HOSPITALITY ASSOCIATION OF NEW ZEALAND

Submission by
Hospitality Association of New Zealand
to the

Ministry of Justice

on the

Review of the Sale and Supply of Liquor to Minors

11 June 2007

Hospitality Association of New Zealand
Level 2, Radio Network House
Corner Abel Smith and Taranaki Streets
PO Box 503, Wellington
Phone: 04 385 1369
Fax: 04 384 8044
www.hanz.org.nz

Introduction
The Hospitality Association of New Zealand (HANZ) represents in excess of 2,300 members, almost all of whom have a liquor licence and are engaged in the sale of liquor. The Association’s membership has a high focus on the on-premise consumption of liquor and represents a significant proportion of the on-licences providing the 30% of liquor consumed on-premise in New Zealand.

The Association appreciates that the major driver of this review is targeting the sale and supply of liquor to those under the age of 18. It also recognises that there is the opportunity to address other issues relating to the sale of liquor as per the previous targeted review of the Sale of Liquor Act and for ease of reference enclosed is the Association’s submission to the targeted review of the Act. The following is a summary of the Association’s suggested initiatives. The Association is happy to provide more detail and input should this be required.

Drinking Age
There is a misconception amongst many New Zealanders that there is currently in place a drinking age set at 18 years in 2006. Parliament decided against increasing the age of purchase from 18 to 20. However the Association believes that if New Zealand is to address the issue of those under the age of 18 drinking, and drinking to excess, then it is time for an informed and rigorous debate on whether a drinking age of 18 should apply. A drinking age would make it illegal for anyone under the age of 18 to purchase or consume liquor. We would suggest there should however be an exception where liquor is supplied by a parent, but where such liquor was supplied then that parent should be held responsible and accountable for any consequences of consumption of liquor by their child or children.

Changing the age of purchase of liquor does nothing to address New Zealand’s drinking culture. Making it illegal for those under the age of 18 to consume except when being supervised by their parents however would send a very strong signal against a youth drinking culture.

Intoxication in Public an Offence
A key issue of concern is New Zealand’s culture of binge drinking and this applies to both adults and to minors. ALAC have repeatedly noted that drinking behaviour among young persons simply reflects adult norms. The Association believes that a strong signal needs to be sent to all New Zealanders that becoming intoxicated is not acceptable. Currently the only offences around intoxication are where operators of licensed premises, including licensees, managers (and in some situations servers), sell or supply liquor to an intoxicated person (Section 166), allow a person to become intoxicated on licensed premises (Section 167) or allow drunkenness or disorderly conduct on licensed premises (Section 168) and allow intoxicated persons to be or to remain on licensed premises. The offences under Sections 167 and 168 of the Sale of Liquor Act however place liability on licensees and managers of premises. The Association believes that it should be made an offence to be intoxicated in a public place and on licensed premises. This would send a very clear and powerful message to all New Zealanders that intoxication wherever it occurs is unacceptable.

It has been suggested that intoxication is too difficult to define to make an offence for anyone else other than operators of licensed premises. The Association submits most strongly that in an environment where the operators of licensed premises are required by the Sale of Liquor Act to refuse entry and service to intoxicated patrons and this law is enforced by Police and District Licensing Agency Inspectors that this challenge should not preclude intoxication being made an offence for the individual.

Furthermore, the Police Alcolink programme has in recent years facilitated Police personnel being trained in assessing and recording the level to which offenders and victims of crime are affected by liquor. Consequently it should not be difficult to enforce an offence of intoxication.

The Association contends that the current environment where operators of licensed premises are solely responsible for preventing members of the public becoming intoxicated without any penalty for the individual to reinforce or assist this is ineffective and unbalanced. Until the public at large are confronted with some significant and immediate consequences for their state of intoxication it will remain an acceptable norm within society.

Successful strategies in the areas of drink driving, speeding and seat belt wearing have all included individuals receiving penalties alongside strong social marketing campaigns. The Association does not believe that even the best social marketing campaign can achieve substantive change in behaviour toward excess liquor consumption and intoxication in isolation.

Prohibition on the advertising of price
The advent of supermarkets using liquor as a “loss leader”, whereby liquor is sold below cost price to attract shoppers who will purchase other items alongside liquor, has contributed significantly to the availability and supply of liquor to minors. The Association is advocating that the use of price be prohibited in all forms of liquor advertising. Without the ability for liquor retailers to use price as a marketing tool it would be anticipated that the price of liquor products would rise. It is recommended that this prohibition apply to both on and off-licences with any price promotions being limited to on-premise or in store.

The Association believes that such a measure would result in increased prices without the heavy handed, blunt and ineffective intervention of increased excise tax or a minimum pricing regime.

Excise Tax
The Association does not support the use of increased excise tax as a means of limiting access of liquor to minors. The history of excise tax increases over the last decade has seen supermarkets discount to the same level as the increases and/or suppliers absorb those increases. Consequently the actual price of liquor in the off-premise sector has not impacted on the retail price to the consumer. Meantime, on-premise pricing has continued to rise creating an ever increasing differential between the price of liquor on-premise versus the price of takeaway liquor from a supermarket or liquor store. Any use of across the board excise tax increases will only further exacerbate this trend which is driving people to drink away from a supervised environment to drink at home in unsupervised settings or public places. A decade ago an estimated 40% of liquor was consumed on licensed premises with the remaining 60% consumed elsewhere. This has now shifted to approximately 30% on licensed premises and 70% elsewhere. The Association does not believe that current policy initiatives that continue to drive this trend are helpful in improving New Zealand’s drinking culture.

It is similarly suggested that a minimum price regime could be introduced. The Association has some concerns that a minimum pricing regime would be complex and bureaucratic to operate. However if it was to be given serious consideration then the Association believes that it should only apply to off-licence sales.

Making False Representation to a Licensee – Use of False ID
The Association strongly supports the extension of legislation around the use of liquor infringement offence notices under Section 162 of the Sale of Liquor Act – any person under the age of 18 who purchases liquor on or from licensed premises, and Section 163 – any person under the age of 18 who is found on any restricted area of any licensed premises or a supervised area without that person’s parent or guardian to include Section 172 – making false representation to licensees and managers of licensed premises. The industry is constantly under attack from young people endeavouring to access liquor from licensed premises and it seems there is little policing or penalties applied to those minors seeking to access liquor illegally and consequently putting at risk the businesses of hospitality operators. The Association believes it is time to send a strong signal to young people that endeavouring to access liquor illegally through making false representations including using someone else’s identification or false identification will be punished in an immediate and appropriate way. The Association has previously submitted on this issue in the attached document.

Moratorium on new Liquor Licences
The Association is concerned that the unlimited number of liquor licences currently available has created an environment of intense competition and extremely competitive pricing. It has been suggested by some that the number of liquor licences should be limited. The Association would support a moratorium on the issuing of new liquor licences with the proviso that existing licences are able to be traded, with the buyer of the liquor licence meeting the requirements of the holder of the liquor licence.

Conclusion
The Association is happy to work with the Steering Committee to work through the detail of the suggestions above to ensure their design is practical and achieves the required objectives.