March 09, 2007

HUNTING ACCIDENTS INVESTIGATE: JUL 03

They act before they think, almost pre-programmed to shoot on reflex -HAMISH CARNACHAN investigates the campaign to stop hunters killing each other in the bush

On Easter Sunday a young Hamilton man, out deer- stalking in the Kaimanawa Ranges, shouldered his rifle, placed the crosshairs over what he thought was the hindquarters of a deer, and squeezed the trigger. It took barely a split second for the high-powered projectile to travel the 20 metres to its target. But, in a blink of an eye that one bullet took one life, shattered the lives of many, hammering home in the harshest possible way the tenuous grasp of an individual’s existence.

Christopher Martin Davies had made the most fundamental error a hunter can make, a basic error of judgement that was to have catastrophic and lasting consequences far beyond the simplicity of that lethal act – he failed to correctly identify his target.

The tawny-coloured object Davies thought was a sika deer meandering through the scrub turned out to be a fellow deerstalker. By the time he had made that critical assessment though, it was too late for Taupo father Mark Leathwick. The hunter had become the hunted. Davies’ fateful shot slammed into Leathwick’s head killing him instantly, and making media headlines almost as quickly.

This tragic episode was to be the latest in a string of hunting related accidents over the month of April, and the third fatal shooting in as many weeks in the central North Island. Nine days prior to the death of Leathwick, Hamish Harland was shot dead by family friend and hunting partner David Webster Alker in Tongariro National Park, which followed the death of Mangawhai resident Peter McIntyre who was shot in the Urewera National Park at the start of the month. Over the same period, two South Island men were also hospitalised after being accidentally shot in separate hunting incidents – more would fall in the following days. And, only late last month, a 19-year-old man was killed by a member of his own party while hunting wallabies in South Canterbury.

These victims are among the more than 30 000 Kiwi hunters who will enter the bush this year to participate in what is normally one of the safest forms of outdoor recreation. But instead or returning with a trophy or yarn about the one that got away, they unwittingly join a list of casualties that many say could have been avoided.

Now, after one of the worst starts to the season on record, the public, police and shooting organisations are all hunting for answers: Why are good keen men continuing to kill each other in pursuit of leisure? How do you mistake a man for a deer? And, with three more families grieving the loss of loved ones, what can be done to prevent further tragedy and heartbreak?

On average, since 1979 there has been one accidental shooting of a hunter by another hunter every nine months. Over the past two years, Inspector Joe Green has studied every one of these cases. While his report is currently being peer reviewed and is not scheduled for public release until mid-July, he was willing to share some of his findings with Investigate.

Though he likes to emphasize that the number of hunting fatalities remains relatively low compared with other recreational pursuits, Green’s research still highlights some worrying aspects - in almost every case there has been a failure to correctly identify the target shot.

What makes this concerning to many, and "downright puzzling" to Green, is the fact that these hunters appear to have forgotten the very basics of firearms ownership and indeed arms-control law. One of the golden rules in the ‘Firearms code’ – the manual which all prospective gun owners must study to pass the licensing test – is ‘clearly identify your target’.

Every year there are reported cases of accidental gun discharges causing injury, and occasionally death, but Green says by far the most common cause of death in the incidents he studied has been one person shooting another person. There are a number of factors behind why this occurs but in most cases he points out that it is because "shooters seem to shoot at shape, sound or colour", breaking the simple rule which has resulted in at least two of the fatalities this year.

No one can doubt that when a hunter shoots another hunter it is a ter-rible mistake, but the question persists: Why do they forget such a basic rule? It’s the equivalent of a driver completely forgetting that they have to stop for a red light (which is quite different to purposely running the signal).

An important factor, according to Green, is a little-known phenomenon he refers to as "buck fever", which he describes as "a psychological state whereby the hunter’s desire to shoot their quarry is so strong that it overrides all rational thinking".

Speak to any hunter and they will invariably detail the concentration, often required for hours on end or even days, which goes into stalking a deer. Nerves are taut, the atmosphere intense, it’s all part of the primal thrill of the hunt. Green says when a hunter is "wound up" during the chase any unnatural distraction can draw a snapshot, in some cases with tragic consequences.

Bob Badland, who heads the Firearms Safety division of the New Zealand Mountain Safety Council, also accepts that buck fever has played a large part in the fatal shootings but suggests that identifying the issue is a lot easier than combating it.

"I’ve been to coroners’ hearings and the shooter always describes it very slowly when they recall the incident but when it actually happens, it is in an instant," says Badland. "It’s almost a tunnel vision, but we don’t know how to prevent it kicking in."

And the president of the New Zealand Deerstalkers Association, Trevor Dyke, is in collusion too.

"How are you supposed to stop an irrational action affecting a sane person?" he asks. "The eye sees something and in a flash the brain fills in the missing pieces. We’re always bringing home the message about the importance of identifying your target so what more can you do?"

But it’s somewhat surprising then that there is not even a semblance of discussion about such a vital issue anywhere on the association’s website. Dyke argues that’s because "they’ve had technical problems" but hastens to note that he has written a column on the topic for the upcoming issue of Hunting and Wildlife – a quarterly magazine produced for association members.

However, he says there has been a noticeable lack of warning in other media prior to "the roar" – the deer-mating season.

"Usually press packs put together by the police and other organisation are sent out to all the [outdoor orientated] magazines. It didn’t happen this year."

Badland disagrees. The Mountain Safety Council’s Firearm Safety section, funded by the police, is tasked with that job and he says every year the message is "churned out regardless".

