Tesco wine festival sure to hit pubs

Tesco has slashed the price of hundreds of wines in half as part of its Autumn wine festival — a move which is sure to heap further pressure on pubs.

As the on-trade struggles against the credit crunch, declining visits, rising costs and another poor summer, Tesco is offering customers some bottles of wine for under £3 a bottle for a case of six.

The price of a case of six Vina Albali Rosado Tempranillo rose wine has been cut to £17.04 — just £2.84 a bottle. In total, 52 wines are on sale in cases of six for a price of below £5 a bottle.

In his budget, Chancellor Alistair Darling said that one of his reasons for upping duty was that the price of wine in supermarkets had fallen over the last ten years.

However, it seems the supermarkets have the buying power to ignore the duty rises and continue to use alcohol as a loss-leader at the expense of community pubs.

"This will certainly affect pubs," said Federation of Licensed Victuallers Associations chief executive Tony Payne.

"Is the Government happy that supermarkets are encouraging people to buy cheap alcohol and over indulge?

"The duty rises have not affected them at all. Pubs can not afford to compete on these prices.

"I would be in favour of a minimum price on alcohol."