Ending the sale of energy drinks to children and young people: consultation analysis

4. Impact assessments

Business and Regulatory Impact Assessment

4.1. The consultation paper suggests that mandatory age restrictions would create a consistent approach across both retail and out of home sectors and that this would ensure a level playing field and mitigate any competitive disadvantage that currently exists with the voluntary ban.

4.2. The paper also notes that the Scottish Government is seeking to reduce the purchase and thereby consumption of energy drinks by young people. The likelihood of an impact across the energy drink industry would increase with the levels of success of the policy. This would include manufacturers where these products constitute a significant proportion of turnover.

For sellers only:

Question 5: If you have implemented age restrictions for energy drinks, please describe any effect, positive or negative, that this has had on your business.

Question 6: If you do not have age restrictions in place for energy drinks, please describe any effect, positive or negative, that implementing such restrictions would have on your business.

4.3. Six retailer or retailer representative body and two individual respondents commented at Question 5. Two of the retailer or retailer representative body respondents also went on to comment at Question 6. A single analysis across the two questions is presented below.

4.4. One retailer respondent reported that when they implemented a voluntary ban (in March 2018), they drew on the experience of restricting the sales of alcohol to under 18s to ensure their approach to energy drinks was equally robust. They went on to set out that:

• Their approach is enforced using a 'Think 25' policy which was introduced in 2009 and was specifically designed to ensure that underage shoppers are not exposed to inappropriate products.
• They have retrained all checkout staff to apply Think 25 to any customers trying to purchase energy drinks.
• Products identified as energy drinks also have a system flag applied so that when they are scanned through the till a prompt appears requiring staff to confirm that the customer is over age.
• The voluntary restriction does not have an impact on their online delivery service because all customers must be over the age of 18 to receive, inspect and sign for a grocery order.

4.5. This retailer went on to comment that:

"We believe that this simple and cost-effective system can support all retailers of any size who currently sell alcohol to roll-out the implementation of an age based restriction to energy drinks."

4.6. Another retailer respondent, along with a retailer representative body respondent, commented that the introduction of any measure of this type requires financial investment arising from system changes and training to set up procedures for age verification, as well as additional transaction time resulting from these checks.

4.7. The retailer also reported that they have lost sales to young people aged under 16 who previously bought these products and to some 16 and 17-year olds who were unable to prove their age. However, despite these costs, they believe that limiting the sale of these products by age is the right thing to do. A retailer representative body respondent also confirmed that members who are already enforcing the ban report that they have, as intended, seen a fall in the sales of energy drinks. Another retailer representative body respondent reported that feedback from a small survey sample of their members suggested that the impact of introducing a minimum age policy would be minimal to their members' businesses.

4.8. However, they did comment that some of their members had reported instances of anti-social behaviour from consumers who were unable to provide proof of age. There was a call for Government to ensure that any new measures are communicated using all applicable media channels.

4.9. Other comments addressed sales through vending machines, with two retailer or retailer representative body respondents suggesting that most vending machines in workplace settings should not be subject to age restrictions because there are generally no under 16s on site. They commented that:

"Implementing general or vending specific restrictions would have an unnecessarily significant impact on business profitability for 'us /our members'. It would also cause unnecessary friction with our members clients, who would not be happy on any restriction of product sales to adults."

4.10. Finally, a small number of retailer or retailer representative body respondents commented on the uniformity of policy, including that retailers treat the UK as one market and that any mandatory age restrictions placed on energy drinks should be UK-wide.

Question 7: What, if any, impact do you think applying mandatory age restrictions to sales of energy drinks would have on businesses?

Please include any anticipated differential impacts, positive and negative, on sellers, distributors and manufacturers of energy drinks.

4.11. A total of 63 respondents (25 organisations and 38 individuals) answered Question 7.

Volume of sales

4.12. Comments on this question tended to be brief, with a small number of respondents, including some individuals, simply suggesting either that they did not think mandatory age restrictions on the sales of energy drinks would have any impact on businesses or that any impact would be minimal. This was sometimes connected to a proportion of businesses already operating a voluntary ban on the sales of energy drinks to under 16s. A health focused campaign organisation reported that some retailers, all publicly-owned leisure centres across Scotland and NHS establishments have already implemented voluntary age restrictions for under 16s.

