Response to interpellation 2022/23:337 on the costs to society for the introduction of farm sales
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
The debate concerned the costs to society for the introduction of farm sales of alcohol. KD views small-scale farm sales positively but emphasizes the importance of safeguarding the retail monopoly 1 2 3. KD argues that the socio-economic costs of alcohol are extensive and that the specific costs for farm sales are relatively small in that context 1 2. KD points out that the supervision shall be fee-financed by the producers 2. S argues that the current proposal is too extensive, covers urban areas, and could threaten Systembolaget's monopoly 4. S emphasizes that the costs of alcohol's harmful effects are very high and questions whether it is economically wise to let these costs increase 4 5 6.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Socialministern Jakob Forssmed (KD)
Madam President! I have been asked if I consider it a wise economic prioritization for society to pay at least between 87 and 150 million kronor per year to allow individual manufacturers to sell their alcoholic beverages at the manufacturing site. Karin Sundin has also asked me from which appropriation in the state budget the funds for these costs should be taken in that case.
The report of the Farm Sales Inquiry (S 2020:15) A possibility for small-scale farm sales of alcoholic beverages (SOU 2021:95) has been submitted for consultation, and a large number of consulting bodies have responded to the referral. The usual work of processing the consulting bodies' views is ongoing. In this work, among other things, the complexity of the issue and the conceivable consequences need to be considered.
The Government views it positively to enable small-scale farm sales of alcoholic beverages, provided that the retail monopoly is protected.
Karin Sundin (S)
Madam Speaker! I thank the Minister for Social Affairs for the answer, even though I note that I have actually not received an answer to the question itself.
I will start by saying that the proposal for farm sales that is now on the government's table is not quite what we think it is. I believe that most imagine that it is about the opportunity to visit a farm somewhere in the Swedish countryside where alcoholic beverages are produced in an artisanal way and that during that visit one should be able to buy a bottle to take home, just as we do when we visit wine districts in Italy or in France – and that is very pleasant. We can imagine the farm with rolling grain fields, the wind rustling and the sheep bleating in the pasture next door. I believe that is the image we have in front of us if we talk about farm sales. That is the way one understands the concept of farm sales.
If it were really that way, farm sales would be a fine way to develop the tourism industry and a good way to promote a living countryside and local producers. Such limited farm sales would likely not affect either public health or Systembolaget's future.
But, Madam Speaker, it is not such a proposal that is on the table and that the Minister and I are discussing today. The proposal that is on the table covers retail of alcoholic beverages that takes place at the manufacturing or cultivation site regardless of where in Sweden it is located. It also covers manufacturing that takes place in urban areas and in cities. In that case, there will be many places - the investigator estimates it concerns 800 places, and most of them are located precisely in urban areas and cities. We are therefore talking rather about metal sheds in industrial areas than about farms in the countryside.
Why is this then important? It is important because the proposal on farm sales is so extensive that many legal experts believe that it is actually not compatible with Systembolaget as we have it today. Therein lies the actual core issue. Therein lies my party, the Socialdemokraternas, great concern regarding the proposal that Minister Jakob Forssmed now has to handle.
To this is also added the cost of the reform that is on the table. It is very high. We must also talk about the proposal in economic terms.
The debate so far has been about that other thing, which I spoke about just now. But we must talk about the money. How much should society pay so that it is possible to go and buy alcohol somewhere other than at Systembolaget or at restaurants and bars? What is a reasonable price for such a reform?
The government investigator estimates the tax revenues from farm sales to be between 137 and 148 million kronor in 2025. The same investigator estimates society's costs for the increased availability of alcohol to be between 235 and 287 million kronor. These are then costs for premature deaths, for reduced quality of life, for care and treatment, for production loss, and for crime.
For those who are not super fast at mental arithmetic, I can say that the difference between the tax revenues for the reform and the costs to society for it, according to the investigation, will be at least 87 million kronor per year and perhaps as much as 150 million kronor per year. I consider that to be a huge amount of money, at least considering the benefit we would get for that money.
My question to the Minister remains. Does the Minister consider it economically wisely prioritized that society should pay between 87 and 150 million kronor per year to allow individual manufacturers to sell their alcoholic beverages at the production site?
Socialministern Jakob Forssmed (KD)
Madam Speaker! Thank you, the interpellor, for these questions! The figures that the interpellor mentions are, first of all, from the investigation. Now the government is preparing the issue in the Government Offices. That includes taking in referral views and conducting a review. This is a complex issue where one needs to take a long series of things into account.
The figures mentioned are not quite comparable. One is a public finance revenue, and the other is a socio-economic cost. These are not costs that can be immediately attributed to any item in the state budget, for example, regarding quality of life or premature deaths.
One should also note that the harmful effects of alcohol in society are very extensive. There are large socio-economic losses that occur as a result of alcohol consumption and alcohol use of various kinds. The sums that the interpellor describes are relatively small in that context - if one compares them with the large harmful effects.
It is important to have a good alcohol policy that limits the harmful effects. In that regard, Systembolaget's monopoly, the retail monopoly, is particularly important and a central cornerstone. Therefore, it is desirable for the government that, when we work on this issue with the positive approach of enabling this, we also ensure that we safeguard Systembolaget's monopoly.
Karin Sundin (S)
Madam Speaker! It is absolutely true that this is about society's costs. We know quite well what the harmful effects of alcohol cost, and it costs above all in human suffering. We know that alcohol is one of the primary risk factors for disease and premature death and that alcohol causes approximately 5 percent of the total disease burden in Sweden. This can, therefore, be translated into economic terms, seen in production loss. It concerns both physical and mental ill-health. It is possible to convert society's costs into economics.
