Sales of British beer rose by 0.7% in 2017, with a positive end to the year supported with a freeze in beer duty in the November Budget. This increase in sales means that 55 million more pints of beer were sold in 2017, compared with the previous year.
While there has been an increase in overall beer sales, sales in pubs and bars still fell by 2.4%, the biggest drop since 2013. This equates to nearly 88m fewer pints sold in pubs than the previous year. This is due to a combination of factors including a 3.9% duty increase in March, higher operating costs for pubs, including business rates increases and sharply rising employment costs, as well as fragile consumer confidence.
Beer sales have been largely stable over the past three years after several years of sharp decline. This trend has been greatly helped by three one-penny cuts in beer duty from 2013 to 2015, and a duty freeze in 2016.
Prior to 2013, there was a slump of 14% in sales under the controversial beer duty escalator, when a tax hike of 42% from 2008 to 13 was accompanied by 58,000 job losses and 7,000 pub closures.
Brigid Simmonds, chief executive of the British Beer and Pub Association, said: “Whilst it is encouraging to see beer sales rise slightly in 2017, it is still hugely concerning to see on-trade sales fall for the seventeenth year in a row.
“This shows just how important the decision to freeze beer duty in the Autumn Budget was, particularly after an inflation-busting 3.9% rise in the Spring Budget. Cutting beer duty is hugely important to community pubs where on average seventy percent of alcohol sold is beer.
“The Autumn Budget helped safeguard jobs, pubs and investment in a very British manufacturing industry, and it is essential that the Government continues to support beer and pubs throughout 2018. Further support on duty and tackling the disproportionate rates bill paid by pubs remain top priorities for us.”
SIBA chief executive, Mike Benner, noted: “The 0.7% increase in overall beer sales is good news for the craft beer sector. Bottles and cans continue to be strong, and these figures are a timely reminder to our members who are considering canning and bottling.
“But the continued on-trade decrease in sales is difficult news for craft brewers who rely on cask ales as their primary product. The headline rate of beer duty and business rates on pubs remain two critical issues for the on-trade which SIBA will be campaigning hard on over the course of 2018.
“Recognising the contribution the Treasury made back in November to help the sector keep ticking over, SIBA commissioned a one-off beer to toast the Chancellor, HM Treasury and MPs who campaigned for a beer duty freeze.”