"We spend a good portion of our budget targeting hunters – we have the safety message on every item we produce."

In fact, the Mountain Safety Council has some 15 firearms safety publications, and another one due for release soon. It even has plans for "something a little different" – a wallet-sized hologram card with an image of a hunter superimposed over that of a deer. It’s imagery with a clear message, ‘Shoot; don’t shoot’, but whether or not it will make any more difference than the other safety resources seems dubious. Though it’s not to say he is giving up, even Badland has his doubts.

"We just have to keep trying to get the point across."

The Mountain Safety Council also runs various hunter education courses in an effort to hammer the point home. One such module is the Hunter National Training Scheme (HUNTS), a programme operated by the Deerstalkers Association. For a fee of around $140, new hunters are tutored in the basic knowledge and skills required for shooting in the New Zealand outdoors.

Of the hunters involved in accidentally shooting another person, Green discovered that all but one of them had not completed any hunting-specific training. So would making such courses a requirement of the gun-licensing regime have any effect on the number of accidental shootings?

He says it’s something he has pondered in the past, but still has serious reservations about making it compulsory. There are around 240 000 firearms licence holders in New Zealand and because only a small proportion of them are deerstalkers, Green believes the training would be wasted on most.

"The best way to encourage people to do it is to make it more accessible by lowering the cost."

Then maybe compulsory gun club membership and requirements to regularly attend refresher courses in firearms safety is an option? Perhaps not. The mere mention of increased legislation has gun owners up in arms – figuratively speaking.

"We’re already heavily regulated," cries Dyke. "I can’t see how much more tightening-up you can do. At any rate, if they were forced to join a club you’d probably find $5 overnight deals springing up all over the place, actually achieving nothing other than a means of getting around a law."

Even Badland agrees that stringent regulation wouldn’t be the magic bullet.

"Hunters hate it when this happens because it brings the spotlight down on arms control issues but regulation is not the answer. Look at the number of murder victims that have been shot – legislation hasn’t stopped that."

Presently, anyone who wants to take a firearm onto the conservation estate can pick up a permit from the Department of Conservation (DOC). Unlike privately owned hunting blocks, where hunter density is strictly kept low, there is no limit to the number of permits issued by DOC. In fact, under the Pest Management Strategy, DOC has set a clear mandate to destroy unwanted organisms, like deer, and actively encourage hunters to help carry out that task. Consequently though, questions are starting to be raised about whether the number of deerstalkers in some areas is getting dangerously high.

Dyke recalls one expedition into the bush near Taupo where there were more than 30 hunters in a block of only a few hectares.

"Your chances of bumping into another hunter in conditions like that are pretty high, we did and the other guy had no idea we were there."

Over the period of March to June this year approximately 1000 hunters entered the Taupo/Tongariro estate, which comprises an area of 220 000 hectares. Clearly that’s plenty of space for each deerstalker - if they were separated into individual blocks. They’re not though and that is the perceived problem with the current permitting regime.

Is hunter density the issue? Again, it seems it isn’t specifically the case, and again this highlights the fact that there may not be any simple solution. In some of the most heavily hunted areas of Marlborough, where no permit is required, there has never been a fatal shooting. Likewise, Stewart Island doesn’t have a problem despite the fact that, with its world-renowned whitetail deer herd, some hunters say more guns pass through the area than anywhere else on Earth.

But, as Dyke suggests, "Hunters being hunters, they like to shoot in twos and threes and fours." And Green’s studies highlight that nearly 65 percent of the time the deceased and the shooter are from the same party.

"In most cases they decided to split up into agreed areas but one of them has ended up straying into their companion’s zone," says Green.

Still, whether it’s a mate or a stranger, they’ve failed to abide by that same golden rule. That’s why Badland is critical of DOC and raises the issue of "landowner responsibility". He says aside from a sentence in fine print on the back of the hunting permits, the department does little to promote the safety message.

"What the hell are the Department of Conservation doing? They don’t put a lot of publicity out there but it’s people being shot on their land. They expect us to do their job for them."

It’s not like Badland’s section can afford to go it alone on promoting the safety issue either. While the New Zealand Mountain Safety Council "is funded by ever decreasing lottery grants", the firearms division is funded solely by the New Zealand Police. Badland is expected to fire the safety message, among other tasks, at nearly a quarter of a million gun license holders with only $140,000 a year.

"We do the best we can", says Badland, but he is concerned at rumours that DOC plans to scrap the permitting system altogether. If that happens, hunting on conservation estate becomes a self-regulatory practice and that, he says, raises further serious concerns about safety.

Though there are numerous and varied recreational user groups that enjoy leisure activities in the wilderness, it is still hunter safety that is the greatest concern. The statistics show that hunters shoot hunters. Experts suspect this is because they move carefully through the bush like their prey and even sound the same - hunters will often mimic the roar of a stag to entice it closer. Davies was reportedly following the sound of a sika stag just before he saw movement and snapped a shot off at Leathwick. The general consensus among deerstalkers is that it was the victim who was calling.

Laws similar to those in the United States, requiring hunters to wear portions of highly visible clothing, have been floated here as a possible means of preventing hunters being shot in this way. But both Leathwick and Harland were wearing brightly coloured clothing, specifically to avoid being mistaken as deer. In a bitter irony, Davies bullet even went straight through Leathwick’s "blaze orange" cap. Harland had the same ‘protective’ colouring across the top half of his bush jacket.

