Costs of alcohol in New Zealand's antipodes

Chris Snowdon over at Velvet Glove points to a new Scottish study of the social costs of alcohol, reported on by Alex Massie of the Spectator.

A quick flip through the report suggests some pretty familiar problems: most prominently, counting as social costs a host of private costs. Where the Scottish piece suggests costs of about 3.5 billion pounds, it looks like an economic measure of external costs would be somewhere between a quarter and a third of that value. I'm not going to spend a month on it like I did with the BERL study (see here and here). But some cursory notes:

• the costs of anti-alcohol initiatives are counted as a cost of alcohol: so if funding for alcohol treatment centres doubled, the cost of alcohol would increase
• Costs of social care are based on the proportion of families where social workers think alcohol is a problem, not the cost reduction that could be achieved in the absence of alcohol (as alcohol is only one of many problems for many such families)
• crime costs seem to be counted whenever survey suggests 'drunk as one of the reasons for crime', but we can never really tell what proportion of those would have occurred for the other reasons even if alcohol hadn't been there
• it looks like they're counting all forgone wages as being social costs; they've made a passing note to that they're private costs if labour markets are "perfect", but then seem to go on to assume all costs can be counted as social because markets aren't "perfect" (rather than just counting a portion of them as social to reflect the degree to which markets aren't perfect; they also assume alcohol-affected workers are employed at average wage rates rather than being concentrated in the lower brackets.

Somebody who wanted to spend a month reverse-engineering their figures and applying sensible method could likely knock the costs back to somewhere south of a billion pounds as a rough estimate. We knocked the BERL study back by rather more than that, but the Scottish piece seems to have avoided some of BERL's sillier methods.

The bulk of the mortality costs would properly count as internal costs for drinkers (save for victims of crime or victims of drink drivers who weren't in the drink driver's vehicle), so that 1.46 billion would knock back to somewhere around 100m, most likely; productive capacity costs would likely knock back to about a tenth of the reported figure; crime costs for matters other than alcohol-specific offences should be knocked back by at least a third. A rough ballpark for an 'external cost" figure would be between a third and a quarter of what they're reporting. It could be lower than that, but I'm not going to spend a month on it.

I can't quickly find the Scottish excise tax take, but the take for the whole UK is 11.5 billion pounds as of 1999-2000 and Scotland is about 8% of the overall population, so ballpark excise tax revenues in excess of about a billion pounds (since they'll have risen in the last decade).(Updated, see below) So, again, external costs are roughly at the level of the excise tax take.

Of course, the Scottish government views the figures as plainly demonstrating the need for ever more stringent controls on alcohol.

Yet more cost reports whose function is agitprop.

Update: Chris (in comments) very usefully notes alcohol excise taxes of £768m (which I still think likely close to what a corrected figure on external costs would look like). I think that includes Scotland's proportionate share of excise duties collected on imported alcohol, but I'm not completely sure.