4.13. One NHS respondent cited the recent evaluation of the Healthcare Retail Standard (HRS)^[15] as reporting that overall sales initially fell following implementation of the programme. Managers noted that this was affecting their profits, but as new products have been trialled, sales have started to improve. They went on to comment that, whilst accepting that the HRS applied to all food and drink sold and not energy drinks specifically, its impact is indicative of a probable impact on sales if a ban on the sales of energy drinks to children and young people is applied.

4.14. A manufacturer respondent reported that the only brand they have which is classified as high in caffeine accounts for 0.15% of their total sales and that, having sought to ensure the product does not appeal to under 16s, they do not believe the sales ban will have an impact on that brand.

4.15. Leading on from some retailers having already implemented a voluntary ban, health focused campaign organisations and royal college respondents were among those who suggested that by introducing a consistent approach across all retailers, a statutory age restriction would create a level playing field for all sellers. A health focused campaign organisation also commented that this will be enhanced by including all out of home and online sales, as well as promotional giveaways.

4.16. Other comments relating to a limited impact on businesses included that children or young people will be likely to shift to other soft drink purchases should energy drinks not be available. It was suggested that marketing and sales opportunity will still exist for all sellers, with the surge in the number and total sales of lower sugar products seen after the introduction of the Soft Drinks Industry Levy cited as an example of how the market can adapt. A health focused campaign organisation commented that:

"Restrictions only serve to promote innovation and evolution for food and drink companies, and encourage them to reformulate or produce new products that are not liable for restrictions."

4.17. In terms of types of businesses that would be affected, a local authority respondent said that these will include retailers near schools. A health focused campaign organisation referred specifically to the local, independent and convenience stores and fast food takeaways that may not currently apply a voluntary ban. However, an NHS, HSCP or local authority respondent suggested that many young people will still want to go to local shops and choose to spend any money saved on energy drinks on alternative products. While a local authority respondent thought that a ban could have a positive benefit to local businesses around a school as they could be part of the effort to promote improved health policies within their community. A different perspective, also from the NHS, HSCP or local authority respondent mentioned above, was that school meals services may gain extra customers in the case of young people whose primary motivation for leaving school at lunchtime was to purchase an energy drink.

4.18. Finally in relation to impact on sales, a small number of primarily individual respondents commented that, while they understood that there could be an impact on businesses, they did not consider this important, particularly relative to the potential to improve the health and wellbeing of children in Scotland. An individual respondent also suggested that a decrease in the sales to young people could lead to price increases which, if resulting in decreased sales to others, could be beneficial for the nation's health overall.

Other types of impact

4.19. A small number of respondents, including manufacturer or manufacturer representative body respondents, a retailer representative body, a health focused campaign organisation, a royal college and a local authority respondent commented specifically on the impact of a ban on sales to under 18s.

4.20. A manufacturer representative body raised concerns that such a change would lead to significant reputational damage by unfairly and incorrectly putting energy drinks into the same category as alcohol and tobacco. A manufacturer who noted that they do not market or promote energy drinks to under 16s, commented that if a ban on the sales of energy drinks to under 18s is taken forward:

"...the reputation of the sector could be seriously affected...it would be impossible for manufacturers to predict the business impact and reputational implications that this would have."

4.21. Some other comments, including those from a health focused campaign organisation, a royal college and a local authority respondent reflected themes covered at previous questions, and at Question 3 in particular, including in relation to age verification processes. Their perspective was that as processes already exist for the sale of other age-restricted products, a ban on the sales to under 18s would be the most practical and easiest to implement for retailers.

4.22. An alternative perspective, from a manufacturer and a retailer representative body, was that carrying out age verification checks would place an onerous and disproportionate burden on sellers. This would be particularly onerous because there is no requirement for individuals to carry any form of ID. An associated concern raised by a local authority respondent was that, with the sales of most age-restricted products being restricted for under 18s, an under 16s restriction may add to confusion over which products can be sold to whom.

4.23. In terms of implementing any ban, it was suggested that retailers would incur costs including in relation to staff training, developing training materials, and developing consumer awareness materials such as posters to display in‑store about the age restriction.