In the US almost all hunters (only excluding those targeting turkey) have been required by state law to wear "blaze orange" during firearm deer seasons since 1987. But while the number of overall hunting fatalities has decreased, Green says the latest research from Virginia shows that the legislative requirements have had no impact on the number of deer hunters accidentally shot. And that’s diplomatic compared to what some critics believe - they suggest the rate has actually risen.

"I think high visibility orange might be a protective factor in some instances, but in others cases it might even be a contributing factor," says Green. By that he means a highly visible flash of colour could actually attract a hunters attention and draw a hasty shot.

As part of his research into hunting related fatalities, Green has also carried out experiments with different shades of brightly coloured clothing in the bush. He concludes that in various levels of light, and different environments, bright orange might not always be the most suitable colour – from a distance it can appear to be a reddish hue. That just happens to be the same colour as the hide of a red deer – the most numerous and widely dispersed species in New Zealand. Scary given that almost all hunter protective clothing uses "blaze orange". Now there are a whole host of hunters tearing around in the forest thinking they’re safe, yet they could inadvertently be wearing a ‘bulls-eye’.

"We’re still encouraging hunters to wear bright colours, but we’re telling them to make sure that what they wear contrasts with the environment they’re hunting in."

Green believes that a shade of light blue, like that worn by United Nations troops, is likely to provide the most obvious distinction in the forest. This is precisely why Badland hopes a Coroner "won’t rush in" and force New Zealand to follow America’s lead, at least until more studies have been carried out.

Research into ‘protective’ colours and alternative identification techniques are ongoing – with some unusual collaboration too. Badland says the police and the Mountain Safety Council are investigating work currently being carried out by the Land Transport Safety Authority and the military.

Overseas, armed forces are endeavouring to develop effective personal identification devices to prevent loss of life through ‘friendly fire’, much like a warning alert sounded if a shooter targets their own troops. Meanwhile, road transport agencies are working on ‘glow in the day’ signs. Both initiatives could potentially be applied to hunters says Badland.

"How many road signs do you reckon you passed on your way to work this morning that you didn’t notice or understand the message?" he asks. "We have to keep pushing the safety message to hunters, like the police keep pushing their road safety campaign. But, like drivers on the road, it’s still up to the person in control to make that vital decision. If we can make the signs any less confusing then it’s got to make them safer."

Despite the publicity given to hunting accidents, hunting is still among the safest outdoor recreation sports. It’s a fact that everyone who spoke to Investigate has hurriedly pointed out in one way or another. There’s no doubt that the motoring industry, with all its advances in safety, would love to have hunting’s accident rate. Dyke says the number of shootings this season have just been "a glitch" and others, well they say that basically you’re more likely to be struck by lightning than be shot.

But, as Badland says, "At the end of the day it will happen again and we’ll ask ourselves the same question – what more can be done?" And that means, again, some unfortunate family is still going to have to make sense of a senseless tragedy - that their loved one has become another "statistic" to a split-second error.

As for the shooters in the latest tragedies, Davies and Alker have both been jailed for nine months. The men were sentenced in the Taupo District Court on 20 May after each admitted carelessly using a firearm causing death. Judge Chris McGuire also ordered Davies and Alker to pay $5000 each in reparation to the victims’ families. Davies is likely to appeal his sentence, but Alker has ruled out that option - he has publicly stated that after shooting his best mate he now carries a life sentence.

Posted by Ian Wishart at 01:08 AM | Comments (0)

GRIPE JUICE: LIQUOR TAX FALLOUT INVESTIGATE: JUL 03

Imagine trying to cut the road toll by making it illegal to ride a bicycle. Then imagine trying to reduce teen alcohol consumption by putting a hefty new tax on port and sherry. Little wonder, as HAMISH CARNACHAN discovers, that the wine industry is becoming a whine industry as opposition to the tax grows

Bloodied, battered and intoxicated teenagers line the waiting room, which by 2am looks more like an army field hospital than an accident and emergency centre. Some temporarily tend to their own injuries with gauze dressings thrust at them by overworked nurses, others, passed out on a friend’s shoulder, will stay comfortably comatose until a frantic doctor finally gets a chance to wake them and examine their wounds.

It’s not too hard to find the fallout of youth binge drinking - venture out to any emergency ward late Friday or Saturday night and you’ll discover the bloody aftermath. Some will be less fortunate of course – they’ll end up in hospital proper with injuries more serious than superficial scrapes and cuts – but most will make it safely home and have nothing to nurse but a nasty hangover.

Still, the social and economic cost of such excesses is something to cause concern - a host of studies and statistics say so. But is hiking up the price of liquor the best way of tackling the matter and was the secrecy surrounding the Government’s latest move, the implementation of the so-called "teen-tax", warranted?

Well, the Government felt that way when, much like medical staff working late into the night, the legislative practitioners hurried an emergency operation through Parliament in an effort to stem the social haemorrhaging – or so they say.

In his capacity as acting Minister of Customs, Jim Anderton spearheaded the procedure to pass the Customs and Excise (Alcoholic Beverages) Amendment Bill. This has effectively increased the excise duty that the government charges on beverages containing more than 14 percent, but no more than 23 percent, of alcohol-by-volume.

Prior to Parliament ramming through the new law, unannounced, some ‘light spirits’ in the 14 to 23 percent alcohol-by-volume range were not charged for their actual content of alcohol. The Government argues that many manufacturers were using the loophole to sell products at the higher percentage end of the bracket whilst still benefiting from an arbitrarily low tax rate.

The new tax increase, says Anderton, is "to promote safer communities by discouraging underage teenagers and children from misusing alcohol".

