Whyte and Mackay: Minimum pricing could force us to cut 300 jobs

STV

Leading whisky maker Whyte and Mackay has warned that Government plans to introduce a minimum price for alcohol could force it to cut 300 jobs and close its bottling plant in Grangemouth.

The drinks manufacturer's chief executive, John Beard, told Holyrood's Health Committee on Wednesday the controversial proposal could also leave the firm with no choice but to cut jobs at its main grain distillary near Inverness.

The Scotch Whisky Association also hit out against the measure, raising fears the whisky industry could lose £600 million of exports.

Bosses at Whyte and Mackay say introducing a minimum price per unit of alcohol could "decimate" the market for own brand whisky, with Mr Beard warning supermarket own brand whiskies could be removed from the shelves.

As well as producing famous brands such as Bell's, his firm is the "leading player" in the own brand whisky market. Mr Beard said raising the price of those products would leave them unable to compete with premium brands, adding the proposal would have a "serious impact" on the firm, which employs 480 people.

In a submission to the committee, Mr Beard said he accepted Scotland had "chronic issues relating to alcohol", however, he added: "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."

Tory MSP Mary Scanlon pressed him on the job losses, saying: "Is this an exaggeration to lose 300 jobs or is that a reality?"

Mr Beard said the figures were based on the impact of a minimum price of 50 pence a unit, while a figure of 40p per unit has previously been used to illustrate the impact of minimum pricing. However, he pointed out that the Bill does not contain an explicit figure for what the minimum price would be. He said a 50p figure would mean the price of own brand whisky rising from £10.18 to £14, making the cost comparable to many leading brands.

He added: "The own label we supply is excellent quality but I would argue that consumers, given the choice of a leading brand at £14 or an own label at £14, arguably would choose the brand.

"Indeed I think retailers won't give them that option. My suggestion is they would probably delist these products totally."

Mr Beard said it was a minority of people who abused alcohol and added that with proposals for minimum pricing, "we're trying to solve it by a sledgehammer for the majority".

IN DETAIL

Bob Price, of the National Association of Cider Makers, added that minimum pricing could have an impact on jobs in England and Wales, where cider is made.

He told the committee: "The cider industry is predominantly an English industry and there are operations in Wales.

"So, from a Scottish perspective, if you introduced a minimum price you won`t actually lose jobs in Scotland, the impact would be across the border in England and Wales."

Meanwhile, Gavin Hewitt, of the Scotch Whisky Association, argued minimum pricing could pave the way for other countries bringing in measures that would "discriminate" against Scotch.

He said: "We believe that the consequences of a Scottish precedent, which would overturn all the rules that are currently in place now, would be used by markets overseas to try to protect their domestic market at the expense of Scotch whisky. Our calculation is £600 million of exports lost in one year."

Mr Hewitt said that 80% of the alcohol consumed was drunk by just 30% of people and argued: "We need to address harm, we need to get at that 30% and minimum pricing may not be the answer to address that."

However, Mike Lees, the managing director of Tennent Caledonian Breweries, argued minimum pricing had a role to play. Tennent's has already given its backing to minimum pricing and Mr Lees said: "We`re committed to Scotland and want to welcome sensible moves to ensure that alcohol is enjoyed appropriately."