4.24. A manufacturer representative body noted that, at present, the soft drinks supply chain is highly integrated across the Republic of Ireland and the United Kingdom. Concerns were raised with respect to the prospect of regulatory divergence from the existing EU framework on energy drinks, particularly in the context of Brexit. The same respondent suggested additional regulation from Scotland on energy drinks has the potential for a significant adverse effect on trade between Ireland and Scotland.

4.25. It was argued that the existing EU Food Information Regulation 1169/2011 requires specific labelling for drinks with high caffeine content and that additional regulatory controls should not be introduced without robust scientific evidence.

Health Inequalities Impact Assessment

4.26. The consultation paper notes that consumption rates for energy drinks are higher in areas of deprivation and that a mandatory age restriction could help to reduce health inequalities. It suggests that having a consistent approach across Scotland would mitigate any differential impacts that relying on voluntary action can have on young people from different areas.

Question 8: What, if any, impact do you think implementing mandatory age restrictions to sales of energy drinks will have on people based on any of the following characteristics:

Age, Sex, Race, Religion, Sexual orientation, Pregnancy and maternity, Disability, Gender reassignment, Marriage or civil partnership, Socioeconomic disadvantage.

Please consider potentially positive, negative and differential impacts, supported by evidence, and, if applicable, advise on any mitigating actions we should take.

4.27. A total of 56 respondents (20 organisations and 36 individuals) answered Question 8.

4.28. Comments at this question tended to be brief, with some respondents simply saying that they did not think a ban would have any particular impact on people based on the characteristics set out, including because it would have a positive impact for everyone.

4.29. Most frequently, respondents including health focused charity or campaign organisations, health professional unions or royal colleges, NHS, HSCP or local authority respondents and individuals thought a ban would have an impact based on the age characteristic. They saw the impact as being positive, with further comments including that, given the age-specific nature of the proposal, children and young people would benefit. These benefits tended to be described in terms of health benefits, including in relation to reduced rates of childhood obesity.

4.30. A connected point made by a health focused campaign organisation respondent who thought the proposal would have a positive impact based on age was that, if the mandatory age limit is set at 16, this could negatively impact 17-year olds who, they reported, are more likely to consume higher volumes of energy drinks. They went on to suggest that setting the age limit at 16 years old could have a particular negative impact on the health of 17-year-old boys who, it was reported, consume more energy drinks than girls. A health professional union suggested that the marketing of energy drinks is aimed predominantly at young males.

4.31. An alternative perspective from a manufacturer was that implementing a ban on sales to under 18s would unfairly restrict those aged 16 and 17 from choosing a safe, functional product.

4.32. Carrying out a Child Rights and Wellbeing Impact Assessment to consider how the policy will impact on the rights and wellbeing of children and young people was proposed. It was suggested that such a systematic assessment would provide both an understanding of the benefits and a benchmark for the assessment of impact in the future.

4.33. After age, socioeconomic disadvantage was the protected characteristic on which respondents thought a ban could have an impact. Comments often focused on links between obesity and socioeconomic status and resulting consequences for health inequalities. It was noted that research indicates that children eligible for free school meals are more likely to be frequent consumers of energy drinks. A health focused charity respondent reported that obesity is twice as prevalent among children in the most deprived areas of Scotland and went on to sum up their position by commenting that:

"Population-level interventions, such as banning the sale of energy drinks to children, are likely to have the most positive effect on health inequalities. Tailored interventions for specific groups may only lead to behaviour change among more affluent groups, but population-level activity is more likely to benefit the most deprived communities where obesity rates are highest."

4.34. The other two characteristics which respondents identified as potentially relevant were pregnancy and maternity and disability. With regard to pregnancy and maternity, a health professional union reported that current UK Government advice recommends restricting caffeine intake during pregnancy to no more than 200 milligrams per day. They suggested that restricting sales of energy drinks could have a positive impact in limiting intake of caffeinated drinks.

4.35. With reference to disability, the same respondent went on to suggest that people with a learning disability may not understand the health issues around consuming energy drinks. Restricting sales could have a positive impact in reducing access for those with a learning disability who have difficulty making healthier choices.

4.36. Other comments referred to medical conditions, and included the suggestion that some people, including some people with attention deficit hyperactivity disorder (ADHD), use energy drinks to self-medicate.

Question 9: Please outline any other comments you wish to make.