Essentially, the ‘light spirits’ Anderton is hoping to target with his new law are the diluted versions of high-alcohol liquor like whiskey, gin and vodka – beverages the minister says are the biggest cause of grief for youths.

"The products that mainly fall into this category are the very cheap light spirits often used by young people," he says. "This is an important piece of legislation to address a serious challenge being faced by far too many New Zealand families.

"The drinking habits of too many young New Zealanders are of great concern. Recent surveys have shown an increase in the level of heavy drinking amongst the young. This trend is both dangerous and unacceptable to our society."

Last year the Alcohol Advisory Council (ALAC) commissioned Brian Easton to report on the impact of excise tax on alcohol. A central finding was that alcohol is one of a handful of products where the costs of production do not accurately reflect the overall costs to society of consumption.

"The excess social costs are substantial," states Easton. "The most comprehensive estimate suggests that alcohol misuse reduces effective GDP by 4 percent, may well reduce the effective size of the unmeasured (informal) economy by a similar amount, and has also reduced the welfare of New Zealanders via additional mortality and morbidity by 2 percent and the population of New Zealand by 0.8 percent.

"The excess social costs may be thought of as the economists’ equivalent of harm, in which case the objective of alcohol policy in economic terms is to reduce social costs. Reducing the gap between the prices on which individuals base their alcohol consumption decisions and the social cost to the economy will reduce harm, because individuals are less likely to partake of potentially harmful consumption."

Higher prices for alcohol are considered to impact on different consumers in different ways. While evidence suggests such moves have negligible influence on moderate, heavy and chronic drinkers, teenagers tend to reduce their drinking in the face of higher prices.

"It seems likely that there is less drinking in extended drinking sessions as the price rises," reports Easton.

Fair enough, one might conclude. So what’s got so many in the hospitality and liquor industries gagging then?

Quite simply, they are furious with the "haste and secrecy" surrounding the law change, and are questioning the Government’s social conscience in light of what they say is a fundamentally flawed notion. They are also critical that the move is as watered-down as the products the legislation is supposed to target - nothing more than another tax grab dressed up for public consumption.

While the Alcohol Advisory Committee-commissioned report places a clear emphasis on the social costs of alcohol, it is acknowledged that any measure of the toll the youth bracket imparts on the economy would be far from objective – it’s simply too tough to accurately calculate. If anything, health advocates argue that alcohol consumption should be reduced across the board, not forced upon any one group. The hospitality industry agrees.

"In many ways that’s what light spirits achieve by providing a lower alcohol spirit option," says Hospitality Association Chief Executive Bruce Robertson. "Light spirits provide an option for spirit drinkers to reduce their alcohol intake in the same way that low alcohol beers do for beer drinkers."

Calculating excise can be quite a complex business. Prior to Anderton’s changes, there were seven steps on the scale, depending on the beverage’s alcohol content. In the report, a graph of alcohol content against tax per litre shows a clear drop at the 23 percent mark – a point where the Government decided kids were getting "the best bang for their buck".

"The Bill puts into effect the recommendation in the Easton report relating to the excise duty on light spirits," explains Anderton in a statement released after the new law had been passed. "The change means that alcoholic beverages in the 14 to 23 percent alcohol range can be taxed according to their actual alcohol content, rather than all being levied as though they contain 18 percent alcohol by volume. The changes also mean that the products will be taxed at the higher rate – the same rate that full-strength spirits are taxed at. This will remove the tax advantage that the light spirits currently receive."

However, among other recommendations, Easton’s report suggests a decrease in the tax on higher alcohol spirits and yet the Government has chosen not to implement that. It’s this "selective" reckoning that has inspired talk of a tax grab.

Robertson acknowledges that the tax regime for alcohol is far from perfect and lacking in logic, but he says the Government has reached "new levels of absurdity" with this latest move.

In an article for Food and Beverage magazine Robertson highlights two key influences which, when combined, formed the trigger for the tax hike.

"The first was the formation, following the last election, of a Ministerial Taskforce on drugs and alcohol lead by Progressive Coalition Leader Jim Anderton…This taskforce has therefore been looking as to how they can and can be seen to be making progress to reduce problems associated with young people and alcohol and drugs.

"The other player has been the distilled spirits industry dominated by the overseas brand owners who have been perturbed to see the erosion of their market from ‘ready to drinks’ [RTDs] and the emergence of a light spirits category…one of their strategic objectives has been to remove or significantly dent the light spirits category. So it seems that submissions from this sector to ALAC have argued that as an effective harm minimisation measure light spirits should be taxed at a higher rate.

"The only real winners from these tax changes are the Government with greater revenue and the international full strength brand owners anticipating greater sales. The losers are all those involved in producing products between 14 and 23 percent, and in particular the consumers who enjoyed these products."

Figures suggest that revenue from excise duty on alcohol does not even cover the costs incurred by the public health sector in dealing with alcohol associated injuries and harm. Does that mean Robertson and others have a point when they suggest the new regime is merely a scheme to line government coffers? Probably not – on current consumption levels the new duty will only net treasury about $18 million. And if Anderton’s prediction is correct, an associated decrease in the drinking of light spirits will result in even less revenue being generated. He repeats that the aim is to reduce young drinkers’ demand for these alcoholic beverages.

"This will mean that young people will not be able to afford as much alcohol as they currently do. Their $10 pocket money won’t be able to buy them a bottle of gin. They’ll drink less alcohol, get less drunk, and cause less harm."

