Since the last edition we have moved from Plan B, back to Plan A, and now out of Covid restrictions altogether. Hopefully, this, especially the end of mandatory ‘working from home’, will see trade returning to pubs in the City and West End (see Christine Cryne’s report on page 20). That said, we should not be complacent. The curse that is Covid has not gone away and many people are still inclined towards caution.
The consequences of Covid are now being exacerbated by wider problems. In February, UKHospitality (UKH) were predicting price increases of 11% across the hospitality sector. In parts of London (and not just centrally), a pint can now cost £5 or £6. We can all understand what is driving these price increases, not least fuel prices, which have both direct and indirect effects. Some energy suppliers are even refusing to supply pubs and restaurants because they see them as too much of a risk. There have also been increases in employment costs, wholesale food and drink prices, and insurance costs.
Furthermore, as from 1 April, the VAT rate returns to 20%. This will also add to the cost of a pint but, of course, here there’s no benefit to the pub. It goes straight to the Government. The industry has asked the Chancellor of the Exchequer to keep the 12.5% rate for now. His response will have been in his Spring Statement, due shortly after we went to print.
We drinkers, of course, are affected by many of the same problems and our ‘discretionary spend’ is being reduced. However justified the increases might be, pub operators have to accept the risk that many potential customers will be priced out. It is in their own best interests to keep prices competitive (and by that I don’t mean cheap). I accept that it is not easy but it needs to be done.
Finally, and not surprisingly, the pub and beer trade have been to the forefront of fundraising efforts for the people of Ukraine. Shepherd Neame, for example, donated £20,000 to the British Red Cross’s DEC Ukraine Humanitarian Appeal, and is promoting a Just Giving campaign across its pub estate. One pub raised £600 through a cupcake sale. Charity fundraising is a side of the hospitality trade, especially with community pubs, that those in power seem to have little regard for. I, for one, say ‘well done’.
Tony Hedger