CHANGE OF MIND – ALMOST
Readers may remember that, during the pandemic, one of the Government’s temporary measures to help the pub industry was to allow all pubs, including brewery taps, to sell take-away alcoholic drinks irrespective of whether they held an off-licence. This was an amendment to the Licensing Act 2003 provided for in the Business and Planning Act 2020. In August the Government announced that the concession would end on 30 September. The Home Office said that they had consulted on the matter and ‘the majority of respondents wanted a return to the pre-Covid rules’. It isn’t clear quite whom they consulted. Happily, following an adverse reaction from the trade, they withdrew this decision and so the concession continues in force until the next time they decide to review it.
Sadly, the gesture has been somewhat negated by the Government refusing to change a flawed aspect of the new alcohol duty rules which came into effect on 1 August. Readers will recall that there is a new reduced duty rate for beer and cider which is sold on draught in pubs. The rules specify however that beer and cider sold at this rate must not be repackaged and this includes selling it in containers provided by either the pub or the customer. Draught beer and cider can therefore only be sold as a take-away if it comes from a separate supply purchased for this purpose and on which duty has been paid at the full rate. Most pubs are unlikely to find that worthwhile. Products in bottles and cans are not affected.
Another pandemic provision, to allow tables to be put out on public pavements, has been reapproved until 30 September 2024.
W(H)ITHER WORTHY WHITE SHIELD?
Very worrying news. Molson Coors, who inherited the brand when they acquired Bass, say that production of this iconic bottle conditioned beer has been ‘rested’ and that it will be ‘out of stock for the foreseeable future’. The 5.6% ABV pale ale, brewed with pale and crystal malts and Challenger, Fuggles and Goldings hops, was introduced by William Worthington in 1829 (Bass and Worthington merged in 1926). Being an unusual product, it has had a somewhat nomadic life over the last fifty years, most recently being brewed at the Heritage Brewery at the National Brewery Centre. The NBC has, of course, now closed and this is presumably what has led to the current situation. Molson Coors are reported to be unwilling to sell this part of our brewing heritage yet they won’t brew it. Sad. There is a beer called Worthington’s (3.7 ABV) available on draught (mostly keg) but it is far from being the same beer.
A WINTER OF DISCONTENT?
According to the British Beer & Pub Association (BBPA), the pubcos’ trade body, 15% of pubs have told them that they are at risk of failure in the next twelve months and 95% of those pubs have highlighted energy costs as the most significant problem that they face. The BBPA are in favour of some recommendations that came out of a recent review of the non-domestic market but are calling on Ofgem to ensure that these changes are implemented quickly and certainly in time for winter. The BBPA also believe that there should be parity between the protection of domestic and non-domestic energy users.
At the same time, UKHospitality have raised the issue of contracts that businesses (not just pubs) entered into when energy prices were at their peak. A recent survey of their members showed that energy costs have increased by 80% year on year and UKHospitality say that this is contributing to inflated business costs. They believe that, now prices are falling, businesses who agreed long term contracts fixed at peak rates should be allowed to renegotiate them at the current market rate. If Ofgem cannot facilitate this, the Government and the Competition and Markets Authority should step in.
LOAN ARRANGEMENTS
The Government’s Coronavirus Business Interruption Loan Scheme (CBILS) was a vital source of funds for businesses to get through the pandemic. The scheme offered loans of up to £5 million for businesses with a turnover of up to £45 million. The loans have now become repayable but interest rates have increased significantly since the time that they were taken out. The chief executive of UKHospitality, Kate Nicholls, has asked the business secretary, Kemi Badenoch, to instruct the British Business Bank (BBB) to arrange for the lending banks to extend repayment terms along the lines of a refinancing package. Some businesses are also still repaying ‘Bounce Back’ loans. It would be very sad if the loans that helped breweries and pubs survive the pandemic and its enforced lockdowns subsequently became the cause of their failure.