Mr Schaefer's research conducted into the product was tested in cross-examination. In particular it was put to him that words chosen by the research groups to describe the product were all flavours developed for children, eg. "Barney Banana, Strawberry Big M, Paddle Pop and Vanilla Chubba Chub". Mr Schaefer disagreed stating these were merely "flavour profiles" and not associated with products from childhood.

Mr Schaefer was questioned on the comparative characteristics of "Moo Joose" and other products such as Bailey's Irish Cream and Kahlua and milk. In his opinion "Moo Joose" was only "marginally" lighter than Bailey's Irish Cream. I note he emphasised this was a personal opinion.

It was put to Mr Schaefer that the whole scheme of promotion and marketing revolved around milk - from the Friesian cow hide designs on the bottle to the name itself. Mr Schaefer conceded the words "Moo Juice" were commonly known as another way to refer to milk.

Mr Bob Aldred and Mr Alan Soares gave evidence to the Tribunal via video link up from Queensland. Their evidence focused on the causal issues of underage drinking and on the impact of marketing and appeal to teenagers of products such as "Moo Joose".

They recognised an increase in underage drinking in recent times particularly in the 12 to 15 year age group. Their report indicates that more current drinkers in this age group are drinking hazardous levels of alcohol. However they are of the view that it is a minority of underage drinkers who indulge in frequent episodes of binge drinking.

They referred to the Shanahan Report noting "The type of alcohol consumed during underage drinking binges relates to price (inexpensive forms); alcoholic volume (the higher the better) and peer preference (what is in [vogue])".

They expressed a view doubting there is any evidence that an additional milk based product will increase underage consumption.

They did however agree that if a drink such as "Moo Joose" became significantly popular in the 18 to 25 year age range (the target group) it well may become an added attraction for some underage drinkers.

1. Messrs Aldred and Soares put forward their view that "milk with its component proteins is likely to produce feelings of satiation that may limit the amount of "Moo Joose" consumed". It is unlikely in their opinion, that a person would want to keep up drink for drink with people drinking other alcoholic beverages.

The Tribunal notes that it was acknowledged by Messrs Aldred and Soares that at the time of writing their report it was their belief that full cream milk would be used in the product not skim milk.

In relation to harm minimisation, Messrs Aldred and Soares questioned whether this was best achieved by banning certain products or by the introduction of strategies to develop moderation. They emphasised education as a preferable way to try and achieve better drinking habits in the young. Harm minimisation in their opinion had to be addressed by more than regulating the product, it required influencing the individual and the society into safer ways of drinking.

They referred the Tribunal to a program in Quebec, Canada which they said demonstrated the benefits of co-operation between the alcoholic beverage and health industries in achieving better drinking habits and thereby reducing harm. The Tribunal was not persuaded the report had any credibility. It's claims regarding efficiency were untested. It did not demonstrate that it was based on any reliable record of public opinion or that the public opinion was a faithful reflection of actual behaviour.

In addressing the choice of alcoholic drinks by underage drinkers Messrs Aldred and Soares accepted that it was true that many underage drinkers preferred sweet drinks and that ready to drink mixed drinks (RTD's) had become popular because the mixer often disguises the bitter flavour of the alcohol.

Messrs Aldred and Soares commented on the reasons for the refusal of the Application by the Respondent. Addressing the words "unacceptable potential" they acknowledged that "Moo Joose" had the potential to appeal to underage drinkers, however they stated their view that "whilst some six or seven year olds may not realise the difference between alcoholic Moo Joose and other flavoured drinks that may be in the home refrigerator, it is reasonable to expect that the parents should teach these differences to their children".

In their Report Messrs Aldred and Soares make much of the addition by the application of the word "alcoholic" to the name and labelling of "Moo Joose", creating in their view a more clearly labelled alcoholic drink and in this way limiting potential for mistaking the product for a milk only drink.

46. The Decision of the Respondent to refuse the application I now set out in full -

"On 6 September 2002 the Director of Liquor Licensing determined to refuse application no. 35556 on the grounds that the grant of the application would be conducive to or encourage the misuse or abuse of alcohol as provided for by section 44(2)(b)(ii) of the Liquor Control Reform Act 1998.

