UPDATE 1-UK's Cameron favours minimum alcohol price-report

Wed Dec 28, 2011 11:49am EST

LONDON Dec 28 (Reuters) - Prime Minister David Cameron has ordered officials to draw up plans to set a minimum price for alcohol to discourage excessive drinking, a British newspaper reported on Wednesday, although the government said no decision has been taken.

The Daily Telegraph said the officials have been told to develop a scheme to prevent the sale of alcohol in shops in England at below 40 to 50 pence (63 to 79 U.S. cents) per unit.

That could lead to sharp price rises, particularly for cider and some spirits.

The Scottish government has already announced plans to set a minimum price to tackle alcohol abuse, which kills thousands of Britons each year.

The British government could decide either to copy the Scottish proposals in England or to introduce a system of taxes based on the number of units of alcohol in a drink, the report said.

Both options would cost drinkers an additional 700 million pounds ($1.1 billion) a year, with any extra tax revenue potentially going to the state-run National Health Service, it said.

A government spokesman said the coalition would continue to review all available evidence on how to tackle alcohol abuse.

"Our alcohol strategy, which we will set out shortly, will outline what further steps we are taking to tackle this problem. No decisions have been made," the spokesman said.

The Daily Telegraph quoted a government source as saying Cameron was "keen on the minimum price", but said the Business Department had warned that forcing firms to charge a minimum price could be illegal under European Union law. It said the government would publish its alcohol strategy in February.

Kristin Wolfe, head of alcohol policy at global brewing giant SABMiller, said the company supported the British government's aim of tackling problem drinking, but said minimum pricing would be "ineffective, unfair and illegal."

"The evidence shows that minimum pricing will hardly affect the consumption of hazardous and harmful drinkers, but will hit the vast majority who drink responsibly and in moderation," Wolfe said in a statement.

Extra tax revenue could be attractive for the government, which has embarked on an austerity plan to curb a big budget deficit.

Britain's health cost watchdog urged the government last year to set a minimum price for alcohol and consider an advertising ban to reduce alcohol abuse.

The former Labour prime minister, Gordon Brown, rejected a call from Britain's chief medical officer in 2009 to set a minimum price of 50 pence per unit of alcohol.

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