But caught in the crossfire are the producers and consumers of wine-based products – such as sherry and port. While distilled spirits, particularly light spirits, can be produced at low cost, the same cannot be said of fortified wines. Unfortunately for the latter, they fall within the magic 14 to 23 percent alcohol range and are now subject to the same excise duty.

Many small winemakers have made considerable investments in sherry and port production and because these types of wine typically need time to mature, wineries have substantial stocks on hand.

New Zealand Winegrowers, the industry body for the country’s winemakers and grape growers, says the change in the excise regime will have a striking impact in the market, making it extremely difficult, if not impossible, for winemakers to sell the stock they have on hand.

"The financial impact of this could be disastrous, especially for smaller companies," says Chairman Peter Hubscher.

Henderson-based Pleasant Valley Wines, the oldest family-owned winery in New Zealand, has been making port and sherry for over 100 years. Owner Stephan Yelas says that while the company has just celebrated a milestone in terms of its centenary, it is the end of an era because they are pulling the plug on fortified wine production.

"We’ll just run stocks out now because we can’t see any money left in it. There’s no margin for profit any longer," he says.

New Zealand makes 1.2 million litres of port and sherry each year. While that only amounts to about 2 percent of the country’s total wine production, a string of family businesses in the Henderson area, many of which have been established for a long period of time, base their income on fortified wines.

Pleasant Valley will survive through the sale of its mainstay table wines, but Yelas agrees with Hubscher that other companies in the region, particularly the boutique wineries that focus primarily on port and sherry production, are likely to find the new excise duty very tough for business.

Yelas says he found out about the new excise duty like everyone else - "on the news." So was he annoyed when he heard? He says not as angry as the customers, who it turns out are "100 percent the older pensioners".

Indeed, the biggest market for sherry and port in New Zealand is the older generation. And that is why many critics say the new legislation simply defies logic, given that it is supposed to target youth drinking. One cynical commentator wrote that it is rather like attacking the high teenage pregnancy rate by taxing Viagra, or restricting boy racers by increasing the duty on diesel.

Hubscher says the elderly are bound to find the price increase of approximately $5 to $6 per bottle very hard to swallow, especially since most of them are on fixed incomes.

"This inflicts unnecessary hardship on people who have been contributing to our country for many decades and who are not part of the problem the new law purports to address," he says.

One suggestion in the Easton report states: "In order to maintain realistic minimum levels for the price of alcohol, either the base excise duty rate for all alcohol has to be raised, or a differential between spirits needs to be introduced. This reports recommends the latter option."

Winegrowers CEO Philip Gregan says essentially this proposes that light spirits should be taxed higher than other alcoholic beverages that fall within the 14 to 23 percent alcohol range. He says this would have made more sense than the adopted approach.

"There’s a fundamental difference between fermented beverages and distilled beverages," says Gregan. "That’s been recognised in past excise regimes. To be consistent, that logic needed to be carried through here. They haven’t though and by incorporating fortified wines they’ve blurred the line between distilled and fermented beverages."

Anderton’s rationale is that "this is necessary to ensure that these products [fortified wines] do not become an alternative source of low-priced, higher alcohol content beverages…"

Gregan thinks that is absurd. "Kids don’t drink fortified wines. The whole marketing profile and flavour profile is wrong."

And this isn’t the only reason Winegrowers is disgruntled. While the Government claims to have pushed the Bill through Parliament under such urgency so as to prevent one company gaining an unfair advantage over its competitor, Hubscher says the complete lack of discussion was a clear breach of a promise made by Anderton three months earlier.

"To make matters worse, this ill-conceived policy was rushed through without consultation – consultation the industry was promised in writing on more than one occasion by Jim Anderton in February of this year. It is a serious injustice that this promise was not kept," says Hubscher.

Investigate asked Winegrowers for a copy of Anderton’s letters but the request was declined on the basis that "it’s not in the public domain". However, we did find the following excerpt on Winegrowers’ website in which Anderton advises: "If we are to find the solutions to the problems we are exploring then it is crucial that these should be ones upon which as many as possible of the stakeholders can reach agreement. If we don’t take this approach then I doubt that we will succeed in our endeavours."

It is important to note that while the Government has adopted approaches outlined in his report, calling Easton the villain, as some commentators have alluded to, may not be the most objective reaction. Featured in the paper are recommendations and examples to "assist public discussion". In fact, he highlights it as an imperative.

"That it is a political judgement suggests the need for a wide public debate on the appropriate excise duty rate," writes Easton.

But since Anderton’s February correspondence, Winegrowers says it has had no consultation with the Government about the matter.

"We are fully supportive of the Government’s commitment to resolve the issue of excessive drinking by young people," says Hubscher. "We also agree with Mr Anderton’s letter that consultation with stakeholders is central to successful policy outcomes. Like him, we believe that the new regime will fail in its objectives because he has not taken key stakeholders with him on this issue.

"The policy will put some small winemakers out of business. It will make no contribution to solving the youth drinking problem."

By using less juice or less soft drink in the mix, young drinkers will get much the same effect as before, says Hubscher, and he predicts that the producers of light spirits will simply change their products to have 13.9 percent alcohol to bypass the new rules.

Independent Liquor, New Zealand’s largest light spirits producer, has done exactly that. It has reformulated its range of drinks to have an alcohol content of 13.9 percent in a move reported to have been "unashamedly aimed at beating" the teen-tax.

And if concern about the social impact of youth drinking is the real issue, why has the Government not attacked teenagers’ "drink of preference" – the sickly-sweet, brightly coloured, lolly-water beverages referred to as alco-pops or RTDs?