• the grant of the application would result in the wholesaling, and subsequent retailing, of an alcoholic beverage with an unacceptable potential to promote the early uptake of alcohol by children;

• the grant of the application would result in the wholesaling, and subsequent retailing of an alcoholic beverage with an unacceptable risk of being inadvertently consumed by children and others in the mistaken belief that it was simply flavoured milk, and

• the wholesaling, and subsequent retailing, of flavoured alcoholic milk in 250ml bottles is inconsistent with the principles of the responsible service and supply of alcohol, particularly in that it seeks to leverage off the health values of milk to children and families.

The application by Wicked Holdings Pty Ltd for a pre-retail licence was to specifically provide for the wholesaling to existing licensees of "Moo Joose" - a flavoured skim milk beverage with the addition on 5.3% alcohol by volume.

Information supplied by the Applicant detailed that the beverage generally consisted of -

Proposed flavours are banana (Banana Smash), strawberry (Strawberry Rush), chocolate (Choc Fusion) and coffee (Wicked Irish) packaged in tapered 250ml frosted bottles with a cow skin motif in the colour appropriate to the flavour. Each 250ml bottle at 5.3% alcohol by volume will constitute 1.3 standard drinks, being the equivalent of -

• marginally less than a 375ml stubby or can of full strength beer (1.5 standard drinks)

• more than a 285ml pot of full strength beer (1 standard drink)

• marginally less than a 375ml spirit-based RTD (1.5 standard drinks).

Wicked Holdings Pty Ltd indicated that their intention was to leverage the "Moo Joose" marketing campaign off existing promotions by the dairy industry to increase milk consumption, e.g. "Go all night" etc.

The proposed "Moo Joose" marketing slogan is "Milk it for all it's worth!".

Discussion Paper for Investment in a Unique Australian Innovation".

This "Business Plan" type document details the proposed packaging, labelling, promotion and marketing plan for "Moo Joose".

In detailing the various perceived strengths and weaknesses of the proposed promotion and marketing of "Moo Joose", the document identifies as a "threat (external)":

'Local state and federal government intervention to limit marketing of alcoholic milk products i.e. issues with underage consumption'. P.11

However the document does not identify or address options to mitigate such perceived concerns.

'...research has clearly indicated a strong potential market among females in the 18-30 age group and males to a lesser extent'.

The level of underage drinking in Victoria is summarised in the "Victorian Alcohol Strategy: Stage One", being a report from the Minister for Health and the Department of Human Services issued in June 2002.

'Young people are consuming alcohol earlier in adolescence and are increasingly adopting high risk drinking patterns. The 2001 National Drug Strategy Household Survey demonstrates that almost a third of teenagers (28.3 per cent) aged 14-19 consume alcohol weekly. The first quarterly survey undertaken by the Premier's Drug Prevention Council (PDPC) showed that 90 per cent of Respondents aged 16-17 years had consumed alcohol during their lifetime, and 84 per cent had consumed alcohol in the last 12 months. Most young people saw themselves as social drinkers, with only 3 per cent identifying themselves as binge drinkers. Yet, 15% of young males and females were drinking at levels defined as hazardous by the National Health and Medical Research Council (NHMRC). Other alcohol related problems identified among adolescents in the report included creating public disturbance, verbal abuse and driving.

Issues raised through the National Alcohol Campaign developmental research identified the following community concern:

• Belief that under-age drinkers are becoming younger (i.e. under 15 years);

• A perceived increase in sexual abuse and unwanted sexual advances as a result of the harmful use of alcohol; and

• Increased self-inflicted harm, injury and risk behaviour.

Data from the 1999 School Students and Drug Use Survey showed that the prevalence and frequency of drinking alcohol increased steadily with age. Among Year seven students, 19 per cent had consumed alcohol in the week prior to the survey, compared to 62 per cent of Year 12 students. The proportion of students consuming 5 or more drinks in a row in the previous fortnight also increased with age, from 14 per cent of Year seven students to 57 per cent of Year 12 students'.

