COLES EARLY HERO IN PLONK HEALTH WAR

McLeod Shocks Plonky Lobbyists Coles Boss Raises Bottom Dollar Woollies Fosters & Lion Up Next?
by PHILIP WHITE

The wine industry stands indicted, shocked, and stone silent at the news that Coles, the huge retailer which the wine biz proudly hates for its discounting, has announced that it will dramatically raise the price of its cheap booze, starting in Alice Springs.

Coles’s savage duopolist rival, Woolworths, has indicated it will follow suit to one degree or another, and other key retailers are following these biggies.

Coles’s dramatic change comes into effect on July 1st.

This bold action by Coles managing director Ian McLeod (pictured top), follows years of intensifying lobbying by quiet and persistent original people, often senior women, and others like Russell Goldflam, Principal Legal Officer of the Alice Springs office of the Northern Territory Legal Aid Commission, Dr John Boffa, of the NT People’s Alcohol Action Committee, and one deeply troubled Lutheran pastor in The Alice, Basil Schilds.

This writer admits to having been, from afar, in there with them, and can guarantee that the ignorant hatred one can expect for taking such a stand is withering and constant. To the talkback glued-on, I have become “that posh racist wine snob bloke in bloody Adelaide who’s trying to put the price of booze up so we can’t have any.”

To the wine refinery owners, be they faceless transnationals, revered family-based companies, or indeed Woolworths itself, I am somewhere between an “idjit communiss” and a deplorable, ravaging wowser shit.

Coles’s heroic initiative flies directly in the face of keen and persistent wine industry lobbying against minimal pricing schemes proposed in turn by the health lobby. The winos also hate the excise tax which former Treasury boss Ken Henry wants government to apply to all alcohol: they spend a motza feeding slick lobbyists to fight this, although Henry's logical impost on the amount of pure alcohol in each container would equalize the tax rates across all booze, so cheap plonk gets more expensive, and expensive wine becomes less so.

The current scheme, with its totally deceptive name – the Wine Equalisation Tax - is completely, unequivocally biased in favour of the cheapest, most destructive plonk. The more effort you put into growing and making a really good clean wine, the more government will tax you. Use ridiculous amounts of irrigation water to make desert goonbag quality, three times the strength of average beer and generally full of sugar, and the government expects so little tax that you can sell this swill for less than the price of bottled water.

The old Coles/Woollies/wine industry axis has long enjoyed pumping plonk into places like the Alice at 25 cents per standard drink.

Both Prime Minister Gillard and opposition leader Mr. Abbot have been through the Red Centre lately, uttering great amounts of froth and bluster without showing the slightest hint of knowing how to fix the dread destruction that impossibly cheap alcohol wreaks in such communities.

25 cents per standard drink? Four for a dollar? You gotta be kidding.

“Coles’s action provides a model of good social policy without having to wait for government to come on board,” Rev. Schild said.

“I’m hoping the Fosters group and Lion Nathan might also be inspired to consider what positive work they could do, in particular to stop supplying those bars in Alice Springs that are open at 10AM and full by midday,” he continued.

“They cannot in good faith continue to subscribe to so-called Responsible Trading Practises and to continue to supply into those communities that are so desperately struggling with high rates of killing and addiction.

“To continue to supply into those communities is almost criminal.”

Rev. Schild knows what he’s talking about. He says of the last hundred funerals he’s conducted that two were for white people and eighty per cent involved alcohol. He cites little kids in his congregations who attend almost one funeral a month, burying friends and family who have died savagely and quickly from alcohol-related violence, or slightly less dramatically by more gradual self-inflicted alcohol damage.

Ian McLeod cites a letter Rev. Schild wrote describing his last decade in the Alice as the key factor which triggered his decision to back off with his discounting. The letter also went to Fosters, Lion Nathan and Woolworths.

“I told them that by the time those children are ten years old, some of them have been to a hundred funerals. Which is tragic, awful but very real here," Rev. Schild says.

"While in the rest of the country we talk about the gap in life expectancy between white and black being twenty years, in central Australia, that gap is actually forty years. The average age of women I conduct funerals for is thirty nine, the average age for men is about thirty seven.”

Coles will suspend its national liquor promotions in Alice Springs from July 1. Its minimum price will be $7.99 for bottled wine. It will no longer sell the popular two litre bladder packs or $2 cleanskins. Its minimum price of a standard drink of wine will be $1.14. The one litre bladders beloved by tourists will be $15, or $2 per standard drink.

In a statement that drew only disbelieving silence from the big wino lobbyists and the industry’s great councils, McLeod promised that the changes will be considered for introduction in other Australian stores "where there are sensitive community issues to manage."

Australia pays well over $15 billion a year on alcohol-related health problems and damage, much of which derives from cleanskin and bladder pack wine. Half of the wine Australia drinks is bladder pack. Half Australia’s wine comes from South Australia. The SA wine business is worth about $2 billion.

Put very roughly: $2 billion, or even $4 billion income for $15 billion loss won’t stack up in anybody’s language.

But it gets worse. Consider where the bladder packs come from. This business, and its international success, depends upon three breath-taking presumptions. One is an artificially soft Aussie dollar. That’s gone the way many of us believed it must inevitably go. Sales in the USA have withered in direct proportion to the price hike which resulted from the Aussie Dollar going back up to where it should be.

The second is a tax system biased incredibly in favour of the manufacturers of the most destructive plonk. This seems more and more tentative, especially now that Coles has admitted that some communities are better off paying more for their booze. I mean, Coles should know.

The third is an endless supply of impossibly cheap water for the irrigators of the Murray Darling Basin, where this wine is grown and made. Apart from the current deceptive flooding, which fell from the sky during the second wettest vintage in history, we know there is not enough water in the system to keep supplying this business in the way it would prefer.

There are entire communities from Blanchetown to Burke which are suffering disgusting economic, social and mental damage because they cannot continue to make a living attempting to supply transnational wine refineries, who supply Coles and Woolworths with cleanskins those retailers can profit on at $2 a bottle, or bladder packs to match.

This situation, where businesses profit from destroying communities in the Murray-Darling Basin by determinedly producing rotgut which we then tip into the people of the dry river beds around The Alice, where it kills them, is increasingly unlikely to survive.

Add the $15 billion worth of alcohol-derived public health damage to the total cost of fixing the human and environmental destruction along the Murray-Darling, and you’ll have a very big number indeed.

If the brave and surprising Mr McLeod can see that his policies are destroying one end of the equation, it cannot be long before he starts to think about the destruction wrought at the other end: the source.



STOP PRESS:

Alice Springs Council now opposes Coles/Woolworths attempt to alleviate the Red Center's alcohol horror: http://www.smh.com.au/national/alice-springs-council-protests-against-cheap-alcohol-ban-in-woolworths-and-coles-20110628-1gp5a.html

Murray-Darling wine councils in dire financial crisis: http://www.weeklytimesnow.com.au/article/2011/06/29/351141_horticulture.html

More growers quit along the River:
http://www.abc.net.au/rural/news/content/201106/s3255402.htm
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