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Whyte and Mackay warn minimum pricing will "decimate" Scotch whisky industry

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Published Date: 10 March 2010
WHISKY giant Whyte and Mackay today warned that the Scottish Government's minimum pricing policy will lead to job losses.



The Glasgow-based company's managing director John Beard will face questions from Holyrood's Health committee today.

His submission to the panel warns that the proposal would "decimate" the Scottish whisky industry and would lead to the closure of the firm's bottling plant in Fife

The submission states: "We anticipate that our bottling plant in Grangemouth, which employs 200 people, would close.

"Our production levels would also be affected, so there would be a knock-on effect at our distilleries. Our best estimate is that another 100 jobs would be at risk.

"This will lead to significant job losses at Whyte and Mackay, across our distilleries, our bottling plant and our distribution centres.

"Whyte and Mackay, a company established in 1844, would essentially cease to exist in anything but name only."

Members of the Health Committee are considering proposals put forward by ministers to tackle Scotland's drink problem.

They will question Mr Beard on the issue this morning.

In his submission to the committee, Mr Beard said the firm was the leading supplier of own label whisky and added: "From our company perspective, we have no doubt that minimum pricing will decimate the own label market.

Mr Beard argued that a minimum price of 50p per unit could mean that own label whiskies would be in the same price range as brands such as Famous Grouse and Bell's and added: "That being the case, the role and need for own label products disappears altogether.

"As the leading supplier of own label whisky, this would be disastrous for our business."

The Scottish Government wants to introduce minimum pricing in its Alcohol Bill, currently going through Holyrood.

A figure of 40p per unit of alcohol has been used to illustrate what is possible, with a study by Sheffield University academics suggesting hundreds of lives could be saved, along with reductions in crime and alcohol-related illnesses.





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  • Last Updated: 10 March 2010 12:18 PM
  • Source: scotsman.com
  • Location: Scotland
  • Related Topics: Scotsman Whisky
 
1

Jo Public,

10/03/2010 12:39:07
#1. And the wee twitcherer Gray will continue to defy his lords and masters in the Big Smoke by resisting changes to minimum pricing, preferring, as he and his bunch of loonies obviously do, that the country continue to drink themselves into oblivion and vote Lyebour.
2

The west awake,

Argyll 10/03/2010 12:40:25
This appears to be scaremongery to me, in any case, most experts seem to agree this is a great idea to help Scotland end its tragic love affair with the bevvy, so we must be prepared for consequences.
Lets face it, the same was said about the tobacco industry AND stopping smoking in pubs, it was right then and this is right now.

Bold action from the SNP which should be supported by all responsible opposition parties, (Greens then). No doubt the charismatic Ian Gray will soon be carping as usual...

3

M78,

Tain 10/03/2010 12:43:08
No doubt the clowns are quick off the mark today, just have a read of the Telegraph before you come out with such tripe.
ALISTAIR DARLING, not wee Eck is alleged to be considering an £8 ,yes £8 hike on a bottle of spirits.Wonder what Elmer will make of that!
4

Grahamski,

Falkirk 10/03/2010 13:04:48
To suggest there will be no impact on jobs from the Scottish Executive's plans is naive.

Personally I don't think a minimum per unit policy is the best way to combat alcohol abuse in our country.

It is also becoming obvious that the EU will rule against this policy.

5

GenePoolDebtCrises,

10/03/2010 13:04:50
Ah the Labour Party scaremongering again! So nothing new! Wonder what Flipper has in store for us at the budget!
Have Diageo not already closed a bottling plant and that is without minimum pricing so I reason that the decision about whether or not to close bottling plants has nothing to do with pricing policy! But then the Labour Party in London seem to considering a minimum pricing policy. Grey will have to come into line with his bosses!

6

Iain Mac,

10/03/2010 13:06:43
#4 - aye, true, the Westminster govt has been responsible for the crippling whisky taxes for decades. W&M would do better to go there and complain. From what i understand, malt whisky at least is already so expensive that it wouldn't be affected by minimum pricing.

Maybe a tax-cut from London is what's needed for whisky?
7

Iain Mac,

10/03/2010 13:08:12
#5 - ~Grahamski, so why then have successive London govts - both Tory and Labour - persisted with crippling taxes on high-strength alcohol such as whisky?

If pricing doesn't work, surely we need to take our arguments to London first?
8

Grahamski,

Falkirk 10/03/2010 13:12:03
6

"Ah the Labour Party scaremongering again!"

Whyte & MacKay actually.

"But then the Labour Party in London seem to considering a minimum pricing policy"

Considered it and rejected it - it's against EU regulations for a start.

7.