The National Alcohol Strategy endorsed by the Ministerial Council on Drug Strategy in July 2001 identifies:

• preventing alcohol-related harm in young people, and

• responsible marketing and provision of alcohol,

The availability of a flavoured alcoholic milk beverage in 250ml containers such as "Moo Joose" will, in the view of the Director of Liquor Licensing, exacerbate the existing incidence of, and community concerns regarding, underage drinking and the increasingly earlier age of alcohol uptake by children. The views of the Director were reinforced as a result of his meeting with Mr Munro Director, Centre of Youth Studies, Australian Drug Foundation held on 6 September 2002. At the meeting Mr Munro described Moo Joose as "the Australian Drug Foundation's worst nightmare" in terms of its potential to further encourage early take-up of alcohol by minors.

Whilst it may be contended by the Applicant that the grant of a pre-retail licence will only permit the wholesaling of "Moo Joose" to existing licensed retailers and that the subsequent retailing of the beverage must take place pursuant to the Liquor Control Reform Act 1998, and the conditions of the liquor licence held by the retailer, it is the expectation of the Director that sales will be predominately for off-premises consumption with actual consumption often occurring in private residence beyond the control regime of Victoria's liquor laws.

The 250ml bottle motif could be expected to be attractive to children and youth, with the storing of the beverage in domestic refrigerators presenting an unacceptable risk of inadvertent consumption by minors and others in the expectation that it is simply chilled flavoured milk.

The arguments put forward by the Applicant in support of the application point out that there are other combined dairy and alcohol products presently on sale in Victoria. They range from expensive combinations of chocolate, cream and brandy such as "Bailey's Irish Cream" and "Cadbury's Liqueur" to cheaper cream based liqueurs such as Shakers "Chocolate Mudslide" and "Banana Mudslide". There is also a product known as "Chicos" in a range of flavours such as Pina Colada.

These are cream based liqueurs that typically have a relatively high alcohol content of between 13.9% and 17%. They are packaged or presented as liqueurs to be consumed in small quantities or as part of cocktails.

The liqueur called Kahlua that is retailed in a ready to drink (RTD) format mixed with milk was pointed out by the Applicant as a parallel to the proposed "Moo Joose". Kahlua is a recognised liqueur that is often mixed with milk at the point of serving as one way of consuming the product. It is presented in a pre-mixed 200ml container for convenience.

It is the view of the Director of Liquor Licensing that "Moo Joose" is different from the existing dairy alcohol products.

The first group of existing products are cream-based liqueurs which enjoy long term community acceptance and are priced, packaged and promoted as a liqueur to be consumed in small quantities or to be incorporated in certain cocktails drinks.

There is a second group, including Kahlua, where a recognised liqueur, which may be consumed neat or in a variety of ways but which is sometimes served with milk. The producers/distributors offer a pre-mixed milk/Kahlua version for convenience.

"Moo Joose" has more in common with existing flavoured milks such as "Big M" and traditional milkshakes (but for the addition of alcohol) than with either of the existing alcoholic dairy product groups. It is packaged in small 250ml containers and appears to be intended as a refreshing beverage rather than a cocktail or liqueur. In effect flavoured milk is the primary ingredient to which alcohol has been added.

It can be contrasted with a drink comprising a brand-name liqueur to which cream or milk has been added.

The community attitude towards milk and the somewhat unique place milk has in the community also needs to be considered.

Milk is associated with youngsters and children and is regarded as a natural and healthy product and is generally free from any association with dangers of abuse or over consumption.

Victorian liquor law expressly prohibits the licensing of Milk Bars and it can be assumed that the legislators had good reason to enact a clear separation between alcohol and the serving of milkshakes and other milk drinks. Additionally, Section 4 of the Liquor Control Reform Act 1998 clearly states that the first object of the Act is to contribute to minimising harm arising from the misuse or abuse of alcohol by providing adequate controls over the supply and consumption of liquor.

The community is unlikely to find a product which is essentially a coloured and flavoured milk containing alcohol at the same level as full strength beer an acceptable addition to the range of beverages now available.

Having regard to the above, and for the reasons previously stated, the application in question was refused".

1. Mr Geoffrey Munro gave evidence that on 6 September 2002 at the request of the Director he gave his opinion regarding the application.

"(a) The Australian Drug Foundation's (ADF) aim is to reduce the harm caused by underage drinking and the introduction of alcoholic milk is the ADF's worst nightmare.

(b) The Australian Drug Foundation's (ADF) believes the sale of alcoholic milk (particularly if the product is to be named Moo Joose) will put a very palatable form of alcoholic drink, designed to attract young consumers, on the market. Its attraction as a "youth product" is likely to make it a drink to be sought by many underage people.

