Despite huge amounts of campaigning, huge numbers of pubs still face an uncertain future after today’s Budget statement by the chancellor.
He did announce that the alcohol duty freeze will be extended until February 2025. The government says this will save consumers 2p on a pint of beer, 1p on a pint of cider, 10p on a bottle of wine, and 33p on a bottle of spirit, compared to if the planned rise had gone ahead. Jeremy Hunt said this will benefit 38,000 pubs across the UK, while reducing inflation this year. But business rates remain set to rise, and many venues are still paying high energy bills.
“The spring Budget statement this afternoon delivered no support for independent pub businesses in every village, town, and high street across the UK,” said Steve Alton, chief executive of the British Institute of Innkeeping (BII).
“The freeze on duty until February next year will not help pubs, who have been facing huge inflation in every area of their business, high energy costs, wage rises, and reduced footfall from consumers facing their own cost of living crisis.
“Our members and the wider hospitality industry are in urgent need of meaningful investment to allow them to thrive as essential hubs of their communities, delivering vital social connection, all whilst supporting local employment and local supply chains.
“This Budget simply did not deliver to safeguard incredibly successful operators, who are struggling with profitability, whilst being unfairly and disproportionately taxed.”
Dawn Hopkins, vice-chair of the Campaign for Pubs, said: “The chancellor has now confirmed what UK publicans already suspected, that this government doesn’t actually give a damn about pubs and is happy to see them continue to close. There was absolutely nothing for pubs at all in this dreadful budget, which is disastrous considering the situation publicans are facing with the cost-of-living crisis.
“Absurdly, the Chancellor stated that he was ‘backing the Great British pub’, yet his Budget showed no such thing. We were fobbed off once again with the myth that a beer duty freeze will help pubs, when it makes no difference to publicans or pub customers, yet funnels millions to the big brewers and alcohol producers, that do not need any support. It’s clear who’s side the Chancellor is really on.”
Phil Saltonstall, brewer representative at the Campaign for Pubs, added: “The chancellor has yet again peddled the lie that a duty freeze will ‘benefit 38,000 pubs’. It will hardly be noticed by pubs, but it will give millions of pounds worth of tax cuts to the six multinational brewers and their city pubco stooges who control most of the UK’s pub estate.
“This comes a day after our own MP in Malton, and business minister, Kevin Hollinrake, handed out the All Party Parliamentary Beer Group Community Pub Hero Awards, including presenting the Scotland Pub Hero award to my brother’s pub in Leith, for the fantastic community work that he, his partner, and their pub community does. Yet despite the smiles and warm words, which are all too easy, the government has shown today it doesn’t actually care about pubs or the people who actually run them.
CAMRA chairman Nik Antona said: “The Budget was a missed opportunity to show ‘backing for the Great British pub’ by significantly cutting tax on draught beer and cider served in pubs.
“However, freezing alcohol duty until February 2024 will be welcomed by consumers and breweries, helping mitigate an additional hike in costs to be passed on to pubs and pub-goers.
“Making duty on draught beer and cider significantly lower would promote drinking in the regulated setting of a community local and help small and independent producers who sell mainly into pubs and taprooms to compete against the global brewing giants and the likes of supermarket alcohol. CAMRA will continue to campaign for the Treasury and all political parties to back our sensible ask of making tax on pints in pubs 20% lower than the general duty rate.”
He added: “The chancellor’s announcement that the VAT registration threshold for small businesses will be increased will not benefit the majority of pubs, breweries, or cider producers. Cutting VAT on all sales in the hospitality sector would have been a simple way to support consumers and beer and pub businesses in all parts of the UK, helping to keep the nation’s pubs, social clubs and breweries alive and thriving at the heart of communities and local economies.
“The chancellor should still consider cutting VAT for these businesses to ease the significant financial burdens on the sector and help to reduce the rate of pub and brewery closures which deprive consumers of community pubs and choice of local beers.”
Andy Slee, chief executive of SIBA, said: “The government’s continued support for independent breweries and community pubs through an extended beer duty freeze is a welcome announcement that will help keep the price of a pint from rising. The national insurance cuts will also put more money into people’s pockets, which is essential for encouraging spending in pubs and hospitality.
“However, nothing has been done to address the heavy Covid debt the sector still carries, and despite pubs and independent breweries being vital to local communities, they have received no direct support in the spring Budget — with a missed opportunity to increase the draught relief to 20% or more, which could have boosted our hospitality sector.
“Between them, SIBA members run over 2,000 pubs, bars, and brewery taprooms, making a significant contribution to the local economy and community wellbeing. We are disappointed that nothing specific has been done to help alleviate the cost tsunami facing our much-loved breweries and pubs in the months ahead.”
Emma McClarkin, chief executive of the British Beer and Pub Association (BBPA), said: “It is good news that the chancellor was able to extend the freeze to beer duty at this Budget and will be welcomed by brewers, pubs, and consumers alike, and will go some way to keep the price of a pint affordable.
“However, this April brewers and pubs still face a £45m cliff edge of spiralling wage costs and business rates increases, particularly those pubs that are larger or food led. It is disappointing that the chancellor did not choose to go further with a duty cut, reduce VAT, or cap the increase to the business rates multiplier which would have helped mitigate the huge cost of doing business.
“Pressures on our sector remain acute, with margins being squeezed to the point where we fear it is likely that a further 500 to 600 pubs are likely to close this year, on top of the 530 that closed in 2023.
“No government should turn a blind eye to the erosion of such an integral economic, social, and cultural asset, and it is vital that, at the election, the political parties commit to putting in place a fiscal and policy framework that will see our sector thrive for the long term and not continue to deteriorate.”
“We very much hope that the decision to cut national insurance contributions for all workers by 2p in the pound will boost consumer spending power and encourage people to enjoy an extra pint in their local. But I urge the government to look again at the urgent measures needed to make the cost to doing business more affordable at the next fiscal event, and through policy commitments made in the run-up to the election to truly back the British pub.”
Kevin Georgel, chief executive of St Austell Brewery, said: “As a brewery, we welcome the chancellor’s decision to extend the freeze to beer duty in today’s budget, but this will not see costs cut for our sector.
“The UK still has one of the highest levels of beer duty in Europe — 12 times higher than Germany. We would therefore like to see the government set out a roadmap to bring current duty down to the European average.
“Great British pubs are at the heart of their communities, but they remain over-taxed and under increasing pressure due to the impact of inflation, the cost of living, reduced footfall, and high operating costs. This was not addressed in today’s budget.
“We therefore urgently need the long-term reformation of business rates, a VAT cut, and more meaningful government support to reduce the tax burdens on our sector — one of the UK’s leading employers and social and economic contributors.”
Rupert Thompson, managing director of Hogs Back Brewery, said: “The extension of the alcohol duty freeze to February 2025 is very welcome. A pint of beer in the local should be an affordable treat, not an expensive luxury.
“We’re pleased that the chancellor acknowledged the enormous value of pubs to British society in his speech. Pubs provide the only route to market for draught beer, particularly cask ale. It’s something that they can uniquely offer to their customers, so are vital to us as a brewer.
“Without thriving pubs, cask’s future looks very bleak, which would be a tragedy for this uniquely British beer, the many drinkers who enjoy a pint of it in their local, and the thousands of people employed by local breweries.”
