Call for 1p beer duty cut won’t make a blind bit of difference to pubs!

BBPA A4 Campaign poster FINAL (no crop marks)CAMRA has joined forces with brewing trade associations and is calling for another 1p reduction in beer duty in the forthcoming budget, according to the February edition of what’s brewing.

CAMRA chief, Tim Page said, “The ending of the beer duty escalator and three consecutive beer duty cuts have kept pubs open and kept the price of a pub pint down. The Centre for Economic and Business Research (Cebr) calculated that these changes have saved more than 1,000 pubs from closure benefiting pub goers and communities throughout the UK. Britain’s 15 million regular pub goers will be hoping for a fourth beer duty cut in March’s Budget.”

Sounds pretty cool to me. So who are the brewing trade associations involved then? That would be SIBA the and British Beer and Pubs Association (BBPA) ‘The voice of the British pub and beer industry’ who are distributing 100,000 posters, beer mats and postcards. The thrust of the argument is a report commissioned from Oxford Economics in 2014. I get the gist of it, more beer sales, more pubs = more jobs, more tax revenue, but I’m not seeing the connection in their erudite report with beer duty.

Now it’s all well and good this campaigning, but does it make any difference? Especially when you consider that all previous reductions in beer duty have been an odd penny here and there and I don’t think anyone is expecting any more than that, are they? Having given it some thought and a little research over the weekend, I reckon it could make a big difference, but to whom?

Over the last few days, I’ve drank in three local licensed premises, all within walking distance from my abode: a Sam Smith’s pub, a free of tie leasehold pub and a trendy bar. Now as most people will know, outside of the metropolis, Sam Smith’s Old Brewery Bitter is £1.80 a pint, which all things considered is dirt cheap and an anomaly when compared to most other on licensed premises. In the free of tie pub, a very nice pint of Cross Bay Brewery Zenith (5%) was £2.90 (could also have had Leeds Pale or John’s). Now in the trendy bar, with a choice of five or six real ales and a similar amount of Lagers, plus diverse bottles, for a pint you would be paying £3.60 to £4.50, depending on what you drank. Brewers and styles are many, but Vocation brewery  are often disproportionally represented in this establishment, which is double plus good. I’ve always gone with the attitude of, you get what you pay for and if you don’t like the price then you can vote with your feet. On a Friday night I have been known to have a drink in all three said establishments, I know what the prices are, I can pay and I don’t mind paying. To be fair if I pop on the bus into town then the prices in our rural/suburban trendy bar are roughly the same as they are in anywhere decent in Leeds city centre. I checked things out with my mates, we agreed, we spend most of our drinking time in the Sam Smith’s pub, not because of the price, we don’t mind paying, it’s just that the dynamics of this pub suit us, most of the time. In simple terms it’s nearby, it’s a good pub, with a decent tea time trade. Price is not something we use to choose.

I did a bit of market research with an old mate who’s a retired widower. We’ll call him Albert to protect his identity. Now Albert favours a Sam’s pub, not out of dire financial necessity, more to make his pension go further. As well as drinking in our local he also goes on the bus into the nearby town for a lunch time pint, again in a Sam Smith’s pub.

“What would you think if they reduced beer tax by 1p Albert?” I said to him.

“It wouldn’t make any difference Rich would it, a penny on £1.80! We’d never see it anyway, they’ve reduced it for the last three years on the trot and the price hasn’t gone down, has it?”

“That’s a fair point Albert, but why don’t you drink in the one up the road?” I says.

“What, nearly three quid a pint, at that price I could only afford to go out a couple of times a week. In fact if I didn’t have me bus pass, I couldn’t even afford to go into Wetherby every lunch time, it’s four quid there and back if you have to pay.”

We had a bit of a natter about where the reduction in beer duty keeps pubs going, or not and we came to some conclusions: Plainly, the reduction of beer tax by 1p per pint doesn’t make a blind bit of difference to the average drinker, even if they see a reduction in price. It’s also clear that a lot of people are prepared, even in the provinces, to routinely pay anything upwards of £3 and often well over £4 a pint. Now me and Albert reckoned that the only way you would benefit from a 1p reduction in beer duty would be if you supped a million pints a year. Now that would be a real saving, wouldn’t it. But no one sups that much ale do they? Hold on though, what if you were making millions of pints a year and you had to pay 1p a pint less, you’d be really making some extra brass then wouldn’t you?

Okay, okay, I get it that the brewers support the pub trade and that if we had no brewers then we’d have no beer and no pubs. It just seems to me that the only people that will benefit from any paltry reduction in beer tax are the brewers. Hence they have jumped into bed with CAMRA and a few politicians. Personally I’m unsure whether this sits well with my outlook on where CAMRA should be. CAMRA member Michael Pannell from Essex asks Why just a penny (Letters, What’s Brewing, Feb 2015) and calls for a cut of 30p at the minimum on the current 52.2p a pint duty. I agree with him and think that would really make a difference to a lot of people, not just the brewing industry (if they passed the reduction on in full). It might even get more people back into pubs. It’s not the only thing that will get people back into pubs though and there are so many factors that commentators, particularly CAMRA, always seem to miss.

Like my mate Albert says, if he didn’t have the use of his bus pass he wouldn’t be able to afford, along with a lot of other retired single blokes, to go into Wetherby for a pint and a chat and maybe a pub lunch on market day. Similarly I know lots of people who are paying serious amounts of cash for routine child care, cash that they would love to spend in pubs/bars/restaurants, if only they could afford the babysitter.

Although I think the BBPA puts forward a reasonable argument, the benefits will only be to it’s members and an adjustment of an odd penny on beer duty isn’t going to make a blind bit of difference to me or Albert or anyone else with a shed load of bills and financial commitments.

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2 thoughts on “Call for 1p beer duty cut won’t make a blind bit of difference to pubs!

  1. You really need to make a comparison with keeping the escalator in place, or at least raising duty in line with inflation, rather than with freezing it. Yes, 1p a pint is neither here nor there, but if the escalator had continued for three more years we would now be paying 20-30p a pint more in pubs. And that would have made a big difference.

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    • I fully accept that Old Mudgie, but the beer escalator is no longer in place and I still contend that the only people who will benefit from the proposed 1p reduction will be the brewers. Hence my surprise at CAMRA closely aligning themselves with this industry led campaign.

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