The cost of binge drinking: in numbers

According to a new study, it is near the amount the Government spends on Jobseeker’s Allowance

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Harmful alcohol use has been identified as one of the leading preventable causes of death and a key risk factor for chronic diseases (such as cancer) and injuries worldwide. Specifically, alcohol use is responsible for 5.9% – about 3.3m – of deaths across the globe every year. While there is an existing body of research on the economic impacts of sustained heavy drinking, however, less is known about the economic cost of binge drinking and the size of its impact on road traffic accidents and arrests.

Binge drinking is characterised by periods of heavy drinking followed by abstinence. It generally results in short-term acute impairment and is believed to contribute to a substantial proportion of alcohol-related deaths and injuries. Overall, ONS statistics would suggest a falling trend in the number of people who binge drink but it is still a sizeable problem – with four in ten young adults consuming up to eight units on at least one day in the week before being interviewed by the ONS.

Counting the cost

In a paper we set out to count the costs of binge drinking. We used two data sets, the first on binge drinking status and the second on outcomes (A&E attendances, road accidents, arrests and number of police officers on duty) to calculate how these outcomes are affected during the times when binge drinking is most likely to take place. Rates of binge drinking were compared during the week and weekend between two different age groups: 18-30 and those aged over 50.

Those aged 18-30 are more likely to binge drink, particularly during the weekend. Outcomes for these two age groups were then compared during weekend nights. These results were combined to estimate the effect of binge drinking on the outcomes of interest.

We found that binge drinking increased the average number of daily injury-related A&E attendances by 8% and the daily average of road accidents by 17%. In addition, we found that the average daily number of arrests for all alcohol-related incidences increased by 45% and the number of police officers on duty increased by around 30%.

The cost of these effects is calculated using data available from a number of UK government departments. The Department of Health estimates the cost of attending A&E at £114 per person per visit. The average unit cost of an arrest is £14,836, according to figures from the Home Office. The cost arising from having additional police officers on duty is based on a £15 hourly wage per police constable. The Department for Transport estimates the cost of road accidents by taking account of ambulance and hospital (excluding A&E) treatment costs, damage to vehicles and property, administrative costs associated with accident insurance and the human cost of fatalities. Using 2014 prices, a fatal accident was estimated to cost just over £2m.

Our research indicates that a conservative total estimate of the economic cost of binge drinking at 2013-14 prices is £4.86 billion per year; equivalent to £77 per person living in the UK. To put this into context, this is around the amount the government spends on Jobseeker’s Allowance, a social security benefit.

Implications of a £4.8 billion bill

Understanding the economic cost of binge drinking can inform the public policy debate on alcohol use and contribute to more effective policy design.

Excessive alcohol consumption has been the direct target of health policy interventions worldwide. Common policies such as raising alcohol taxes, setting a minimum unit price for alcohol and restricting availability with minimum legal drinking ages, aim to discourage alcohol misuse and raise income to pay for its burden on society.

According to industry estimates, 52.8 billion units of alcohol were consumed in the UK in 2013. Given the total estimated cost of binge drinking is £4.86 billion, this equates to 9.8p per alcoholic unit consumed. To fully recover this cost would imply a 23% increase in the average retail price of alcohol (which was 42p in 2013-14) – equivalent to an additional 99p per bottle of wine and 23p per pint of beer.

There are several policies that could be implemented to recover this cost including, among others, minimum unit pricing, reform of the alcohol excise tax system and restricting the availability of alcohol through increasing the legal drinking age.

Minimum pricing

Minimum pricing policies establish a minimum price below which a unit of alcohol cannot legally be sold to consumers. In the UK, minimum unit prices under consideration range from 45p to 50p. We suggest that even the higher minimum price of 50p per unit falls short of the adjustment needed to offset the cost of binge drinking. Instead we need a minimum price of 52p per unit to offset the cost.

Of course, the debate over minimum pricing suggests that policy makers may struggle to implement such a policy. In Scotland, a legal challenge was launched over proposed minimum pricing. Another argument against minimum pricing policies include concerns that responsible drinkers and individuals on low incomes might be disproportionately affected.

An alternative policy is to reform the system of alcohol excise taxes so that rates increase directly in line with alcohol strength. Proposed excise taxes of 8.9p on 4% alcohol by volume (ABV) beer, 27.2p on 13% ABV wine are well below the 23% increase required to offset the cost of binge drinking. This research finds that excise taxes would have to be set at 23p per pint of beer and 99p per bottle of wine.

A third policy option is to restrict alcohol availability. Imposing a higher legal drinking age may reduce the impact of binge drinking by preventing a proportion of the 18-30 age group that commonly binge drink from obtaining alcohol. Based on evidence from the US, we estimate that increasing the legal drinking age in the UK from 18 to 21 would reduce the number of road accidents by 15%. This would amount to a reduction of 4.9% in the estimated cost of binge drinking-related road accidents, leading to a £100m saving.

Nevertheless, this saving represents only 2.1% of the total £4.89 billion estimated cost of binge drinking. Overall, following this policy is likely to offset only a small percentage of the cost.

By taking into account the estimated cost of binge drinking, policy makers can better tailor alcohol regulation policies to recover a greater proportion of this cost. It is also clear that more needs to be done to address the social factors that lead to binge drinking – unless approaches to understanding and tackling alcohol misuse are comprehensive, economic policies designed to mitigate the cost of binge drinking can have only limited success, and may well have a disproportionate punitive effect on responsible drinkers.

Jonathan James is a Lecturer (Assistant Professor), Department of Economics at University of Bath

Marco Francesconi is Head of Economics at University of Essex

This article was originally published on The Conversation. Read the original article.