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Tesco wants talks on tackling cheap alcohol

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21/02/2008 15:59

By Peter Griffiths

LONDON (Reuters) - Tesco said on Thursday that it wants to work with the government to limit the sale of cut-price alcohol, amid growing concerns over the damage binge drinking does to society.

Britain’s biggest supermarket chain said it could be accused of breaking competition rules unless ministers change the law to allow higher alcohol prices to be fixed.

Tesco’s Lucy Neville-Rolfe, executive director for corporate and legal affairs, said the changes must apply to all retailers, or shoppers would simply go to cheaper outlets.

"All shops that sell alcohol need to act together -- and this is where we are being held back by the law," she said in a statement. "Competition law prevents businesses discussing anything to do with price with each other.

"The only safe solution is for the government to initiate and lead these discussions."

Supermarkets have come under intense pressure from police, doctors and politicians to raise prices.

They say cheap alcohol fuels youth crime and anti-social behaviour and places a huge strain on the National Health Service and police.

Labour MP for Selby John Grogan described Tesco boss Terry Leahy last year as the "godfather of British binge drinking".

A report last month said beer was cheaper than water in some stores.

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Public Health Minister Dawn Primarolo welcomed Tesco’s commitment to work with the government and said it had ordered a review into alcohol prices and their impact on drink problems.

"It is vital that we understand which supermarket practices really impact on harmful drinking and which are simply helping hard-pressed family budgets," she said in a statement.

Prime Minister Gordon Brown’s spokesman said a review of the impact of alcohol on health, policing and local councils was due to report shortly.

A spokesman for the Department for Business, Enterprise and Regulatory Reform said: "Any action related to alcohol pricing or price promotions would require legislation and we are currently considering a number of options."

(Additional reporting by Katherine Baldwin)

(Editing by Steve Addison)