Bottle store battle: MPs warned that law changes may stifle community objections

The fraught process of deciding where and when alcohol can be sold in New Zealand is under review. Could proposed changes make it worse?

A law change which is meant to make it easier for communities to have a say about new bottle stores in their neighbourhoods may end up doing exactly the opposite, community groups say.

Parliament is considering changes which aim to balance the playing field in liquor licensing decisions, following long-held concerns that the existing regime unfairly favours the alcohol industry and retailers.

While community groups, social services and public health advocates broadly support the changes, there are concerns about new powers for the committees which make decisions about alcohol licences.

Those powers include the ability to stop some people from presenting at hearings and to strike out evidence or submissions.

“This bill gives community participation with one hand and takes it away with the other,” said Māori warden Mereana Peka.

The law change is also being criticised by the liquor industry, supermarkets and retailers for tipping the balance too far towards objectors.

They have warned MPs that the measures will lead to a flood of objections against liquor licences and will remove important checks on councils when they make rules about alcohol.

What is the problem?

Reforms under the previous National Government in 2012 aimed to give local communities more power in deciding how alcohol was consumed in their neighbourhoods.

This was partly by allowing councils to develop Local Alcohol Policies (LAPs) which set limits on where and when beer, wine and spirits could be sold.

But 11 years on, many councils have struggled to introduce their own rules, mainly because of challenges by the liquor industry and supermarkets.

Communities have also complained about the hurdles to challenging a new bottle store or pub in their area.

The licensing hearings can be overly-formal and adversial, advocates said, with relatively naive members of the public being cross-examined by experienced lawyers.

The criteria for objecting is relatively narrow, requiring objectors to live within 2km of a proposed licence-holder. Principals, iwi and medical experts have been blocked from submitting.

Some felt this had contributed to a proliferation of bottle stores in areas where alcohol harm is prevalent, like South Auckland.

In the last five years, just 22 of 7000 liquor licences in New Zealand’s major cities have been declined.

People who have tried to prevent liquor stores opening near schools or daycares say they have struggled to be heard under the current licensing system. Photo / NZME

What’s happening now?

The bill before Parliament would remove some obstacles to introducing Local Alcohol Policies, broaden the criteria for participating in licensing decisions, and make licensing hearings more accessible.

At the moment, alcohol companies, police and public health organisations can lodge an appeal against an LAP if they feel it goes too far or not far enough. That appeal function is now being removed.

Anyone will be able to object to a licence or a renewal application, even if they are not personally affected by it. This will be balanced out by new measures which allow District Licensing Committees (DLCs) to manage objections.

People will also be able to contribute remotely to hearings, and cross-examination will no longer be allowed - only committee members will be able to question attendees.

What does the industry say?

The liquor industry, supermarkets and retailers are generally opposed to the changes, saying they will not reduce alcohol-related harm, that they tip the balance too far towards objectors, and could lead to established businesses losing their licences.

The appeals process was an important check on council decision-making, said DB Breweries corporate affairs director Lauren Mentjox. “They don’t always get it right.”

Spirits NZ chief executive Robert Brewer said little would change because LAPs in Auckland and Wellington had been delayed not by special appeals but by judicial reviews. Judicial reviews would still be permitted under the law changes.

Many expressed concerns about a provision which would allow licence renewals to be assessed against local alcohol policies. Foodstuffs NZ’s legal consultant Mike Brooker said that applying new rules to existing businesses was like “having the rules changed against them mid-match”.

Companies also wanted to retain cross-examination in licensing decisions, saying some scrutiny was necessary.

“Cross-examination helps get to the truth,” said Mentjox, from DB Breweries. “It can be scary, but any forum like this can be scary.”

Brooker, from Foodstuffs, suggested that cross-examination could be removed for members of the public but allowed for professionals or expert witnesses.

Supermarkets could be caught out when they reapply for their liquor licence under a new law change, a lawyer for Foodstuffs said. Photo / 123rf

What do community groups say?

Public health and addiction experts, community groups and non-government organisations (NGOs) welcomed the changes. They said it would remove one of the obstacles to introducing LAPs, give communities greater voice about alcohol in their area, and make hearings less intimidating.

The Salvation Army said the LAPs appeals process had helped the supermarket duopoly and liquor industry to delay and hinder policies which had been proven to reduce alcohol harm.

Community groups were strongly in favour of allowing anyone to submit at a licensing hearing.

They also backed the removal of cross-examination.

“It is combative, undermines people speaking from their heart, and it is a skill that only very skilled lawyers can use properly,” said Grant Hewison, from Communities Against Alcohol Harm, a South Auckland-based advocacy group.

But there was widespread opposition to new, greater powers for District Licensing Committees to decide who might submit or whether to strike out evidence.

“If that stays, our fear is that will create an even bigger obstacle to community participation than the current... requirements,” said Hewison.

The Salvation Army said these provisions were “vague, subjective and thwart community participation”. It added that committees could already manage submissions with their existing powers.

“The new powers of DLCs to exclude objectors are worse than what is used now and if they remain, they will defeat the very purpose of the bill - to increase community participation,” said Turehou Māori Wardens, who are based in Ōtara.

What happens next?

A select committee will report back with any recommended changes to Parliament in mid-June.

The bill was supported by Labour, Greens and Te Pāti Māori at the first reading, and was opposed by National and Act.

It was meant to be the first of two stages of alcohol reform, with the second part dealing with weightier issues like alcohol pricing, sponsorship and advertising.

But the second part has been dropped by Prime Minister Chris Hipkins as part of his promise to focus on “bread and butter” issues.