"Light spirits are of greater concern at the moment than alco-pops as the price of light spirits currently allows young people to purchase a greater quantity of alcohol for a less amount of money," is Anderton’s reply.

There’s a clear consensus, spoken on talkback radio and voiced in the odd editorial – the new tax will prompt a short-term reduction in youth binge drinking but it is not a long-term solution.

"Government should be addressing the question ‘why do young people or indeed any New Zealanders binge drink?’" says Robertson. "Instead they have a simplistic view that the price they pay for alcohol is their major driver to binge and it will be fixed by increasing the price, and that’s simply not the case."

Groups opposing liquor advertising aimed at young people report that it is the commercials that have lead to more teen binge drinking. Given that the Herald recently revealed that liquor companies received "mate’s rates" from government-owned Television New Zealand, to encourage intense advertising, it is hardly surprising that people are struggling to understand the logic behind the latest move.

Robertson is one of many who argue that the Government would be concentrating on more fundamental questions if social interest was the priority. Others see it as a little contradictory that a ‘conscience vote’ in Parliament led to the lowering of the drinking age in the first place, and some say the lack of consultation was a flouting of the democratic process.

However, it is hard to argue with the underlying principle, or indeed the statistics, that teenage binge drinking is a serious concern, not just for the healthy development of that cohort, but also for society as whole. And yet, it is an issue that most agree necessitates action that actually hits the mark - a more measured response than the impromptu measures carried through a sleepy Parliament that night. Instead, says Robertson, "Government has used a sledge hammer and missed the target."

Posted by Ian Wishart at 01:04 AM | Comments (0)

GRIPE JUICE: LIQUOR TAX FALLOUT INVESTIGATE: JUL 03

Imagine trying to cut the road toll by making it illegal to ride a bicycle. Then imagine trying to reduce teen alcohol consumption by putting a hefty new tax on port and sherry. Little wonder, as HAMISH CARNACHAN discovers, that the wine industry is becoming a whine industry as opposition to the tax grows

Bloodied, battered and intoxicated teenagers line the waiting room, which by 2am looks more like an army field hospital than an accident and emergency centre. Some temporarily tend to their own injuries with gauze dressings thrust at them by overworked nurses, others, passed out on a friend’s shoulder, will stay comfortably comatose until a frantic doctor finally gets a chance to wake them and examine their wounds.

It’s not too hard to find the fallout of youth binge drinking - venture out to any emergency ward late Friday or Saturday night and you’ll discover the bloody aftermath. Some will be less fortunate of course – they’ll end up in hospital proper with injuries more serious than superficial scrapes and cuts – but most will make it safely home and have nothing to nurse but a nasty hangover.

Still, the social and economic cost of such excesses is something to cause concern - a host of studies and statistics say so. But is hiking up the price of liquor the best way of tackling the matter and was the secrecy surrounding the Government’s latest move, the implementation of the so-called "teen-tax", warranted?

Well, the Government felt that way when, much like medical staff working late into the night, the legislative practitioners hurried an emergency operation through Parliament in an effort to stem the social haemorrhaging – or so they say.

In his capacity as acting Minister of Customs, Jim Anderton spearheaded the procedure to pass the Customs and Excise (Alcoholic Beverages) Amendment Bill. This has effectively increased the excise duty that the government charges on beverages containing more than 14 percent, but no more than 23 percent, of alcohol-by-volume.

Prior to Parliament ramming through the new law, unannounced, some ‘light spirits’ in the 14 to 23 percent alcohol-by-volume range were not charged for their actual content of alcohol. The Government argues that many manufacturers were using the loophole to sell products at the higher percentage end of the bracket whilst still benefiting from an arbitrarily low tax rate.

The new tax increase, says Anderton, is "to promote safer communities by discouraging underage teenagers and children from misusing alcohol".

Essentially, the ‘light spirits’ Anderton is hoping to target with his new law are the diluted versions of high-alcohol liquor like whiskey, gin and vodka – beverages the minister says are the biggest cause of grief for youths.

"The products that mainly fall into this category are the very cheap light spirits often used by young people," he says. "This is an important piece of legislation to address a serious challenge being faced by far too many New Zealand families.

"The drinking habits of too many young New Zealanders are of great concern. Recent surveys have shown an increase in the level of heavy drinking amongst the young. This trend is both dangerous and unacceptable to our society."

Last year the Alcohol Advisory Council (ALAC) commissioned Brian Easton to report on the impact of excise tax on alcohol. A central finding was that alcohol is one of a handful of products where the costs of production do not accurately reflect the overall costs to society of consumption.

"The excess social costs are substantial," states Easton. "The most comprehensive estimate suggests that alcohol misuse reduces effective GDP by 4 percent, may well reduce the effective size of the unmeasured (informal) economy by a similar amount, and has also reduced the welfare of New Zealanders via additional mortality and morbidity by 2 percent and the population of New Zealand by 0.8 percent.

"The excess social costs may be thought of as the economists’ equivalent of harm, in which case the objective of alcohol policy in economic terms is to reduce social costs. Reducing the gap between the prices on which individuals base their alcohol consumption decisions and the social cost to the economy will reduce harm, because individuals are less likely to partake of potentially harmful consumption."

Higher prices for alcohol are considered to impact on different consumers in different ways. While evidence suggests such moves have negligible influence on moderate, heavy and chronic drinkers, teenagers tend to reduce their drinking in the face of higher prices.

