July 15, 2008

Row Over Discount Drinks After Tesco Plans Value Wines New Low-Cost Range at Odds With Scottish Government Policy


RETAIL giant Tesco has reignited the row on discounted alcohol after revealing plans that could see it selling "Value" brand wine.

The chain has admitted it is developing a wine to add to its discounted own-brand range of goods, with suggestions bottles could sell at around GBP3, cheaper than the price of a glass in many bars.

The head of Tesco's beer, wine and spirits division has claimed the chain's plans are a reaction to the credit crunch rather than any attempt to create a new alcohol price war with its rivals.

But it is certain to put it on a collision course with the Scottish Government, which has already claimed such a move "strengthens the case for government action to stamp out irresponsible promotions and pricing".

It also comes five months after Tesco, which sells around one- fifth of all alcohol in the UK, said it wanted to work with the UK Government on new laws to ensure the responsible pricing of alcohol.

The move followed widespread concern that cut-price liquor is fuelling binge-drinking and crime and just weeks after the authorities north of the border threatened minimum pricing legislation.

Tesco already has Value brand beers and spirits and believes wines are a natural extension of this.

Its rival, Sainsbury, has its own "Basics" range of wines.

Just 40per cent of all alcohol in the UK is sold in traditional outlets such as bars, restaurants and nightclubs, the majority of the rest being purchased from supermarkets.

Tesco sells a massive onethird of all off-trade alcohol.

Last month the Scottish Government launched its consultation document, Changing Scotland's Relationship With Alcohol, which could see most wines, beers and ciders rocket in price with a cost based on units of alcohol, while promotions such as three-for-two on purchases will also be banned and a "social responsibility fee" levied on retailers.

Tesco's Dan Jago said: "In the current climate it would be mad if we weren't exploring the value end as part of our ongoing review. We are inventing what our entry-level wines look like to offer the best quality and tastes that are great for the price.

"If customers say they want less expensive wines, we'll make sure we have them. Just because a customer is not paying GBP6 does not mean they don't deserve a quality wine. " But the move has been met with little enthusiasm by alcohol campaigners and the Scottish Government, keen to promote the link among cost, consumption and harm Jack Law, chief executive of leading awareness group Alcohol Focus Scotland, said "Alcohol isn't an ordinary product like bread or biscuits. It's a legal drug which causes a great deal of harm when misused.

"Alcohol should only ever be promoted on the basis of taste and quality, not price."

A Scottish Government spokeswoman said: "If this is genuinely the attitude of our largest retailer, it strengthens the case for government action to stamp out irresponsible promotions and pricing.

"Clearly the effect of a minimum price will depend on what the final figure is but high-strength, low-cost alcohol will go up most.

"We need to challenge the view that cheap alcohol is a right and to tackle Scotland's damaging bevvy culture. "

Originally published by Newsquest Media Group.

(c) 2008 Herald, The; Glasgow (UK). Provided by ProQuest Information and Learning. All rights Reserved.