As with the last edition, I’d like to keep this edition as upbeat as possible but, sadly, that remains difficult. I doubt whether I need to outline to readers the problems currently facing our pubs and breweries, not least from the extraordinary increases in energy costs (which, for businesses, are not subject to control). Both our pub and brewery sectors have faced many problems over the 51 years of CAMRA’s existence. We could now be facing the worst threat ever. The only positive note is that their plight is receiving the level of media coverage that it warrants.
CAMRA’s National Chairman, Nik Antona, made this plea to our new Prime Minister on 5 September, “I’d like to congratulate Liz Truss on her appointment as the country’s next Prime Minister. We look forward to working constructively with the new Government to protect and promote the nation’s pubs, social clubs, breweries and cider producers. CAMRA is urging the Prime Minister to take urgent action to introduce an energy price cap to help the UK’s world-famous pubs and breweries with the astronomical energy bills which threaten to destroy livelihoods and close scores of pubs for good. If pubs increased prices for consumers at the same rate as their energy bills, we would be paying £15 or £20 per pint at the bar, which obviously isn’t viable. Without help reaching them quickly, many businesses that survived the pandemic will be forced to close their doors for good with devastating consequences for communities up and down the country.”
CAMRA has identified four priorities here. These are:
- an energy bill price cap for hospitality businesses including brewers and cider makers;
- reforms to Alcohol Duty to be brought forward as quickly as possible and applied to containers of 20L and above;
- a VAT cut for both on-trade food and alcohol;
- proper reform of the business rates system to remove the current unfair burden on pubs.
CAMRA has called on its members to lobby their MPs, asking them to support these measures.
Let’s not forget that general inflation also takes its toll. Anything that needs to be transported will have increased in price and even replacement glassware is increasing in price because the producers are heavy users of electricity. In some ways this should come as no surprise because it became apparent during the pandemic that the energy supply industry has a negative attitude towards the hospitality sector with some companies showing a reluctance to supply pubs because of doubts about their financial security and often insisting on substantial deposits.
On 24 August, the Society of Independent Brewers (SIBA) wrote to the Chancellor of the Exchequer warning him that over 70% of Britain’s pubs could close over the winter. CAMRA were co-signatories to this letter. Even if this is only half right, it is still a disaster. This was followed up on 30 August by a statement from the chief executives of the six pub owning businesses who make up the board of the British Beer & Pub Association (BBPA). One of them, Chris Jowsey,the Chief Executive of Admiral Taverns, mentioned that one of his licensees had reluctantly given notice to leave his pub after a ‘truly terrifying’ 450% increase in electricity costs. He added a significant point, “Let’s not forget for most licensees, the pub is not just their business but also their family home.”
Brewers are not faring any better. Managing a production process that involves increasingly expensive raw materials and a high level of energy consumption is a challenge. No doubt the pub owning businesses are negotiating even tighter supply contracts. Some will not be buying in guest beers at all, just keeping to their main contracts with the big brewers.
As we go to print, all we know is that the Government will be offering business help for six months, to be reviewed after three. Details are awaited. Of course, when it comes to deciding priorities, hospitals and schools are similarly affected and will also be looking to the Government for extra funds. We should not underestimate the extent of the problem. Meanwhile, stories of pub and brewery closures keep coming.