Supermarkets urged to follow Tesco's lead

Trade leaders have urged other supermarkets to follow Tesco's lead and ask the Government to legislate against cut price promotions.

In an astonishing move the supermarket giant said it now supported action against irresponsible promotions but the Government would have to legislate to avoid accusations of price fixing and cartels.

"Supermarkets do sell a lot of alcohol and we accept that we have a role to play in addressing the problem of anti-social drinking,"​ said Tesco executive director Lucy Neville-Rolfe.

There is absolutely nothing to stop Tesco from unilaterally taking action to ban below cost selling in its outlets​Nick BishALMR

"Competition law prevents businesses discussing anything to do with price with each other and imposes severe penalties on anyone who breaches it.​

"The only safe solution is for the Government to initiate and lead those discussions and to bring forward legislative proposals which Tesco and others in our industry can support."

Code of promotions​

Paul Smith, executive director of late night trade body Noctis, said: "Tesco is to be commended for this. We hope that all the rest of the big supermarkets follow suit. ​

"We recognise that tackling pricing is a very thorny subject which requires some careful handling not to fall foul of strict competition legislation.

"Adoption of a policy on responsible promotions, following the lead of pub, club and bar operators, would be a very positive next step."

The Wine and Spirit Trade Association said it still believed that price and promotion were not the real issues behind alcohol abuse but welcomed the need for further discussions on price.

"Tesco is right to say that competition law prevents an industry wide discussion on the price and promotion of alcohol; we've been saying this to Government for some time,"​ said chief executive Jeremy Beadles.

Ducking responsibility​

However, Association of Licensed Multiple Retailers chief executive Nick Bish slammed Tesco for ducking its responsibilities in regard to cheap booze promotions.

"They are so addicted to below-cost selling that they appear unwilling or unable to moderate their own behaviour and instead need legislation to stop them,"​ he said.

"Every day, pubs and bars have to make the commercial and moral decision not to compete on price and to resist irresponsible promotions.​

"It beggars belief to suggest that the UK's biggest off-licence retailer is unable to do the same.

"There is absolutely nothing to stop Tesco from unilaterally taking action to ban below cost selling in its outlets."

Tesco's announcement came on the same day the British Medical Association called for the Government to take tougher action against cheap promotions.

It said a 10% tax hike could cut alcohol-related deaths by 30%.