Saturday, 4 July 2009

Palmer on BERL

The NBR report referred to in the previous post, also contains a comment on Sir Geoffrey Palmer's view of the BERL report. The NBR says
Sir Geoffrey has now said to NBR that he sought Treasury advice on the issues in the Berl report on 22 May 2009, “long before the report by the two economists that stimulated your article appeared. Furthermore, at the same time I secured further advice from another independent economist.”

In a speech to police in Nelson on 24 April, Sir Geoffrey quoted headline figures in the Berl report of $5.296 billion in social costs of alcohol (and drugs), versus the alcohol excise tax take of $795 million, as a basis for his preferred policy option of significantly raising excise taxes to cover the shortfall.
But if he only asked for advice on the BERL report in May, why was he making statements based on the report in April? Why use the report if you are not sure of its findings? And why ask for advice if you are sure of the findings?

Also the NBR reports Sir Geoffrey as saying,
"It does seem that the case for increasing the price of alcohol to ensure drinkers contribute more to the costs imposed on society is persuasive."
But he seems to have missed the entire point of the Burgess and Crampton comments, the costs of drinkers to society aren't as large as BERL claims. In fact the current level of taxes may cover those costs. As Eric points out in the comments I miss read the NBR article. The quote above comes from the April 24th speech and is not a recent comment. With luck therefore Sir Geoffrey will have read Burgess and Crampton by now and thus will not be repeating the quote above in the future.

1 comment:

Crampton said...

I read that as quotes from the April speech. Was I wrong?