"malt whisky at least is already so expensive that it wouldn't be affected by minimum pricing"

True. W & M however produce supermarket 'own brand' whisky which under the Scottish Executive crazy-daisy plans will cost as much as malt whisky - so making the 'own brand' whisky no cheaper then premium brands.
9

Huntly loon,

Aberdeenshire 10/03/2010 13:13:24
Whyte & Mackay are miffed by the prospect of minimum unit pricing because they have tied up the suupermarket own brands market. They say that they would have to charge premium brand prices under minimum pricing. What they really are saying is we want to maintain our market share by undercutting our rivals. They say they would have to close a bottling plant but can we believe that it exists only to bottle the Scottish supermarket requirements, or is it used to bottle whisky for the rest of the UK market nad their own premium brand. This is scaremongering of the worst kind, but it is what we would expect any business to do. Does W&McK not think their product can stand up to the Bells, Teacher's or Grouse on the supermarket shelves?
10

Jo Public,

10/03/2010 13:14:19
#5 Mrs Graham

"Personally I don't think a minimum per unit policy is the best way to combat alcohol abuse in our country"

And your solution is???
11

Jo Public,

10/03/2010 13:16:01
Anyway, Whyte and macKay are owned by an Indian businessman are they not, and you can see these jobs going over there, whilst we stand back powerless.

Just like everything else.
12

Huntly loon,

Aberdeenshire 10/03/2010 13:17:36
Grahamski you are being disingenuous. Minimum pricing blends will always be cheaper than malts. It is the own brands against the other blends that is the matter in point. The major blends e.g. Bells, Grouse or Teachers would be unaffected as they already sell at the expected 40p a unit price.
13

peter1958,

The Office, Glasgow 10/03/2010 13:18:40
Grahamski is spot on as usual.
The "experts" in this case appear to be exclusively of the SNP variety.

The debate this morning on Radio Scotland rehearsed both sides of the argument for and against and I noted the good Dr from Dundee supporting minimum pricing was pretty well reduced to arguing "we have to start somewhere" .

I'm of the view minimum pricing is not the "somewhere" we should start from.

Where I think we can start in changing attitudes is much closer to home, for example, banning the intake and purchase of alcohol on government premises or during the working time associated with any government department.

Or simply refusing all expenses claims that include purchases related to alcohol.

Or maybe even getting members of the Scottish Parliament and the SNP to sign the pledge, introducing compulsory testing and instant dismissal for those found partaking of any alcohol.

There is a part of me now of the view that Sturgeon is simply envious of McConnell's smoking ban and she hopes to emulate this success with alcohol.

She has simply scuppered all those fine attempts by the SNP to develop positive links with the Scotch Whisky Association - and the funding that goes with it!
14

Grahamski,

Falkirk 10/03/2010 13:19:22
13

Mr Loon,

You're right, I typed 'malyt' when I should have typed 'premium brands'. Apologies.
15

peter1958,

Glasgow 10/03/2010 13:21:31
By the way, what if a minimum price of 40p or 50p does not bring the benefits Sturgeon anticipates. What is the ceiling limit? Or is it a case of "it takes what it takes"?
16

El Franko,

10/03/2010 13:26:27
It is all but axiomatic that when governments interfere with prices, they will only do harm. The leftie obsession with good intentions seems to blind them to harmful consequences. As well as a loss of jobs in the whisky industry, I expect there will be an increase in moonshine production. I imagine also that the hideous EU will want to have its say, and may even wish to impose a fine. Meantime, smuggling across the border will no doubt rise, as will heavy boozing in other than licensed premises.
17

peter1958,

Glasgow 10/03/2010 13:27:18
Next up, obesity - minimum pricing of fatty foods and takeaway substances.
18

Grahamski,

Falkirk 10/03/2010 13:32:14
16

Peter,

"By the way, what if a minimum price of 40p or 50p does not bring the benefits Sturgeon anticipates."

And let's face it, there is no real evidence to suggest that it will work. The Sheffied study is a mathematical model only - the only study done on real people was a study on an aboriginal settlement in Austrralia which provided inconclusive evidence.

There's lots of big ifs and buts here. Meanwhile can we stand having our first minister standing outside various bottling plants shouting his mouth off?
19

go boil ur heid,

10/03/2010 13:33:43
Will the government's who are in favour of minimum pricing do anything to help the victim's of this idiotic policy

The families of drunk's will be deprived even more of their basic need's in the pursuit of drink.

Anyone who say's higher price's will lead to better health does not know anyone will a drink problem.