(c) There is therefore a strong risk that "Moo Joose" is likely to increase underage drinking.

(d) Consequently the ADF would recommend the refusal of a distribution licence for Moo Joose.

(e) The ADF would publicly oppose "Moo Joose" if it was distributed and went on sale in Victoria. The ADF would be prepared to lead a public campaign against the product".

49. At the hearing he expanded on this advice stating inter alia -

"In summary the ADF recommends a rejection of the application due to the risk that Moo Joose would increase the incidence of underage drinking as it may make alcohol accessible to adolescents and children who do not find existing alcoholic beverages attractive.

Underage drinking is a severe problem in Victoria. Young people are beginning to drink alcohol at an earlier age and are adopting high-risk consumption patterns of consumption (Ministerial Council on Drug Strategy, Alcohol in Australia: Issues and Strategies, 2001).

The most recent study of alcohol use by secondary school students in Australia in 1999 indicated the level of underage drinking has reached an historic high. Both the prevalence of underage drinking and the amount of alcohol consumed by under-aged drinkers were at record levels (White, 2002).

A survey conducted for the Salvation Army in 2002 found high proportions of binge drinking by underage drinkers (Roy Morgan Research, 2002):

A hazardous level of consumption places young people at risk of suffering acute harms as a result of intoxication due to alcohol. More regular consumption of hazardous amounts of alcohol places the drinker at risk of developing chronic diseases and complaints".

1. It was Mr Munro's evidence that alcohol related harm was both immediate and longer term with the potential for brain damage due to intoxication.

2. In particular and of significance to this application, Mr Munro highlighted the dangers posed by alcoholic milk:-

"Moo Joose will deliver alcohol in a form which adolescents and even younger children are likely to find attractive. Flavoured milk is already popular among children and adolescents. According to the Australian Dairy Corporation, 170 million litres of fresh flavoured milk are consumed in Australia per annum (personal communication, 2002). Typical flavours are chocolate, caramel, banana and strawberry.

Alcoholic milk is likely to be a palatable form of alcohol for adolescents and even children who find the existing RTDS unattractive. If fifteen year old teenagers prefer the sweet varieties of RTDS it is predictable that some children below fifteen years will find alcoholic milk attractive. As the taste of alcohol is obscured or disguised in RTDS via fruit juices, carbonated water and soft drinks, the presence of alcohol in Moo Joose will be disguised by the sugar, flavourings and colourings present in flavoured milk. If primary school children below twelve years now enjoy flavoured milk there is at least a strong risk that some of them will try Moo Joose.

The tainting of a healthy product: The name "Moo Joose" denotes milk as "Moo juice" is a colloquial Australian term for milk. Milk is a quintessential health product. It is often the first food given to children who generally know milk as a safe, healthy product. It is marketed to children, their parents and other carers as a safe source of calcium, important for the growth of bones and bodies, a product that promotes physical growth throughout childhood and protects against disease such as osteoporosis in later ages. Alcoholic milk, Moo Joose, will betray that trust. Alcohol is not a health food. There is no safe level of alcohol use for young people, as there is for adults".

1. Mr Munro referred to community concern regarding underage drinking. In particular he emphasised that many parents feel helpless to influence their teenagers' drinking behaviour.

"Limiting the distribution and sale of Moo Joose to premises which are licensed will not prevent its availability to minors. All alcohol beverages are sold in licensed premises yet underage drinking is increasing. It means minors have access to alcohol despite liquor licensing laws prohibiting sales to children. Most consumption of alcohol takes place off-premises such as in the family home. Moo Joose is likely to be taken into domestic settings where young people will gain access to it. In other cases Moo Joose may be given directly to young people by thoughtless or irresponsible others (e.g. siblings, parents)".

1. Mr Munro responded to the report of Messrs Aldred and Soares. He disagreed with their view that it was only a minority of underage drinkers who indulged in frequent episodes of binge drinking -

" They emphasise that the proportion of teenagers (aged 14-19 years) who drink at "risky or high risk" levels on a weekly basis is only "a minority" of 10.7%. It is actually 11.7% (Australian Institute of Health and Welfare, 2002).

