At the beginning of the current set of financial problems, I think that most of us were more concerned for the future of our pubs than breweries but, sadly, we have recently seen an upturn in brewery closures. There was a long wait to hear from the Government as regards its plans for the when the Energy Bill Relief Scheme expires on 1 April and, in the uncertainty, some breweries decided to call it a day and close on their own terms rather than actually fail. You have to respect that, although people lost their jobs all the same. More information as to closures can be found in the Brewery News column. Pubs, obviously, remain under threat as before.
It has to be acknowledged that the scheme was costing a lot of money (£20 billion in the six months to April) and, given that public services also need additional funds, the decision as to where the money goes is highly political. Eventually, on 9 January, it was announced that that hospitality businesses will continue to receive support with their energy bills for a further twelve months from 1 April but at a lower rate under what will be called the Energy Bill Discount Scheme.
Responding, CAMRA’s national chairman, Nik Antona, commented, “The prospect of energy bills soaring in April as other costs keep rising and consumers tighten their belts will leave the nation’s pubs, social clubs, brewers and cider producers apprehensive about how they can continue to make ends meet. While we want to see energy support reinstated at current levels, it is now vital that the Chancellor uses his budget in March to announce a wider support package if our pubs are to survive and thrive. This must include proper reforms to fix the unfair burden of business rates and introducing the new lower rate of duty charged on draught beer and cider at 20% below the general duty rate. This would help keep pub-going affordable for customers and give our locals a fighting chance against the likes of cheaper supermarket alcohol.”
At least, under the new scheme, the production of beer, malt and cider is recognised as energy intensive, thus qualifying for a higher rate of assistance. Also, before Christmas, the Treasury did announce a freeze on alcohol duty for six months but this, too, is only a temporary measure and does not help with long term planning. Looking forward to the budget (15 March), a reduction in VAT for on-sales in the hospitality trade would help. The Government might also like to consider the abolition of the beer tie as it applies to pub owning companies who do not brew. This would enable pub tenants to buy their beer at market rates. Both of these measures have been open to the Government at their discretion since we left the European Union.
Some community minded pubs and social clubs are acting as ‘warm hubs’, during the crisis but they do not qualify for extra support despite being vital community facilities. Hopefully this can be revisited before March. On the other hand, one report that I saw suggested that a number of pubs (it said ‘thousands’) would be reducing their opening hours to save on energy costs. Some, particularly rural ones, might close completely until the spring. I would make this request. If pubs and taprooms do decide to restrict their opening hours then, while we understand why, please could you put notices giving your revised times on the outside of your premises and make sure your website is updated. It is only fair to the drinkers who want to help you.