I Really do think these overpaid and underbrained politition's should think outside the box when coming up with these idiotic policies.
20

peter1958,

Glasgow 10/03/2010 13:43:39
#20. I know. It makes me choke with rage.
A close friend of mine is a support worker for residential care of alcoholics and drug addicts - not Peebleshire I assure you. He was ecstatic at the SNP decision to increase spending on drug and drink rehab - a decision we all applaud by the way. One up to the SNP in my view!

He now tells me that in the 2 years since the increase in funding was announced not a single penny piece has made its way to his own charity funded establishment and they have about three months finance left before they go bust.

The money must be being either spent on yet more experts and studies or allocated by local authorities to other projects disassociated with rehab provision.

Something does indeed have to be done. Ensuring more money is spent on drink is not the answer though. Addicts will sacrifice everything to their addiction and minimum pricing is not my idea of OUTREACH work at all.
21

Old Jim,

Aberdeen 10/03/2010 13:47:37
'Whyte and Mackay warn minimum pricing will "decimate" Scotch whisky industry'
No it wont!
What will is the £ 8 a bottle Tax hike that Darling is planning to introduce in the Budget
22

Old Jim,

Aberdeen 10/03/2010 13:50:10
Its quite funny but the Americans are actually planning minimum pricing on soft drinks, such as Coke and Pepsi, due to the obesity thats rife in the US
The connection is of course Health issues
23

Corky,

10/03/2010 13:56:39
The biggest issue is cultural - there is a culture of alcohol abuse in our country and it's that which is at the root of the problem. Peter's comments at #14 are spot on.

I, for one, am fed up with the 'ban it' mentality and want to see more emphasis on individual responsibility and the morals of the situation.

Otherwise, how is it that other countries, where alcohol is cheaper, they don't have the same problems?

Thw problem for W&M is that their business has a concentration in less expensive brands sold in the UK market where price sensitivity is a major issue. Also, describing them as a 'giant' is wrong, they are at the top of the second division in terms of whisky production and sales.

The real giants, Diageo et al, sell over 90% abroad and would not be as affected as W&M. So it's hardly surprising that W&M are shouting loudest!

24

Scorpion54,

Penicuik 10/03/2010 14:13:39
#22 Can you please provide us with a link showing where Darling tells us that he is going to increase the tax on whisky by £8.
25

Gruntfuttock,

10/03/2010 14:51:41
We are constantly told about the evidence that minimum pricing reduces alcohol consumption but what precisely is this evidence? There is no doubt that price and alcohol consumption are linked but almost all studies that have been conducted to date focus upon taxation. As far as I am aware the only study that investigated minimum pricing was conducted in Tasmania on (wait for it) Aboriginals. One constant feature in all studies, however is that countries/regions where there is a tradition of distillation of spirits have abnormally high alcohol-related problems; this is not the case in countries that are traditionally wine making. The massage is clear here- the Scottish Government must stop promoting the Scotch Whisky industry which arguably has done more damage to they health and well-being of our nation than heroin.
26

peter1958,

Glasgow 10/03/2010 14:56:19
Strange how Angus Robertson MP is utterly mute on this topic?

Surely as the Vice-Chairman of the All-Party Parliamentary Scotch Whisky Industry Group he would be the first to defend W&M?
27

Calum Crubag,

10/03/2010 15:42:07
#19 Grahmski - obviously Westminster think taxing drink works or otherwise there wouldn't be punitive taxes on all strong drink - vodka, whisky and other spirits.

I wonder why more people dont drive Rolls Royce - is it a 'cultural' thing? Or a price thing? And isn't cost a good way of changing 'culture'?

A lot of 'culture' comes from economic necessity - eating tatties, the types of song we sing etc...
28

Calum Crubag,

10/03/2010 15:45:22
So Corky, end all drug laws and promote 'morality'? I might agree with you here. Maybe we should scrap the murder laws and just 'teach' that its wrong to kill others? Oh, we know that already...

But, who dictates the morality? In native South American tribes, eating coco leaves is morally acceptable. In our culture, some drugs are and others aren't. In the Catholic church, the pill was ok until a cabal of men dictated that it's use was contrary to Biblical teaching.

And, how do you change 'culture'? Anyone?
29

Charles Linskaill,

Edinburgh 10/03/2010 15:46:22
Government will not rest until our whisky is doubled in price, 'of-course' our Scottish Whisky Industry will be "decimated"!!
30

,

10/03/2010 15:54:37
Comment Removed By Administrator
Reason:
31

Corky,

10/03/2010 16:02:11
28 Calum Crubag,

You are wrong - they tax it highly because they know it a good source of revenue.

This is proven by the fact that the level is set to maximize income for the treasury - if it were set too high then consumption would fall to the point of diminishing returns.

You really do post some claptrap.
32

Corky,

10/03/2010 16:05:10
29 Calum Crubag,

More claptrap - the first moderator of behaviour is indeed morality.