Yet 10% is precisely the proportion of adult Australians who drink at levels "risky or high risk for short and longer term harm," a situation that has justified the development and implementation of an enduring national alcohol strategy (AIHW, 2000).

The "minority" of teenage hazardous drinkers is at risk of developing alcohol dependency.

The Australian Drug Foundation believes the figure of 10.7% is unacceptably high (as it is for adults) and everything possible should be done to reduce the appeal of alcohol to underage young people.

Despite their protestations the Messrs Aldred and Soares concede that the proportion of young people binge drinking, and the amounts they consume when they do so, is growing".

1. Referring to the evidence of Messrs Aldred and Soares that there was no evidence that alcoholic Moo Joose will increase underage drinking Mr Munro stated -

"Evidence of the effect of the beverage is not available for obvious reasons. Yet in the absence of that evidence the authors are happy to assert "It is reasonable to conclude that, at most, it will change the product used without influencing overall consumption levels". The Australian Drug Foundation believes, on the basis of current trends in alcohol use among underage young people, that the distribution of Alcoholic Moo Joose will pose an unnecessary risk to the health and wellbeing of vulnerable children. The ADF would prefer Victoria did not conduct the experiment".

1. Mr Munro raised concerns that the low fat content of milk in alcoholic Moo Joose will prove attractive to young women aged 18 and over who are weight conscious. He said -

"Many girls aged less than 18 are conscious of their body image and presumably they will be attracted to alcoholic milk for the same reason. The authors' Messrs Aldred and Soares appear to be in agreement".

1. Messrs Aldred and Soares alluded to increasing problems of spiked drinks and stated a view that "for this reasons many young women are happy to dispense with a glass and to drink from a small bottle as men and women do from a stubbie. Moo Joose has the advantage of size, narrow neck and having a screw top. Women can easily handle the screw top themselves and they can see that the sealed top has not been broken".

2. Mr Munro comments "there is no reason to distribute alcoholic milk just because it is sold in bottles with a narrow neck". He further states -

"If that is a particularly useful way to prevent drink spiking it might be a rationale for requiring all alcoholic drinks to be sold in that form. However, we are not aware of any research to that end, neither do we believe the industry is likely to adopt that step".

1. It is suggested by Messrs Aldred and Soares that packaging the Moo Joose in a four pack "is also a harm minimization strategy". On the contrary, Mr Munro argues -

"Many alcoholic brands, especially ready-to-drink beverages, are now sold in packs of four rather than "six-packs". It is a marketing strategy designed to lower the threshold price to make the product more accessible".

1. In relation to the evidence concerning the name change of the product to alcoholic Moo Joose Mr Munro submits the Australian Drug Foundation's concerns are not alleviated by this. He says -

"Moo Joose is a colloquial term for milk and the new name communicates the product is an alcoholic milk drink. Milk is known by children and young people as a healthy product and .... Alcoholic Moo Joose will deliver alcohol in a form that adolescents and younger children are likely to find palatable and attractive".

1. Referring to other alcoholic drinks in the market place in particular vodka mudshakes, Mr Munro indicated that the Australian Drug Foundation would have objected to the entry of that product into the market but there was no such opportunity. He said objections would have been based on the grounds that -

62. He however points out that the name vodka mudshake is -

"Less objectionable as it designates the nature of the product as an alcoholic drink and does not seek to promote itself as milk".

1. In relation to other strategies, solutions and initiatives, education takes prominence in the view of Messrs Aldred and Soares. Mr Munro states -

"Educating the public about alcohol is one public health strategy. People who use alcohol need to understand its effects and how they can reduce the risk of suffering or causing harm when they drink alcohol. That is the first priority of the Australian Drug Foundation, and many other organisations contribute to that goal in various ways and to varying capacities. Different strategies are required in different situations and in response to particular problems. Education is one strategy, so is restricting access to alcohol or reducing availability, to particular groups, at particular times, in particular places, and in particular circumstances.

It is not incumbent upon health promotion organisations to agree with every demand of the alcohol industry, or to applaud the introduction of every new product or marketing plan or gimmick".

1. In relation to responsible promotion Mr Munro took issue with the contention of Messrs Aldred and Soares that alcohol should be promoted in terms of product taste and quality and their assertion that the alcohol industry is in agreement. He contented if that were true, we could expect alcohol advertising to follow suit. Instead he stated alcohol advertising usually emphasises alleged lifestyle benefits of drinking especially relaxation, popularity, excitement, sexual attractiveness and relationships.