"It seems likely that there is less drinking in extended drinking sessions as the price rises," reports Easton.

Fair enough, one might conclude. So what’s got so many in the hospitality and liquor industries gagging then?

Quite simply, they are furious with the "haste and secrecy" surrounding the law change, and are questioning the Government’s social conscience in light of what they say is a fundamentally flawed notion. They are also critical that the move is as watered-down as the products the legislation is supposed to target - nothing more than another tax grab dressed up for public consumption.

While the Alcohol Advisory Committee-commissioned report places a clear emphasis on the social costs of alcohol, it is acknowledged that any measure of the toll the youth bracket imparts on the economy would be far from objective – it’s simply too tough to accurately calculate. If anything, health advocates argue that alcohol consumption should be reduced across the board, not forced upon any one group. The hospitality industry agrees.

"In many ways that’s what light spirits achieve by providing a lower alcohol spirit option," says Hospitality Association Chief Executive Bruce Robertson. "Light spirits provide an option for spirit drinkers to reduce their alcohol intake in the same way that low alcohol beers do for beer drinkers."

Calculating excise can be quite a complex business. Prior to Anderton’s changes, there were seven steps on the scale, depending on the beverage’s alcohol content. In the report, a graph of alcohol content against tax per litre shows a clear drop at the 23 percent mark – a point where the Government decided kids were getting "the best bang for their buck".

"The Bill puts into effect the recommendation in the Easton report relating to the excise duty on light spirits," explains Anderton in a statement released after the new law had been passed. "The change means that alcoholic beverages in the 14 to 23 percent alcohol range can be taxed according to their actual alcohol content, rather than all being levied as though they contain 18 percent alcohol by volume. The changes also mean that the products will be taxed at the higher rate – the same rate that full-strength spirits are taxed at. This will remove the tax advantage that the light spirits currently receive."

However, among other recommendations, Easton’s report suggests a decrease in the tax on higher alcohol spirits and yet the Government has chosen not to implement that. It’s this "selective" reckoning that has inspired talk of a tax grab.

Robertson acknowledges that the tax regime for alcohol is far from perfect and lacking in logic, but he says the Government has reached "new levels of absurdity" with this latest move.

In an article for Food and Beverage magazine Robertson highlights two key influences which, when combined, formed the trigger for the tax hike.

"The first was the formation, following the last election, of a Ministerial Taskforce on drugs and alcohol lead by Progressive Coalition Leader Jim Anderton…This taskforce has therefore been looking as to how they can and can be seen to be making progress to reduce problems associated with young people and alcohol and drugs.

"The other player has been the distilled spirits industry dominated by the overseas brand owners who have been perturbed to see the erosion of their market from ‘ready to drinks’ [RTDs] and the emergence of a light spirits category…one of their strategic objectives has been to remove or significantly dent the light spirits category. So it seems that submissions from this sector to ALAC have argued that as an effective harm minimisation measure light spirits should be taxed at a higher rate.

"The only real winners from these tax changes are the Government with greater revenue and the international full strength brand owners anticipating greater sales. The losers are all those involved in producing products between 14 and 23 percent, and in particular the consumers who enjoyed these products."

Figures suggest that revenue from excise duty on alcohol does not even cover the costs incurred by the public health sector in dealing with alcohol associated injuries and harm. Does that mean Robertson and others have a point when they suggest the new regime is merely a scheme to line government coffers? Probably not – on current consumption levels the new duty will only net treasury about $18 million. And if Anderton’s prediction is correct, an associated decrease in the drinking of light spirits will result in even less revenue being generated. He repeats that the aim is to reduce young drinkers’ demand for these alcoholic beverages.

"This will mean that young people will not be able to afford as much alcohol as they currently do. Their $10 pocket money won’t be able to buy them a bottle of gin. They’ll drink less alcohol, get less drunk, and cause less harm."

But caught in the crossfire are the producers and consumers of wine-based products – such as sherry and port. While distilled spirits, particularly light spirits, can be produced at low cost, the same cannot be said of fortified wines. Unfortunately for the latter, they fall within the magic 14 to 23 percent alcohol range and are now subject to the same excise duty.

Many small winemakers have made considerable investments in sherry and port production and because these types of wine typically need time to mature, wineries have substantial stocks on hand.

New Zealand Winegrowers, the industry body for the country’s winemakers and grape growers, says the change in the excise regime will have a striking impact in the market, making it extremely difficult, if not impossible, for winemakers to sell the stock they have on hand.

"The financial impact of this could be disastrous, especially for smaller companies," says Chairman Peter Hubscher.

Henderson-based Pleasant Valley Wines, the oldest family-owned winery in New Zealand, has been making port and sherry for over 100 years. Owner Stephan Yelas says that while the company has just celebrated a milestone in terms of its centenary, it is the end of an era because they are pulling the plug on fortified wine production.

"We’ll just run stocks out now because we can’t see any money left in it. There’s no margin for profit any longer," he says.

New Zealand makes 1.2 million litres of port and sherry each year. While that only amounts to about 2 percent of the country’s total wine production, a string of family businesses in the Henderson area, many of which have been established for a long period of time, base their income on fortified wines.

Pleasant Valley will survive through the sale of its mainstay table wines, but Yelas agrees with Hubscher that other companies in the region, particularly the boutique wineries that focus primarily on port and sherry production, are likely to find the new excise duty very tough for business.

Yelas says he found out about the new excise duty like everyone else - "on the news." So was he annoyed when he heard? He says not as angry as the customers, who it turns out are "100 percent the older pensioners".

