An examination of the likely impact of the Nicholson Report on the licensed trade sector

Despite the number of leaks in the press beforehand, it is remarkable how wide of the mark much of the advance reporting of the Nicholson Committee Report (“Nicholson”) was. Anyone whose thoughts on Nicholson have been formulated by media reports may be in for a surprise.

The committee was set up in June 2001 to: “Review all aspects of liquor licensing law and practice in Scotland, with particular reference to the implications for health and public order; to recommend changes in the public interest; and to report accordingly.” The last such exercise was carried out by the Clayson Commission in 1973 (“Clayson”). This was a far-seeing report, probably ahead of its time. Those who promulgated the legislation which followed adopted a half-hearted approach to Clayson, providing us with the muddle enshrined in the 1976 Act. It is reassuring to see many of the principles put forward by Clayson actively approved of and followed by Nicholson.

The first recommendation is that the legislation should contain certain guiding principles. Recommendations which follow suggest that the Scottish Executive, licensing boards, new statutory bodies such as local and national licensing fora, and appeal courts should have regard to these. They are (a) prevention of crime or disorder; (b) promotion of public safety; (c) prevention of public nuisance; (d) promotion of public health; and (e) protection of children from harm. This is all fine; however, when setting out seven guiding principles for itself, the committee stated first of all that “the licensing system should be as free from restrictions as possible”. Given that many of the trade’s frustrations arise from stupid conditions imposed by boards and officials, and given that many of these are now to be subject to appeal, it would be nice to see this principle in the legislation also.

On the substantive front, there will be considerable changes. Gone is the confusion arising from seven types of licence. They will be replaced by a new premises licence. Registered clubs will also require such a licence. Each set of premises must have an operating plan. This will include physical plans of the premises, details of the activities proposed, the licensee’s attitude to children in the premises, and the proposed opening hours. It is perhaps this section which has confused the media. Only the day before the publication of Nicholson, The Scotsman reported that the licensed trade was in “last gasp talks” with the Scottish Executive to attempt to stave off 24 hour opening. Had they read on they might have paused to consider the role of the licensing board. Each board will require to have a written policy on opening hours – many already do. As there will be no substantive change to the licensing board system or its membership, it is unlikely that there will be material changes to current practice. Those areas which favour liberal hours may well continue to do so, while those who favour early closing may opt for the status quo. A licensee’s operating plan will have to be approved by the local board, which may vary any part of which it disapproves. This will also be the case in connection with new licence applications. A board will be entitled to refuse these if they do not comply with the licensing principles, whether or not there is an objection. It is not entirely clear from the report, but the present onus in favour of a grant may disappear. There will also be a personal licence granted to a suitable, and suitably trained, person.

There are quite a few procedural changes. Licensing boards will sit as required. There will be a maximum of 15 members, but only five will be able to sit in public. Why? Nicholson’s experience is that at larger boards, members may experience difficulty in hearing what others are saying. In seeking to bring in a system fit for the 21st century, I would have thought that microphones were the answer. The applicant in a contentious case should be very unhappy indeed if his application is considered by only one third of those eligible.

This is an excellent report in many ways, but in some areas it ducks issues. Take, for example, the evil of binge drinking. This is widely attributed to irresponsible practices on the part of the licensed trade. Lest anyone doubt there is a problem, hasten to chapter 2.6. Deaths in Scotland due directly to excessive alcohol more than doubled between 1990 and 2000. There is little doubt that action is required. The relevant section, in Chapter 12, contains only three pages and two recommendations. It suggests that each operating plan should contain a standard condition stipulating that nothing should be done “whether by way of promotional advertising, by way of offering discounted prices, or in any other way, which encourages excessive consumption of alcohol,” prejudicing the licensing principles. Earlier in the chapter, however, it is stated: “We… have no fundamental objection to price discounting and price promotions, in principle”. In essence the committee is saying that a line is required, but someone else has to decide where to draw it.

Other controversial issues include the creation of a new post of liquor licensing standards officer. It is the expressed hope that these people (at least four per licensing area) will liaise and co-operate with licensees, while still being empowered to enter their premises and report them to the licensing board. This is the sole area of the committee’s work in respect of which there is any expressed dissent. The cost of these officials, as indeed the cost of the whole licensing administration process, is to be financed by the licensed trade. Taking my own local area, I cannot see how the cost could be less than £500 per licensed premises per annum. This proposed tax on one of Scotland’s most important sectors has not yet been grasped by the trade and must surely be unacceptable.

My major gripe is that Nicholson has not considered the planning implications of what it is recommending. The vast chasm between licensing and planning is one which causes untold problems to every licensing lawyer. While one could argue that it did not fall within the committee’s remit, it is an everyday problem in practice. Virtually every licensing application has some planning issue: now the planners will be able to treat every single case as one of a kind and demand new applications (and fees) for every variation. A bland recommendation that section 23 of the 1976 Act should remain unchanged is a blatant disregard of a serious practical problem.

There are too many other issues to discuss in detail, mostly items to applaud. These include requirements for training – for board members and licensees alike – and a faster system of appeal by way of stated case to the sheriff principal. Objectors will be treated more fairly, and the demons which separate sport and alcohol may be exorcised. Hoorah to all of these, but be warned that a perfect system is some little way off yet.

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