreatitis.

According to the World Health Organization, alcohol is ranked second only to tobacco as a leading factor in death and disability in high income countries, and many public health officials feel alcohol-related harm has been downplayed by governments.

Canadians are above average consumers of alcohol

Canadians consume about 50% more than the global average–an estimated 9.8 litres of pure alcohol per capita annually, more than the average of  6.1 litres of pure alcohol annually, according to research published this month in Addictions.

Canadian research published last October in the American Journal of Public Health revealed trends similar to those in BC after Saskatchewan introduced some new and some increased minimum prices in 2010.

A 10% increase in alcohol prices in  Saskatchewan led to an 8% decrease in consumption of spirits, wine and beer, according to the research that covered the period from 2008 to 2012.

In a 2010 press release, the province explained the intent of the price increase was to reduce the over-consumption of products with high alcohol content and raise money for provincial coffers. (Consumption in next-door province Alberta remained unchanged over the same period.)

Canadian research is being closely watched in the United Kingdom because a very political debate about alcohol pricing is raging in Scotland, explains Professor Tim Stockwell, director of CARB and co-author of the research cited above.

In Scotland, private retailers such as supermarkets and petrol stations sell alcohol, and prices are lower and alcohol consumption is about 50% higher than in Canada, he notes.

Alarm about alcohol misuse prompted new pricing law in Scotland

Widespread concern about alcohol misuse led the Scottish parliament to introduce legislation to set a minimum price of 50 pence per unit of alcohol (a pint of beer has about 2.3 units of alcohol), and British Prime Minister David Cameron has mused about introducing a similar policy. His government has already examined the issue.

In a sense, politicians in the United Kingdom are playing catch up, because in Canada most governments are the major alcohol retailers and “it’s easier to influence price when you have monopoly on sales,” notes Stockwell.

Alcohol retail sales are also private in the United States and Australia. In contrast provincial and territorial governments in Canada—with the exception of Alberta, which has a completely private retail sales structure—are the leading retailers of alcohol and hence already “have direct control over almost all aspects of alcohol pricing policy,” according to the 2012 CCSA report Price Policies to Reduce Alcohol Related Harm in Canada.

Ontario opposition leader Tim Hudak has said that if elected his party would end the Liquor Control Board of Ontario’s monopoly and open up retail sales to the private sector.

Three main pricing policy levers are available to Canadian jurisdictions—setting minimum prices, adjusting prices based on alcohol content, and indexing prices to inflation.

Canada well positioned to employ pricing levers

Provinces and territories employ those pricing policy levers to varying degrees, as shown in today’s sidebar.

Federal, provincial and territorial governments, and manufacturers, benefit from alcohol price increases, and there’s lively discussion among those parties when it comes to pricing policy, Stockwell says.

“But from a public health and safety point of view it doesn’t matter who collects the money, who gets the profits,” says Stockwell. Price increases are “a win-win for everyone—government will make more money, the policy saves lives, and crimes are prevented.”

All the pricing strategies in the 2012 CCSA document were supported in the 2007 recommendations for a National Alcohol Strategy. Stockwell adds that Ontario has been “particularly supportive” of pricing recommendations, and Quebec has also expressed interest.

The toll of excessive alcohol consumption

Go to any Alcoholics Anonymous meeting, or wander the wards of any hospital, and the human toll of excessive alcohol consumption is brought home with a vengeance. Families and careers destroyed, children scarred, and health seriously impaired.

But if overall, population-level alcohol consumption can be reduced when prices are raised, what is the best way to target the heavy drinkers who can cause such havoc to themselves and others?

The authors of the CCSA report speculate that setting minimum prices may be “especially effective” in targeting higher risk drinkers who tend to purchase lower priced alcohol.

Occasional binge drinking can cause “substantial” harm

But the CCSA report also notes that “a substantial amount of harm comes from the relatively large number of moderate-risk drinkers who only occasionally drink in risky ways” such as occasional binge drinking.

And researchers say more study is necessary to determine, for example, what impact the application of price-increase policies will have on low-income problem drinkers and on younger drinkers who are known to “pre-drink” before going to restaurants and bars where alcohol is costlier.

The Ontario Ministry of Finance indexes prices regularly, but is cautious about the possible impact of  further price increases. “Significantly increasing prices beyond current levels could encourage unwanted behaviours such as smuggling or greater uptake of home production or u-brew/u-vint production,” states a presentation by ministry policy analyst Barbara Hewett to an Alcohol Pricing Research Forum held at CAMH last December.

The public and political appetite for higher alcohol prices may be limited, but given the potential health benefits, do you favour higher alcohol prices?

