Pubs are among the businesses being hit hardest by energy costs, according to the latest Business Insights and Conditions Survey from the Office for National Statistics.
“It’s deeply concerning, but unfortunately no surprise that the ONS reports energy prices as the main concern for three out of five hospitality businesses in November,” said CAMRA chair Nik Antona, “even with the government’s Energy Bills Support Scheme in place.
“The steps that these vital community hubs will be forced to take, such as cutting trading days or hours, offering a more limited selection of products, increasing prices, or even taking the difficult decision to let some staff go, are all sure signs that the Government needs to act now. That means using the Autumn Statement to cancel inflationary duty raises and announce support on energy bills and business rates beyond April next year.”
He added: “Over 8,000 CAMRA members have already called for the chancellor to use Thursday’s statement to safeguard the future of pubs, clubs, brewers, and cider makers, and I urge everyone to add their voice by visiting camra.org.uk/budget2022/ to contact their MP about this important issue.”
The Campaign for Pubs has also written to Jeremy Hunt, calling on him to introduce a package of meaningful and targeted support for pubs and small brewers.
In its letter, the campaign calls for:
- VAT of 5% on all hospitality/on-trade sales for 12 months to benefit all pubs, not just those that sell food or provide overnight accommodation, but also the vital, smaller, wet-led community-orientated pubs that already missed out on so much of the support extended to the rest of hospitality during the Covid crisis.
- Reduce the flat rate for VAT. This was reduced at the same time as the rate on food, but it has returned to the normal rate now. It is essential that it is now reduced again.
- Extension of zero business rates for the next fiscal year and a revision for 2023/24 to increase the multiplier for hospitality to reduce rates, along with an increase in the zero-rated threshold to £20,000, also for rural rate relief. (In the longer term, it is still crucial that there is a complete overhaul of the unfair and unique way in which business rates for pubs are calculated.)
- Extend business rates relief to small brewers and producers (and other pub suppliers, whose businesses are seriously threatened by the cost-of-living crisis).
- Further and more meaningful action on energy bills for businesses (funded by a windfall tax on energy companies). The threat from unaffordable energy bills is also existential, not just for pubs but also for small independent suppliers and producers, including many of the UK’ small breweries and other drinks firms, all of whom rely on significant energy usage.
The full letter can be downloaded here.
Emma McClarkin, chief executive of the British Beer and Pub Association, said: “These new figures highlight the extreme pressure that extortionate energy costs continue to have on our pubs and brewers, and the tough decisions they are being forced to make to keep serving their communities.
“Many have already taken drastic measures, reducing trading hours or even days on which they open, and we’re not even into the coldest months yet. These rising costs are compounded by inflation on key ingredients, severe staffing shortages, and a cost-of-living crisis that is leading customers to see a pint in their local as an unaffordable luxury.”
She added: “This Thursday, we desperately need the chancellor to provide relief to the cost of doing business, but we also need clarity and certainty for our pubs and brewers that energy support will continue beyond the initial six months.
“The figures published today demonstrate clearly how vulnerable our industry is, with 50 pubs a month currently closing their doors for good. Without some long-term guarantee, many more will not be able to survive what is set to be a very difficult winter.”
