Opinionista Mpiyakhe Dhlamini 22 July 2020

SA’s ban on alcohol will prove more damaging than alcohol itself

It is unfair to punish law-abiding, tax-paying citizens who drink responsibly for the bad behaviour of others. The ban on alcohol sales will have harsh economic and other consequences for the country.

A government’s actions must be seen to be reasonable and fair from the point of view of any law-abiding citizen. Any responsible administration has to consider various perspectives and balance the need to minimise the economic damage, minimise the extent to which our constitutional rights are limited, and help to save lives in the Covid-19 pandemic. 

The reintroduction of the alcohol ban tests those limits.

Before the pandemic, the alcohol industry in South Africa was a law-abiding, tax-paying industry. Inasmuch as the government has to take different perspectives into account, at the very least the people involved in the alcohol industry deserve to be consulted before any restrictions are put in place.

This is important for the industry at large, but more so when it comes to small business owners operating in the townships and rural areas. The two organisations that are most representative of this group, the Gauteng Liquor Forum and the Liquor Traders Association of South Africa, have already expressed their opposition to the latest ban. 

They argue that the R18-billion in lost alcohol sales – due to the original nine-week ban – put these smaller establishments under significant pressure early on in the pandemic. Furthermore, the loss in R3.4-billion in excise taxes should be a source of deep concern for the government. 

There does not seem to be any doubt as to whether the alcohol ban encourages the black market. Indeed, the industry has gone to the extent of asking the government to come up with an effective implementation plan for the ban, so that the legal industry does not suffer further harm.

In addition, the industry has conceded governments’ point about the increased hospital admissions due to alcohol consumption. Regardless, the fundamental point is that any blanket ban amounts to a punishment of the responsible and legitimate part of the industry and market. Indeed, the World Health Organisation itself proposes a range of evidence-based measures for reducing alcohol consumption without recommending a total ban.

Every reasonable drinker had been willing to make this sacrifice to aid in the larger goals of flattening the infection curve and getting the public health system ready for a Covid-19 surge. That the ban was extended by a further six weeks was a violation of the terms of an implicit, but no less important, social contract.

Representatives of the alcohol industry have signalled their willingness to accept some of the WHO measures, such as setting a new blood-alcohol limit of 0% for drivers, stricter regulation of times when alcohol may be sold, and so on. While none of these measures are likely to impact on black market sales, total supply would likely be reduced since the legal industry is preferred by consumers.

The black market for alcohol will not replace the legal market in the short to medium term, but there’s a real danger of losing market share and consequently a permanent reduction in tax revenues from the industry. There are a few factors driving this gain in market share, apart from the fact that the tax-paying industry is currently prevented from trading and therefore defending their market share.

The first factor is the economic harm done by the lockdown. The Treasury estimates that between three and five million jobs will be lost this year. This will reduce disposable incomes and lead to drinkers seeking cheaper and more dangerous alternatives. 

The second factor is that the manner in which both bans were instituted has led to a serious breakdown of trust between the government and drinkers; and the government and businesses involved in the alcohol value chain (the industry claims that the alcohol supply chain employs more than a million people).

 In extending the first ban beyond three weeks, the government dashed the hopes of drinkers who had been expecting that sales would resume after that initial period.

Every reasonable drinker had been willing to make this sacrifice to aid in the larger goals of flattening the infection curve and getting the public health system ready for a Covid-19 surge. That the ban was extended by a further six weeks was a violation of the terms of an implicit, but no less important, social contract.

Similarly, President Ramaphosa’s announcement on 12 July of a second ban on alcohol sales, this time with immediate effect, has again violated the same contract. 

The very people who have been diligently complying with Disaster Management Act regulations now find themselves being punished for being ‘irresponsible’. Without a doubt, a significant proportion of drinkers continue to use alcohol irresponsibly, but surely it is unfair to put the burden of their behaviour on law-abiding, tax-paying citizens who drink responsibly. 

To make matters worse, in the same speech announcing the ban, Ramaphosa also said South Africa is now entering an expected peak in the number of Covid-19 infections. This means the government knew the peak was coming when they relaxed the first alcohol ban. They knew, then, about the impact alcohol has on hospital admissions.

The president also said the case fatality rate at 1.5%, was lower than expected. This means that in the face of the surge – which is turning out to be less severe than they predicted – the government still decided to ban the sale of alcohol, even after lifting the previous ban. These seemingly irrational actions can only undermine respect for the law, leaving the government facing a serious crisis of credibility. DM

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