2. The Tribunal was referred to a report of Dr Ann Roche (Professor and Director of the National Centre for Education and Training on Addiction at Flinders University) presented to VCAT in the case of Anthony Avery -v- Director of Liquor Licensing Victoria and Anor (VCAT 20 April 2001). Dr Roche's report dated February 2001 states "harm minimization" is a concept which has been central to the National Drug Strategic Plan (1993 - 1997) which guided the development and implementation of alcohol and drug policies across Australia through the 1990's. The concept was defined as an approach that aims to reduce the adverse health, social and economic consequences of alcohol and other drugs by minimizing or limiting the harms and hazards of drug use for both the community and the individual without necessarily eliminating use. Dr Roche said the approach includes preventing harm and reducing actual harm.

Having considered all the evidence in this application the Tribunal finds that the grant of the application would create an unnecessary risk to the health and well being of underage children. The Tribunal in so doing recognises that education is very important in encouraging desirable drinking habits in all consumers of alcoholic beverages and plays an important role in minimising harm .

The Tribunal notes and has taken into account the evidence that prohibition of a particular product may result in a contribution to the desirability of that product. The Tribunal distinguises between prohibition and regulation. The Tribunal finds that regulation can contribute to reducing the potential for harm in particular circumstances and finds the facts in this application to be such as to demand such regulation.

In reaching this conclusion the Tribunal takes into account the particular evidence of Mr Munro in relation to the dangers of alcoholic milk. The Tribunal agrees that milk is a first food given to children and becomes generally known as a safe and healthy product. It is marketed to children, their parents and carers as a safe source of calcium. It is a product that promotes physical growth throughout childhood. Further it is marketed as a protection in later years against such diseases as osteoporosis . The Tribunal finds these characteristics are well established.

The Tribunal rejects Mr Schaefer's assertion that "the fact that the market understands the benefits of milk is totally divorced from the product". The Tribunal finds the promotional material seeks to take advantage of the healthy aspects of milk.

Whilst the Tribunal acknowledges that other milk based alcoholic drinks are currently available on the market it distinguishes this proposed product in a number of ways.

The product is in fact based on a reconstituted skim milk powder. The Tribunal accepts the evidence that it is watery in consistency unlike existing alcoholic milk products. It differs from other products such as Bailey's Irish Cream which can be described as a cream based liqueur which has established community acceptance and is priced, packaged and promoted as a liqueur which by its nature is to be consumed in small quantities or incorporated in cocktail mixes. Drinks such as Kahlua are distinguishable as they have a recognised alcoholic flavour. Whilst Kahlua may be consumed neat or with milk it does not seek to promote itself as milk.

The Tribunal notes that changes to the name and labelling have been made following suggestions to the Applicant by Messrs Aldred and Soares. The Tribunal finds this is not sufficient to make the product acceptable.

The Tribunal rejects Mr Schaefer's assertion that "the fact that the market understands the benefits of milk is totally divorced from the product". The Tribunal finds the promotional material seeks to take advantage of the healthy aspects of milk.

The Tribunal finds the proposed marketing and promotion of the product to be irresponsible and would in its view, attract the attention of underage drinkers.

The Tribunal takes into account the evidence referred to in relation to Dr Roche's professional suggestions in regard to approaching harm minimization. In particular her view that this should include "preventing harm and reducing actual harm".

The Tribunal refers to the objects of the Act (set out above). They provide that the purpose of the Act is to contribute to minimising harm. The Tribunal finds that regulation is one way to achieve this. The Act provides for controls over the supply and consumption of liquor and the Tribunal finds the facts before it in this application to be such as ought to attract those controls.

The Tribunal finds that the proposed product which is essentially a coloured and flavoured skim milk with the addition of ethol alcohol -at the same level as full strength beer- to be an unacceptable product. The Tribunal finds that to grant a pre-retail licence for this product would be conducive to or would encourage the misuse or abuse of alcohol within the meaning of Section 44(2)(b)(ii) of the Act. For these reasons the application for review is dismissed and the decision of the Director of Liquor Licensing is affirmed.