Resources » National Alcohol Strategy - Consultation Draft » What is Minimum Unit (Floor) Pricing?

What is Minimum Unit (Floor) Pricing?

The anti-alcohol lobby constantly calls for introduction of minimum pricing or a floor price on alcohol. They claim it will reduce harmful alcohol consumption. However, it does not target risky drinkers because they are more prevalent in higher socio-economic groups[1] and it increases costs for all low socio-economic consumers, regardless of their consumption patterns.

A floor price relies on price restrictions alone as the sole deterrent to address risky drinking. It does not target the causal reasons for that behaviour.  

What is minimum pricing or a floor price?

A floor price can be legislated by a State or Territory Government so that alcohol products cannot be sold at a price lower than a stated value per unit of alcohol. For example, no lower than $1.30 per standard drink as announced by the NT Government in February 2018.

A $1.30/unit floor price would increase the price of a 4 litre cask of red wine by nearly 300 percent to approximately $56.00. An average bottle of white wine could not be sold for less than approximately $9.75.

What is WFA’s position?

WFA does not support a floor price as a tool to reduce harmful consumption because it does not target those drinking at risky levels

-        it unfairly increases costs for all people in the lowest socio-economic groups even if they are drinking moderately

-        people in higher socio-economic groups are more likely to exceed lifetime risky drinking guidelines and single occasion risky drinking guidelines, than those in lower socio-economic groups[2]

-        a floor price significantly increases the profits for retailers, with no additional revenue for other targeted Government health programs

-        moderate drinkers are more likely to reduce consumption in response to price changes than risky drinkers[3]

-        a recent WA study found the attitudes of the public towards minimum pricing was negative, believing it would lead to increased crime, was unfair on disadvantaged groups and would not stop individuals drinking[4].

How might it affect Australia’s wine industry?

The viability and profitability of a significant part of Australia’s wine industry depends on providing a range of products at a range of price points. The option to provide grapes and wine for a large volume market is critical to the sustainability of many wine businesses.

Where is minimum pricing being implemented?

Northern Territory - The NT Government announced it would implement a $1.30 per standard drink minimum price from 1 July 2018.  

Western Australia - The WA Health Minister, Roger Cook, has previously stated he is in favour of considering introduction of a floor price. The February 2018 revisions to the WA Liquor Control Act did not include a floor price. 

 



[1] Harris,B, Fetherston, H & Calder,R. Australia’s Health Tracker by Socio-economic status 2017, Australian Health Policy Collaboration, Melbourne, Victoria University, November 2017.

[2] Australian Institute of Health and Welfare 2017. National Drug Strategy Household Survey 2016: detailed findings. Drug Statistics series no. 31. Cat. no. PHE 214. Canberra: AIHW.

[3] Crampton, E., ‘Increasing alcohol excise is great, if you assume the right things’, April 25 2014, http://offsettingbehaviour.blogspot.com.au/2014/04/increasing-alcohol-excise-is-great-if.html

[4] Keatley D, Hardcastle S, Carragher N, Chikritzhs T, Daube M, Lonsdale A, Hagger M: Attitudes and beliefs towards alcohol minimum pricing in Western Australia 2016