The BBPA, the leading trade association representing the UK’s brewers and pubs, points out that at an average cost of £3.81 per pint in the on-trade, pubs have lost up to £331 million in revenue on beer that they’ve been forced to destroy, being unable to sell it because of the three Lockdowns and similar tier restrictions.
The BBPA points out that this revenue would usually pay for hundreds of thousands of jobs in pubs and breweries across the UK as well as the maintenance and upkeep of pubs in communities across the UK.
From industry feedback, the BBPA has calculated that some 70 million pints of beer were wasted in the first Lockdown. Following the lessons learnt, publicans bought less stock on reopening following that first Lockdown as they became more aware of the effects of ongoing subsequent restrictions across large parts of the UK.
As a result, just seven million pints were wasted as a result of a further Lockdown in the Autumn and another 10 million are expected to be lost during the current UK Lockdown according to the BBPA.
With a UK Budget expected next month the BBPA is urging the Chancellor to extend the VAT cut for hospitality – currently down from 20% to 5% – so that pubs currently closed and therefore unable to avail of it can benefit from it on reopening.
The Association is also urging the UK government to extend the Business Rates ‘holiday’ beyond next month and to cut beer duty for when the pubs reopen.
In addition, the Association has urged the UK Government (and Chancellor Rishi Sunak) to continue providing support to the sector in the coming months if pubs are to remain closed.
“Our sector is in limbo,” said BBPA Chief Executive Emma McClarkin, “And at several points in the last 12 months pubs and breweries have effectively had to pour their revenues down the drain.
“We’ve no idea or clarity from Government on when we can re-open again. What we do know is if we cannot reopen in the near future, without further Government grant support and extensions to the job retention scheme, pubs and brewers will no longer have the cash left to survive and a wave of closures will be inevitable with jobs lost.”
She continued, “Even when they can reopen, pubs and brewers are still likely to need Government support to help them kick-start their businesses again.
“With a Budget coming up in March, we’re urging the Chancellor to continue to support our sector in what we hope are the final months of this crisis.
“If pubs remain closed beyond March, further grants need to be delivered to them and brewers. Without this, neither pubs or brewers will be around to brew and serve beer when we can reopen.
“Stimulus support is also going to be essential for our sector to kick-start again and lead the economic recovery. The VAT cut for hospitality, whilst welcome, has not been used as the sector has been closed. It must be extended.
“Likewise, the Business Rates holiday must be extended as pubs do not have the cash to pay it now because they have been closed.
“£1 in every £3 spent in a pub goes to the taxman because of excessively high beer duty.
“Having been closed or facing restrictions for the best part of a year, now is not the time to be punishing pubs and brewers with the excessive beer duty we pay in the UK. The Chancellor must listen to the 490,000 people who’ve signed the Long Live the Local petition and cut beer duty in his budget to protect pubs and jobs.”
According to a report from the BBC, a Treasury statement pointed out that the hospitality sector was receiving “significant support” including one-off grants worth up to £9,000, monthly grants of up to £3,000 and a £1,000 grant that was provided to pubs not serving food at the time during tiered restrictions when ‘wet pubs’ were forced to close.
It has also extended the furlough scheme until the end of April, provided 100% relief on business rates as well as cutting VAT for hospitality businesses.
The Treasury will outline the next stages of its plan for jobs to support businesses and families across the UK as part of the upcoming Budget.