Ireland 'not hit by ban'
According to research conducted by business consultancy CIL, the negative impact of the Irish smoking ban has been dramatically over-played as the trade tried to explain why business was declining.
The company has closely monitored the market over the last 18 months in a bid to show how trade had been affected.
The basis of its analysis is the volume of drinks sales in Irish bars between 2000-2004, a period when there was a slow decline of about 3% per year.
A CIL consultant, Dr Tom Ellson, used this data to predict what would happen to the volume of sales if this long-term trend continued after the smoking ban was introduced in March 2004.
The red line on the graph below shows his predictions.
He also monitored how sales had actually changed since the ban was introduced, which is shown on the blue line.
Interestingly, the graph shows that the actual volume of on-trade sales has followed CIL's predictions very closely, continuing a steady decline, which Ellson argues would have happened irrespective of the smoking ban.
Based on this, his conclusion is that - despite the protestations of Irish publicans - the ban appears to have had little, if any, effect on drinks sales.
In fact, during the summer of 2005 actual sales rose significantly above the predicted level. Although the weather last summer was reasonable, it is possible that more people went out for a drink having decided that the ban had made pubs more pleasant places to visit.
However, drinks suppliers tell a different story. Diageo, for one, recently reported that the volume of Guinness sold in Ireland was down by 9% in the second half of 2005. But Geoff Rampton, managing director of CIL, believes this was more to do with the price of a pint of Guinness rather than the ban.
"We believe one of the contributing factors to the long-term decline in pub sales in Ireland is the price rises which have been seen there for some time," says Rampton. "In the second half of 2005 the price of Guinness rose substantially - and the value of Guinness sales only fell by 2%. Other beer companies, like Beamish, are doing well and wine sales are up very substantially. So perhaps the Irish are just losing the taste for Guinness - it isn't that they're not going out for a drink".
Almost two years after the ban on smoking in public places was introduced in Ireland, CIL suggests that the on-trade has not suffered nearly as much as licensees feared, and 2005 might have shown the first sign of a market that is beginning to level out after a period of gentle decline.
Methodology
CIL used Irish government statistics on the volume of alcoholic and non-alcoholic drinks sold in pubs for the five-year period ending December 2005. The effects of price changes during this period have been taken out of these figures.
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