Wine retailer pulls out of NT over minimum floor price
Online wine retailer Naked Wines has stopped shipping to the Northern Territory following changes to the Liquor Act.
On October 1, the Northern Territory Government introduced a minimum floor price of $1.30 per standard drink.
Under the new laws, a standard 750ml bottle of wine with 7.7 standard drinks will be sold for a minimum of $10.
Naked Wines director Mark Pollard told ABC Radio Darwin that around 600 of its customers would be affected by the decision to pull out of NT.
"The difficult thing for us is that every wine has a different alcohol level," he said.
"So you have to have a calculation on every single wine to generate a price at what you should sell that at. Obviously that's a big impost for us, so we couldn't justify spending the money.
"You never know, going forward we might be able to do something, but the pretence of our whole business is to have great wine at a great price. We just couldn't keep our promise to the customers, so we have to pull the pin."
Northern Territory Chief Minister Michael Gunner said the retailer's decision did not "make any sense".
"We know that too many Territorians experience alcohol-related crime … that's why we have a suite of measures, of which the floor price is one," he said.
"We made sure that we targeted high-volume alcohol products by having that floor price in place.
"If you're paying above $10, your bottle of wine isn't going to be affected by that floor price … so I don't understand the decision by that online retailer.
"The floor price is not a tax, like a volumetric tax. [But] that would obviously be much better policy and we want the Australian Government to do a volumetric tax."
Customer anger over minimum floor price rises
A public backlash has erupted in the Northern Territory over the introduction of a minimum floor price on alcohol.Consumers are furiously complaining that they were misled about the extent of the price rises.
The Government’s Alcohol Reform site states: “Only a very small range of alcohol drinks will have a price increase, such as cheap wine, cask wine and fortified wines. Other types won’t be affected.”
However, consumers are reporting they are now having to pay around $10 more for their favourite carton of beer.
Chief Minister Michael Gunner insists the price of beer is “essentially not affected.”
“There is a lot of beer available in the Territory … we know of three beer products that have been affected, one time we found one, so essentially beer is not affected,” he told NT News.
“But obviously there are hundreds of ranges of beer sold in the Territory. The majority of Territorians will not be affected by this at all.”
Attorney-General Natasha Fyles added: “I’ve said that before as well. It’s mainly those wines and fortified wines — but we acknowledged that there would be some beer products impacted on.”
President of the Liquor Stores Association NT, Faye Hartley said there have been many complaints from people angry over price increases.
“None of these complaints have come from the long grassers, but they are all from ordinary Territorians who are not problem drinkers,” she said. ”This is forcing the cost of living up and up. We need to be encouraging people to come here, not deterring them.
“This is just another nail in the coffin. The economy in the Northern Territory across all our stores is down 25 to 30 per cent. The value of our businesses has been halved because of everything hanging over our head from what the government intends to do from the Riley Report.
“The feedback is that they are not happy, ‘why are they getting picked on.’
“A lot are older people who are on pensions or low income and like to have an affordable wine or beer with a meal.”
Alice Springs resident Peter Ryan complained to the Centralian Advocate last week that cartons of beer he bought had gone up by $6 in a day and he was told it was due to the floor price.
Winemakers Federation declares minimum floor price "unconstitutional"
The price of wine casks has more than tripled in some cases under the new regulations.
According to Winemakers Federation of Australia CE Tony Battaglene the grey nomad trade in wine casks “will go completely” as a result of the price rises.
Two litre casks are popular with travelling seniors, a mainstay of the tourism industry in the Red Centre.
Battaglene said although the cost shift appears to possibly breach the Australian Constitution, his organisation will support the NT Government because of its “special problems” around alcohol.
“We are supporting the NT government in developing good methodology to assess its effectiveness,” he told Alice Springs News.
“We would hate to see other states bringing in a measure that is not only illegal but doesn’t work.”
Section 92 of the Australian Constitution, under the heading “Trade within the Commonwealth to be free” says: “Trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free.”
Battaglene said that while the floor price may be “problematic” under the Constitution, at this time the Federation is taking no legal action.