Letter to the Chancellor: Raise alcohol duty in Budget 2020

Ahead of Budget 2020, the Alcohol Health Alliance has written to Chancellor Sajid Javid to ask him to raise alcohol duty 2% above inflation in order to reduce health inequalities and raise revenue for public services.

28 January 2020

Dear Mr Javid,

I am writing as chair of the Alcohol Health Alliance UK, a broad coalition of health organisations and charities united in their support of evidence-based alcohol policy. We are calling for a 2% increase in alcohol duty above the retail price index in the March Budget. This would be an effective way to support the government’s objectives: it would reduce health inequalities, cut harmful drinking and boost economic productivity, all while simultaneously raising revenue to invest in our public services.

Currently, some of the most vulnerable in our society are being left behind: Public Health England estimate that only one in five people who need alcohol treatment are receiving specialist support. Budget constraints have put public health services, including alcohol treatment, under significant strain. At the same time, the Government has been losing out on more than £1.2 billion in forgone revenue in 2019/20 alone, due to the cuts and freezes since 2012. £1.2 billion would be enough to pay the salaries of 40,000 nurses. By 2022/23, the cumulative cost of the duty cuts will exceed £9 billion.

Concurrently, research from the University of Sheffield has shown that the changes in alcohol duty since 2012 have led to nearly 2,000 additional deaths and 61,000 hospital admissions in England. This is not only an enormous human cost, but also strains our public services by adding an estimated £317 million to NHS England’s bill. Moreover, the duty changes have cost English businesses £58 million in lost working days since 2012.

The harms from alcohol do not fall evenly across the UK: the North of England has significantly higher rates of alcohol-related deaths than London or the South East. Increasing alcohol taxes is a highly effective way of reducing alcohol harm. In fact, it is amongst the three ‘best-buys’ from the World Health Organization: policies with the greatest return on investment for tackling alcohol harm. The public broadly agrees with the measure: 1 in 4 people believe that alcohol duty is currently too low, whereas only 1 in 7 think it is too high. People are particularly supportive of increasing alcohol duty if the money is to be spent on services impacted by alcohol use, with the proportion in favour rising to 52%.

Finally, cutting duty is of little benefit to pubs. Ending the alcohol duty escalator in 2013, and the subsequent duty cuts and freezes, has made no measurable difference to the rate of pub closures. This reflects the experiences of those working in the pub trade: nearly 90% of publicans in the North East said that duty cuts had not had a positive effect on their business. Less than 5% felt that alcohol taxes were the main cause of pub closures, while a majority thought that cheap alcohol from supermarkets and off-licenses was to blame.

I would be grateful for the opportunity to meet with you to discuss the importance of raising alcohol duty. If your office could contact me on the address above with suggested dates, we can arrange a meeting at a mutually convenient time.

Yours sincerely,

Professor Sir Ian Gilmore

Chair, Alcohol Health Alliance UK