Tied pub tenants will get the right to a guest beer on their bar, chancellor John Healey has announced in his Budget statement today.
Among other measures announced, there will be an alcohol duty relief scheme for smaller brewers and cider makers,the tax threshold for small business rates relief for retail hospitality and leisure businesses will increase from £12,000 to £18,000, and the national minimum wage will rise, by 3.9%.
CAMRA chairman Ash Corbett-Collins spoke for many when he said: “We’re glad that the chancellor has targeted new measures at small pubs, independent brewers, and cider makers, even if the wider picture on beer tax, VAT, and energy costs will disappoint many drinkers, pub and beer businesses.”
“The announcement in the chancellor’s ‘Red Book’, that tied pub tenants in England and Wales will be allowed to serve a guest beer of their choice, is incredibly welcome. This could, if introduced properly, help independent brewers get more of their beers onto bars. We’re looking forward to working with the government to get the details right and deliver greater choice for drinkers.
“The government need to go further by making changes to make sure we can get decent beers from independent British and Irish brewers in all pubs instead of the same, bland beers from multinational brewing businesses that dominate at the bar.
“Drinkers will be disappointed to see a beer tax rise that will be passed on to pints in pubs in today’s Budget. The chancellor could and should have cut tax specifically on beer and cider served in pubs, and hiked duty on cheap supermarket alcohol to help level the playing field. At a time when many pubgoers, pubs, and brewers are struggling to make ends meet, increasing taxes on pints in pubs is the wrong decision.”
He added: “The £10 million alcohol duty relief scheme for smaller brewers and cider makers is great news for supporting the local and independent producers that pubgoers value so much. Small and independent brewers are making the highest quality, most innovative, cask beers that the UK has the offer, but they’re squeezed out of the market by the global drinks manufacturers that control bars and flood them with bland beers.
“Beer and pub businesses were crying out for a cut in VAT on food and alcohol, as well as action on sky-high energy bills and increased employer National Insurance contributions. The lack of action on all of these issues will only contribute to more otherwise viable pubs having to call last orders for good.”
Andy Slee, chief executive of SIBA, said: “Fans of indie beer will be toasting the chancellor’s big pledge for small breweries tonight as he delivers on expanding access to pubs and improves the generosity of small producer relief. This relief is used by small independent breweries to invest in their businesses, expand, and compete against the global brewers that dominate the sector, and today’s announcement will give them a vital boost.
“Thanks to the chancellor, pub-goers will have a better choice of beers at the bar, including those from local independent breweries. The right to a guest beer will permit landlords in large pub company pubs in England and Wales to sell what customers want, which is a great tasting local beer. Accessing the local pubs has been a barrier to growth for independent brewers who say they can’t sell to around 62% of the pubs in their local communities because of restrict market access. This is despite 80% of beer drinkers wanting to see local beers on the bar.”
He added: “Lastly, it is welcome to see positive changes to small producer relief as it applies to lower0strength beer. Small breweries were previously largely locked out of the growing market for lower-strength beers because of a quirk of the alcohol duty system. By improving small producer relief for them, too, it will enable brewers to respond to changing tastes and produce more lower strength beers that don’t compromise on flavour.”
Emma McClarkin, chief executive of the British Beer and Pub Association, said: “The confirmation of lower business rates for the next two years and an increase in the tax-free thresholds for smaller pubs and high street businesses is something we have worked with government on, so today’s announcement is a very welcome step in supporting pubs.
“However, when the entire brewing sector is united on calls to lower the cost of doing business, to have a rise in beer duty is troubling as it will undoubtedly push up the price of a pint. And, despite our calls to cut red tape, the introduction of yet more regulation for pub companies is disappointing.
“As the prime minister has acknowledged, there is much more to do to back our Great British pubs and pints and we support this ambition. Whilst many were hoping for more today, the expectation to deliver more remains. We will continue to work with government to transform the opportunities for brewers and publicans, create incentives to employ more young people, keep pints affordable, and ensure our locals remain at the heart of our communities.”
“Labour accounts for up to 45% of operating costs, so yet another rise in the national living wage lands hard on businesses that have spent two years absorbing higher costs with little left to give,” said Dan Maimone, head of global customer experience at employment specialist Harri.
“Operators support fair pay for all workers, but what worries them is the pace of increases with no matching support. When wage costs climb faster than revenue, venues cut hours and slow down hiring. That hits the workers that the rise is meant to help. The government needs to pair higher pay with practical support for the businesses that need it, or the sector will offer fewer shifts to the people who depend on them.”
He added: “Lifting the business rates threshold from £12,000 to £18,000 will help the smallest venues, and is welcomed warmly across the industry. But many of the operators I speak to sit well above that line and will see no benefit. Their bills are still rising, and they carry increasing wage costs on top.
“A higher threshold should only be the start. Hospitality needs a rates system that reflects what venues actually earn. Margins are thin enough that a single bill can decide whether a site stays open. Operators want predictability so they can plan to hire and invest, and until broader reform arrives, they will keep weighing every cost against survival.”
