Licensing Act 2003 (Mandatory Licensing Conditions) Order 2010

My Lords, this order is designed to help tackle alcohol-related crime, nuisance and disorder, and to protect children as part of the Government’s wider alcohol strategy. It sets out five new mandatory licensing conditions that will apply to all those licensed to sell or supply alcohol in the "on-trade", such as pubs, bars and members’ clubs. In addition, the mandatory condition on age verification will also apply to the "off-trade", such as supermarkets, off-licences and convenience stores. These conditions have been designed to bring an end to irresponsible promotions and practices in the retailing of alcohol; to ensure higher standards across all premises; to protect children; and to give customers greater choice in the size of drinks they can buy and the option to have free tap water. By making sure that all licensed premises across England and Wales meet these minimum responsibility standards, this order will help to tackle alcohol-related crime and disorder and will make the night-time economy a safer place. The draft order sets out five new mandatory licensing conditions that will: ban irresponsible promotions; ban the dispensing of alcohol directly into the mouth; ensure that customers have access to free tap water so that they can space out their drinks and not get too intoxicated too quickly; ensure that an age verification policy is in place to prevent underage sales; and ensure that customers have the opportunity to choose small measures of beers, ciders, spirits and wine. I think there is widespread agreement that promotions such as "all you can drink for £10"; "women or under-25s drink for free"; or "speed drinking competitions" are not the types of promotions that responsible businesses should run. Opposition to the code has been raised in a debate in the other place and in the licensing trade press. I would like to take this opportunity to address some of those points so that noble Lords are clear on the content and impact of the order. The criticism has been put forward that the order is not needed and would not work. That is not the case. According to the British Crime Survey, in 2008-09 there were 973,000 alcohol-related violent offences in England and Wales. Dealing with alcohol-related crime costs society between £8 billion and £13 billion per year. Alcohol-related crime and disorder has a huge impact on local communities. The recent economic downturn has seen premises in some areas competing more aggressively with each other in order to attract customers. Often this will involve attracting customers through various forms of alcohol promotions, which encourage drunkenness and then turn the problem out on to the streets of our towns and cities, making them "no go" areas for the responsible majority of citizens who want to be there. That is why this legislation is needed—to rule out those types of irresponsible promotions and practices. The police, local councils and those working in accident and emergency departments tell us of the cost of having to deal with this problem, but simply adding more enforcement to our streets on Friday and Saturday nights is not the answer. Those selling alcohol have a responsibility here not only to their customers but to the wider communities that they are part of. Two government consultations—one in 2008 and one in 2009—have confirmed that the public, the police, and licensing authorities have strong support for this mandatory approach and the conditions outlined in the order. Will this approach work? Our consultation showed that those involved in enforcement and licensing at local level believe that this will have a positive effect and warmly support its introduction. This has been reinforced by the Association of Chief Police Officers, which has recently sent us this statement of support. I shall read it in full so that I cannot be accused of misquoting. It says: ""These conditions, if adopted, applying as they will universally, are a proportionate way forward to assist in driving up standards of trading across the sector. In reducing such headline clearly irresponsible promotions, as already mentioned, and by ensuring some of the best practice is applied across an industry sector, this mandatory code will help to create a balanced atmosphere and serve as an example to responsible drinkers going out to enjoy the highly valued sections of the entertainment economy that have alcohol as a constituent part"." In addition, we have supporting statements from individual police forces such as Nottingham and north Yorkshire. It is not just the police that support this action, the alcohol retail industry also supports it. Heineken, which operates more than 2,000 pubs in the UK and is the country’s biggest brewer, has also sounded its support. It has told us: ""Heineken UK welcomed the opportunity to participate fully in the consultation process on the Mandatory Alcohol Retailing Code. We found the Home Office to be open and responsive in taking on board industry concerns about some elements of the original draft, such as the local discretionary conditions. This partnership working approach has ensured the final version of the Code is proportionate, raising standards by banning the extreme end of promotions, such as drink all you can for £10. We do not believe this kind of deep discounting to drive footfall sits side by side with the promotion of responsible consumption"." We have similar supporting statements from other brewers—Greene King springs to mind. Heineken’s statement continued: ""We also welcome the requirement to ensure free tap water and smaller measures are available as another contribution towards making town centres and our night-time economy a welcoming environment for everyone and achieving our shared aim of reduced alcohol-related crime and health harms"." Criticism has been made of the costs attached to the introduction of the mandatory code. The £381 million figure used in the impact assessment is an estimate of the costs to businesses over a 10-year period and applies only to those who do not currently do what this order will require, so if you are running a responsible premises, offering a choice of measures and running a Challenge 21 scheme, you will not incur any new costs. Page 14 of the impact assessment sets out that the annual cost to an affected licensed premises for the first year is £703 and £544 for subsequent years. This equates to £1.92 and £1.49 per day respectively for those premises that are not already doing any of what is set out in the order. Let me be clear that these figures include the age verification condition. Data show that 68 per cent of pubs and more than 80 per cent of off-licences and supermarkets already run a Challenge 21 or Challenge 25 scheme and therefore will incur no cost by virtue of this condition. It is also important to note that not all the costs set out in the impact assessment are "real costs" in terms of money paid out by a business. The impact assessment says that, ""all cost estimates presented are economic costs and not financial costs. A large proportion of the estimated costs are due to staff abstraction from other duties, which will not necessarily have any financial impact"." A number of on-trade businesses responded to the consultation saying that complying with the mandatory conditions would cost them nothing at all as they were already meeting these conditions. This was our intention when drafting the order—namely, to target only the irresponsible minority of alcohol retailers. It is important to reiterate that alcohol-related crime and disorder cost society between £8 billion and £13 billion per year. As noble Lords will see from the draft order, the Government wish to delay the introduction of the conditions on age verification and ensuring the availability of small measures until October 2010 in order to allow businesses more time to prepare to comply with them. We are currently working with the licensed trade to make examples of suitable age verification policies available to businesses for them to use to help reduce the burden and to ensure that these policies are effective and of a good standard. I believe that this strikes the right balance between stamping out irresponsible promotions and practices in alcohol retail that contribute to crime and disorder and keeping the costs to businesses as low as possible. I beg to move.