Personally I don't steal, murder or commit crimes because I fear punishment - it's because I know it's wrong to do so.

Presumably your behaviour is only moderated by the fear of punishment and not morals?

And how do you manage to weave religion into this? You are obsessed with it aren't you?
33

,

10/03/2010 16:18:36
Comment Removed By Administrator
Reason:
34

Calum Crubag,

10/03/2010 17:00:15
Corky - so let's abandon all laws and just instill 'morality'?

As to morals, why do you get so abusive in your posts? I've seen it aimed at others too. If you keep losing it here, best to keep off the forums.
35

Calum Crubag,

10/03/2010 17:02:40
Quote:
This is proven by the fact that the level is set to maximize income for the treasury - if it were set too high then consumption would fall to the point of diminishing returns.


So - legalise cannibis and make the govt some dosh?

And cigarettes?

And do car-buyers buy the same amount of Skodas as they do Rolls?
36

Brian M,

10/03/2010 17:13:56
If they decide to close then so be it, no doubt they will make from it anyway
37

Corky,

10/03/2010 18:09:27
Crubag,

N,o we can't abandon laws and instil morality - because sadly there's too few folk like me and too many folk like you.

Abusive - don't make me larf - you are sooooo disrespectful of others that you've got it coming.

btw - I ain't losing anything.

Legalizing cannabis is indeed an option - not one I think this Govt will take - although you are right it could be used to raise revenue.

Cigarettes are legal already - you nitwit! and the excise duty is very high too - about 26%.

There's not enough Rollers sold to justify a high tax rate - doh!

Calum - sometimes your posts are quite smart - other times it's like you don't engage the brain cells first.

38

wild wadi,

Kirkie 10/03/2010 18:27:09
I go along with the "Rolls Royce" argument.

If a ten grand Clio was taxed 1000% then yes we'd all be driving rollers therefore sales of rollers would go up.

Same goes for cheap booze. If it becomes the same price as quality booze obviously we'll all be drinking that. Therefore sales of quality booze goes up.
39

Marian,

10/03/2010 20:22:50
It appears that Whyte and Mackay were being less than honest in their claim for the BBC is now running a story athttp://news.bbc.co.uk/1/hi/scotland/8558421.stm that states Whyte and Mackay have now been forced to apologise to the Scots government for making a misleading claim as described in this article.

It appears Whyte and Mackay's claim of job losses was erroneously based on the assumptions that (a) the minimum price policy would be applied UK wide when the Scots government's proposals only apply to Scotland, and (b) the minimum price would be 50p per unit and not 40p as proposed by the Scots government.

It appears that Health Secretary Nicola Sturgeon took issue with Whyte and Mackay and that has forced them to back down.
40

Terrier2,

10/03/2010 21:08:54
All of this is irrelevent, not only is it a stupid policy as Peter1958 has put so well - they are wasting taxpayers money by even discussing it. The will of Hollyrood and Westminster do not matter, Brussels will stop this (until they can introduce minimum pricing law of their own).
41

The west awake,

Argyll 10/03/2010 21:52:26
Another whitewash - " almost everyone I know now dislikes the SNP even more than labour"

Really? what's that then... 3 of your mates plus your Granny?

Please try to keep the debate up to at least minimum standards!
42

Louis Catorze,

10/03/2010 22:13:32
"...lead to the closure of the firm's bottling plant in Fife..."

Michty me...they've gone and moved Grangemouth!

That's the real news here....
43

john z,

edinburgh 10/03/2010 23:18:08
40 Marion,

You are quite correct. Whyte and Mackay have now apologised for their potentially misleading statements on job losses.

The 300 job lossses they described would only happen if minimum pricing were adopted across the entire UK. In addition, their calculations depended upon a minimum unit price of 50p.

So, to summarise;

no 300 job losses

no bottling plant closure

an apology from Whyte and Mackay.

The spokesperson from Whyte and Mackay said

QUOTE: "Certainly from the point of view of communicating the job numbers, we certainly didn't set out to mislead anybody - if that is the case I can only apologise."


Nice to get the facts at last.
44

john z,

edinburgh 10/03/2010 23:20:12
The article on BBC is at;
http://news.bbc.co.uk/1/hi/scotland/8558421.stm
45

john z,

edinburgh 10/03/2010 23:27:18
31

The SNP Government of Scotland could not change the council tax system, because the unionista parties (lib dem, labour and tories) all opposed it.

You cannot blame the SNP for the stupidity of london labour and the tories.

Oh, and the Government policy is for minimum pricing, so your statement that the Government will 'up' the price of all alcohol is just a lie.

 

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