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12 comments

  1. Marc Bisson

    I live and work in a small town knows as the busiest smuggling area for cigarettes, alcohols, guns and humans in Ontario. %featured%Any increase of price for alcohol will stimulate the demand for illegal alcohol and the smuggling opportunities for the organize crime.%featured% The side effect will be the need for reinforcement of the polices forces and consequently more stygmatisation of our neighbour brothers and sisters. I will prefere by far a more intense prevention campaign with better access to programs and services for the people with consumption problems.

  2. Stephen Jones

    %featured%Here we go again: nanny-state complaining about alcoho%featured%l. I love how statistics are used: Canada is above the world-wide average in our consumption of alcohol. So what? We’re including in that analysis countries which do not have a significant social background in consuming alcohol. Should we seek to emulate Saudi Arabia in all things?

  3. Satyendra Sharma MD

    %featured%The commentary of this report indicates that the consumption of alcohol has increased by13% between 1996-2010. It is not relevant unless the growth in population, broken down by age group, in the last 14 years is also taken into consideration.%featured%

  4. Daniel

    Price increases are “a win-win for everyone—government will make more money, the policy saves lives, and crimes are prevented.”

    Well if alcohol consumption is decreased then even with higher taxes it is possible to collect less money than before, right? Isn’t this where calculus comes into play?

    It was my understanding that Ontario had actually decreased tobacco taxes a couple of times because previous increases had led to decreased tax revenue.

    The principles of bahaviourism seem to come into play here. If you give a rat a sharp shock for pushing a button it stops pushing the button. But if you increase the shock slowly it will continue pushing the button until the shock is lethal. I think this reflect the reality of the situation with tobacco in Canada in which prices have increased 400%, but very slowly over 20 years, with the result of more and more taxes but only a very modest decrease in tobacco use.

  5. G.F.

    The government should not levy taxes and price gouging on the populace in order to protect it from the dangers of purchasing a particular vice. Let the individual consumer take responsibility for the use of the substance.

    With the above being said, why not charge individuals out-of-pocket for complications related to excessive alcohol use? Responsible citizens will not be penalized for enjoying a drink now and then, and the irresponsible ones will have to fork over the cash if and when something goes awry.

  6. Dan Carbin

    This debate seems to be premised on the belief that alcohol consumption is somehow equivalent with smoking. The reality is that, for most people who choose to drink, alcohol is something that makes their lives better, not worse. Why should the majority of responsible consumers be forced to deal with state-controlled product selection, artificially high prices, and restrictive shopping hours because a minority has a problem with over consumption? Wouldn’t it be wiser and, perhaps more fair, to explore strategies that would focus on addressing the real issues related to compromised public health and safety linked to this minority?

    Maybe the “politics” of acting on this issue are so bad because the proposed approach hurts more people than it purports to help.

  7. Dani

    Where would the extra funds go? Profit to the province? Addicts will always find ways to get what they need one way or another. It’s another way to gouge the general public with a guilt trip.

  8. REV

    I’m an adult; hence, my government should not treat me like a child. There’s a distinction between social responsibility and smothering your population with policies.

    I live in a democracy; I should have a right to my personal liberties… including my vices (most especially when I partake in them responsibly).

    I live in a capitalist country; I should be entitled to competitive price points. The LCBO (the largest volume consumer of alcohol in North America) sets its prices backwards from the consumer/retail price to the manufacturer of the product. Most everyone else seeks volume discounts they pass along to the consumer. Not the LCBO.

    I live in a society that is supposed to treat everyone equally; why are federal employees and diplomats entitled to a 49% discount on their alcohol. Are they better than me? Are they less likely to addiction or poor decision making?

  9. Anand K

    Because it is up to the person how much to drink. Everyone wants freedom. Everyone should understand that Freedom comes along with responsibility. Keeping higher prices of alcohol will not solve the situation.

  10. Joe

    Why have “minimum prices”?

    It sounds like successful lobbying by the alcohol industry. They’re the benefactors of higher pricing of alcohol. With higher prices, they just spend more on marketing. Total consumption might be reduced, but is total expenditure?

    A more reasonable approach would be to increase alcohol *taxes*. Then at least the funds earned could indirectly fund the public that, instead of alcohol industry shareholders, actually faces the consequences from alcohol misuse.

  11. JMF Research BC

    Of course,the people voting no are drinkers,which is not surprising due to the amount of drinkers. No one wants to pay more for anything but when it comes to public health and safety,sorry,we can no longer allow the harm to continue,which is staggering,and we all pay for this through medical,policing,insurance and taxation.If we reduce consumption and harm,we will all be saving and a lot healthier and better off.

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