As business costs continue to soar and the cost of living bites for consumers, the British Beer and Pub Association has made a final plea in an open letter to the Chancellor, asking him to reconsider a freeze to beer duty to help keep the cost of a pint in the local pub affordable for customers this Christmas.
Highlighting new figures the letter shows the average costs for pubs and brewers were up 22% at the end of this summer compared to 2021, even before colder months started to bite.
Writing to the Chancellor, the Association stresses that soaring prices are forcing businesses to pass on costs to their customers at the bar, with the average price of a pint up 8% on last year.
The letter, sent by the BBPA, representing businesses from regional pub companies to international brewers, highlights the tax as one of a myriad of costs that are driving increased prices for customers and crippling their businesses; with over 50 pubs a month now closing compared to around 30 just 12 months ago.
Highlighting soaring costs across the entire supply chain and ongoing uncertainty about whether they will receive support with unmanageable energy costs beyond March, the letter notes the freeze would help to keep the price of a pint affordable and ensure customers aren’t deterred from a trip to their local this festive period, with UK beer sales already down 10% on the same period last year.
The letter also cautions that failing to introduce the beer duty freeze would take the tax to its highest ever historical record at a time of severe pressure for the industry, but reinstating would channel £360million back to pubs and breweries.
Emma McClarkin, Chief Executive of the British Beer and Pub Association said:
“We are caught in an extremely vicious circle, customers are understandably being cautious, but the cost of doing business is out of control and as a result this is set to be the toughest Christmas on memory for UK pubs and brewers. Many just managed to pull through the pandemic, but what we are facing now is crippling businesses at an unprecedented rate. We need the beer duty freeze reinstated to alleviate at least some of the cost pressure on our pubs and brewers and to avoid undermining the crucial Alcohol Duty reform measures to be implemented in 2023.
“The last thing these pubs want to do is put prices up for customers who are struggling themselves with the cost of living, they want to provide a warm and welcoming space for their communities, especially in this acutely difficult time, but without relief from the Government it’s difficult to see how many will continue to do so.”
Oliver Robinson, Joint Managing Director of Robinsons Brewery, who operate 260 pubs across the North West and North Wales said:
“For months there has been absolutely no let-up in the costs being piled onto our business. We are seeing unprecedented price increases across the business but especially on raw materials and if these were all passed on it would make the cost of a pint almost unaffordable in many pubs.
“News of the beer duty freeze by the former Chancellor provided a ray of hope, but the subsequent U-turn has not helped the mood and we urgently need the Chancellor to reinstate it to provide some let up. Beyond this, there needs to be some parity created, we need a VAT reduction within our sector to make sure it can be allowed to thrive once again, not just survive. We want to be in a position where we are supporting and funding government in a fair way, not one that is unsustainable.”
Paul Davies Chief Executive of Carlsberg Marstons Brewing Company said:
“Costs are spiralling across the whole of our supply chain, from the cost of CO2 to malt to bottles, all directly impacted by energy. A cut to beer duty would ease these pressures so we can continue to supply the industry at this difficult time and help keep the cost of a pint affordable for customers.
“If the Government is serious about investing in businesses for growth they need to recognise the value our industry brings not only socially in communities across the UK but economically and deliver a freeze to a tax that is in desperate need of reform.”