Indeed, the biggest market for sherry and port in New Zealand is the older generation. And that is why many critics say the new legislation simply defies logic, given that it is supposed to target youth drinking. One cynical commentator wrote that it is rather like attacking the high teenage pregnancy rate by taxing Viagra, or restricting boy racers by increasing the duty on diesel.

Hubscher says the elderly are bound to find the price increase of approximately $5 to $6 per bottle very hard to swallow, especially since most of them are on fixed incomes.

"This inflicts unnecessary hardship on people who have been contributing to our country for many decades and who are not part of the problem the new law purports to address," he says.

One suggestion in the Easton report states: "In order to maintain realistic minimum levels for the price of alcohol, either the base excise duty rate for all alcohol has to be raised, or a differential between spirits needs to be introduced. This reports recommends the latter option."

Winegrowers CEO Philip Gregan says essentially this proposes that light spirits should be taxed higher than other alcoholic beverages that fall within the 14 to 23 percent alcohol range. He says this would have made more sense than the adopted approach.

"There’s a fundamental difference between fermented beverages and distilled beverages," says Gregan. "That’s been recognised in past excise regimes. To be consistent, that logic needed to be carried through here. They haven’t though and by incorporating fortified wines they’ve blurred the line between distilled and fermented beverages."

Anderton’s rationale is that "this is necessary to ensure that these products [fortified wines] do not become an alternative source of low-priced, higher alcohol content beverages…"

Gregan thinks that is absurd. "Kids don’t drink fortified wines. The whole marketing profile and flavour profile is wrong."

And this isn’t the only reason Winegrowers is disgruntled. While the Government claims to have pushed the Bill through Parliament under such urgency so as to prevent one company gaining an unfair advantage over its competitor, Hubscher says the complete lack of discussion was a clear breach of a promise made by Anderton three months earlier.

"To make matters worse, this ill-conceived policy was rushed through without consultation – consultation the industry was promised in writing on more than one occasion by Jim Anderton in February of this year. It is a serious injustice that this promise was not kept," says Hubscher.

Investigate asked Winegrowers for a copy of Anderton’s letters but the request was declined on the basis that "it’s not in the public domain". However, we did find the following excerpt on Winegrowers’ website in which Anderton advises: "If we are to find the solutions to the problems we are exploring then it is crucial that these should be ones upon which as many as possible of the stakeholders can reach agreement. If we don’t take this approach then I doubt that we will succeed in our endeavours."

It is important to note that while the Government has adopted approaches outlined in his report, calling Easton the villain, as some commentators have alluded to, may not be the most objective reaction. Featured in the paper are recommendations and examples to "assist public discussion". In fact, he highlights it as an imperative.

"That it is a political judgement suggests the need for a wide public debate on the appropriate excise duty rate," writes Easton.

But since Anderton’s February correspondence, Winegrowers says it has had no consultation with the Government about the matter.

"We are fully supportive of the Government’s commitment to resolve the issue of excessive drinking by young people," says Hubscher. "We also agree with Mr Anderton’s letter that consultation with stakeholders is central to successful policy outcomes. Like him, we believe that the new regime will fail in its objectives because he has not taken key stakeholders with him on this issue.

"The policy will put some small winemakers out of business. It will make no contribution to solving the youth drinking problem."

By using less juice or less soft drink in the mix, young drinkers will get much the same effect as before, says Hubscher, and he predicts that the producers of light spirits will simply change their products to have 13.9 percent alcohol to bypass the new rules.

Independent Liquor, New Zealand’s largest light spirits producer, has done exactly that. It has reformulated its range of drinks to have an alcohol content of 13.9 percent in a move reported to have been "unashamedly aimed at beating" the teen-tax.

And if concern about the social impact of youth drinking is the real issue, why has the Government not attacked teenagers’ "drink of preference" – the sickly-sweet, brightly coloured, lolly-water beverages referred to as alco-pops or RTDs?

"Light spirits are of greater concern at the moment than alco-pops as the price of light spirits currently allows young people to purchase a greater quantity of alcohol for a less amount of money," is Anderton’s reply.

There’s a clear consensus, spoken on talkback radio and voiced in the odd editorial – the new tax will prompt a short-term reduction in youth binge drinking but it is not a long-term solution.

"Government should be addressing the question ‘why do young people or indeed any New Zealanders binge drink?’" says Robertson. "Instead they have a simplistic view that the price they pay for alcohol is their major driver to binge and it will be fixed by increasing the price, and that’s simply not the case."

Groups opposing liquor advertising aimed at young people report that it is the commercials that have lead to more teen binge drinking. Given that the Herald recently revealed that liquor companies received "mate’s rates" from government-owned Television New Zealand, to encourage intense advertising, it is hardly surprising that people are struggling to understand the logic behind the latest move.

Robertson is one of many who argue that the Government would be concentrating on more fundamental questions if social interest was the priority. Others see it as a little contradictory that a ‘conscience vote’ in Parliament led to the lowering of the drinking age in the first place, and some say the lack of consultation was a flouting of the democratic process.

However, it is hard to argue with the underlying principle, or indeed the statistics, that teenage binge drinking is a serious concern, not just for the healthy development of that cohort, but also for society as whole. And yet, it is an issue that most agree necessitates action that actually hits the mark - a more measured response than the impromptu measures carried through a sleepy Parliament that night. Instead, says Robertson, "Government has used a sledge hammer and missed the target."

Posted by Ian Wishart at 01:04 AM | Comments (0)