LATE-NIGHT drinking laws are predicted to fuel an estimated £500m increase in sales of beer, wine and spirits, undermining government promises to end Britain’s binge culture.

A report by Goldman Sachs, the investment bank, on one of the major pub chains claims sales in each pub could increase by 10% in the coming year.

A similar increase in trade for other chains will help push UK consumption of alcohol to its highest level ever. Britons already drink 11 litres of pure alcohol a head each year, the equivalent of 28 bottles of vodka.

The report, circulated to potential investors, is an embarrassment for the government, which insisted that the new drinking laws — due to come into force on Thursday — would bring a cafe-style culture to Britain and a more leisurely consumption of drinks. Instead, the report predicts a “boon” for the industry with the introduction of late-night drinking.

Andrew McNeil, of the Institute of Alcohol Studies, said: “Despite what the government has said, these new laws are about selling more alcohol and larger profits for the drinks industry. It will mean more alcohol-related problems.”

The Goldman Sachs report on Mitchells & Butlers, which operates about 2,000 pubs, said the company was likely to be a “major beneficiary” of the new laws. It stated: “Our calculations suggest the potential [operating profit] upside could be as high as £33m.”

The bank’s assessments, compiled in 2004, predict the extra sales for pubs that apply for opening time extensions allowing them an extra five hours a week.

Goldman Sachs estimated that the turnover of each pub could increase by as much as 10%, but these evaluations are likely to understate the possible growth. Some of the biggest groups have applied for an extension of at least seven hours a week for most of their pubs.

The seven pub chains that each operate at least 1,000 pubs — including Enterprise Inns, Punch Taverns and Greene King — have a combined turnover of more than £5 billion. A 10% increase in revenue would therefore mean extra sales of more than £500m.

Lobby groups say the report confirms the warnings of academics that the new laws are likely further to entrench a British binge-drinking culture.

Dick Hobbs, professor of sociology at the London School of Economics, said the government’s hopes that the drinking laws would moderate drinking habits was always unrealistic.

“We’re not going to suddenly behave like villagers in Tuscany and go out at 11pm at night and have a couple of drinks,” he said. “What is being introduced is flexibility in order to maximise profits. In that respect I think it’s going to be a massive success.”

The groups behind two key reports used by the government to justify the new laws had received funding from the drinks industry.

A Home Office white paper that outlined the reforms drew heavily on a 1992 report entitled Drinking and Public Disorder, which said more flexible drinking hours would lead to “significant reductions” in drink-related offences.

The report was funded by the Portman Group, which was set up by the drinks industry to encourage responsible drinking.

A second report was produced by the all-party parliamentary beer group of peers and MPs, which receives more than £35,000 a year from the drinks industry.

A spokesman for the British Beer and Pub Association said the impact of the new laws could not be predicted. Most companies, however, expect a boost to their revenue.

A spokesman for the Department for Culture, Media and Sport said the government had consulted widely on the reform, adding that the new laws meant local authorities would have greater powers to deal with problem premises.

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