We know that many children are suffering. It is harder to translate into economic terms. How do you measure a lost childhood in kronor and öre? It is not possible to do that.
But at the same time, we must manage to talk about the costs to society, and we have an investigation on the table. The investigation has economic calculations for the costs. It is about the direct costs, that is, for example for healthcare and the justice system. But it is also about the indirect costs that the Minister cites, where ill health and illness, of course, are harder to monetize. Then we are talking about a cost to society of 103 billion. That is the latest calculation available of what the harmful effects of alcohol cost.
But now we are to take a position on a reform that adds costs on top of these 103 billion. It is likely a higher cost today - the calculation is from 2019, and the development has continued in a negative direction. The cost is therefore likely higher.
In the investigation, it states very clearly. The costs of the harmful effects of alcohol have been calculated, and they cannot be translated to an overall societal level. It is not possible to attribute this to individual individuals. It is not possible to say that it was the farm sale that caused Karin or Jakob not to come to work the next day or that we developed an addiction. It is not possible to say that it was the farm sale that caused Karin or Jakob to end up in a fight and need medical care.
But the government has a reform on the table, and it is said that the costs will increase by between 87 and 150 million kronor. This has been on consultation, and the responses that have come in show very clearly what the authorities and the municipalities, who are to take responsibility for ensuring the reform is implemented, believe. They argue that the investigation has significantly underestimated the costs of introducing, maintaining, and exercising supervision over the sale of farms as the proposal is designed. If one is to believe the authorities and municipalities that will be given responsibility for this, the cost will therefore be significantly higher than that which has been calculated in the investigation.
We actually need to ask ourselves: Is this reasonable? And I ask the Minister, Madam President of the Government: Is it reasonable, and from where shall society's resources be taken? It is not as if there are no needs in other budget areas under the Ministry of Social Affairs' responsibility. How is this to be financed? In what way shall we be able to finance a reform that further increases society's costs for the harmful effects of alcohol?
Socialministern Jakob Forssmed (KD)
Madam Speaker! I want to begin by saying that these are the investigation's calculations. They are based on a number of assumptions. There are, of course, reasons to scrutinize this when preparing the issue, but it is not that simple. Public finance costs and socio-economic costs are, after all, two different things. And as the interpellor and I myself note, the costs referred to in this context are relatively small compared to the total costs of the harmful effects of alcohol. This also needs to be taken into account in the analysis. The preparatory work is primarily focused on the question of the retail monopoly. It is, in fact, very important to safeguard this, as the government has stated several times.
Regarding the supervision, it shall, according to the commission's proposal, be fee-financed. It will therefore need to be paid for by those who produce beverages in accordance with the commission's proposal.
But it is, of course, important to highlight issues from all different perspectives. We are doing that now in an extensive and thorough preparatory work, which is taking place at a high pace at the ministry.
I might as well take the opportunity to ask Karin Sundin and the Socialdemokratern what their view on this issue is. I have heard that they have no principled objection to this and would gladly see it implemented. Then the question can also be posed to the Socialdemokratern and to Karin Sundin. I wonder how they view the costs that Karin Sundin herself points out in this context. It is said that they have no objections, in principle, to introducing farm sales of alcohol.
Karin Sundin (S)
Madam Speaker! I said this in my opening statement. Farm sales are likely perceived by many as limited sales in rural areas, which would promote a living countryside and local production - that is what the term implies. I do not believe that would pose any major threats to either public health or the retail monopoly. But that is not the proposal that is on the table.
I have not said that the question is simple. I have not said that the costs should not be seen in relation to the total societal cost of the harmful effects of alcohol. But between 87 and 150 million kronor is a lot of money.
At its core, this discussion is about whether the Council of State and the government are considering the costs of the harmful effects of alcohol, which will arise if we introduce a system for farm sales as the investigation has designed it, which is very extensive. The question is whether the Council of State and the government care at all about the fact that the costs exceed the estimated revenues.
I will say again that money is a blunt measure in this context. Human suffering is difficult to measure in money, because it is fundamentally about illness and death, about damage and assault, and about frightened children and battered children. But if no other arguments take hold in the debate, the blunt economic arguments usually do.
Money should be of importance when we talk about the design of the alcohol policy. This should be of importance when we talk about the utility of the retail monopoly. And it should be of benefit when we talk about how the EU will assess this: Will Sweden manage to maintain the exemption for Systembolaget if Sweden introduces farm sales?
But I must say that after this debate, I am not quite clear on whether the government truly understands the value of money in this context. It cannot be that the farm sales are allowed to cost whatever they want, especially not measured in money. These are important issues. It is about people's lives and health.
Socialministern Jakob Forssmed (KD)
Madam President! Thank you, the interpellor, for the questions here today! It is naturally extremely urgent and important that we shed light on the issues regarding the harmful effects of alcohol and the costs that arise in society as a result of this.
It is important to have a policy that counteracts these harmful effects, and therefore it is essential for the government that we safeguard the retail monopoly in this process. It is an important component, not least for limiting the harmful effects that the interpellor highlights here in the debate.
Of course, the government understands the value of money. But the human dimensions of this are extremely important, just as the interpellor also emphasizes. Since it is referred to that money should be taken from the state budget to compensate for the costs, I would nevertheless like to point out in that context that public finance costs and socio-economic costs are different things. That is not how these calculations are made; it is about other things.
The government's main calculations are not about expected tax revenues or anything of the sort, but rather it is about the fact that there is a demand for small-scale farm sales. It is something that the government views positively, while at the same time we work under the premise that we can safeguard Systembolaget's monopoly, which is very important in relation to the problems and concerns that the interpellator describes.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.