Beer Duty / Business rates / Pubs / Taxation / 03 March 2021
BBPA responds to Chancellor’s Budget worth over £1.5 billion for brewers and pubs Responding to the Chancellor’s Budget speech, Emma McClarkin, Chief Executive of British Beer & Pub Association, said: “We welcome the Chancellor’s announcement of continued support for the devastated pub sector in the form of additional grants, as well as extensions to the job retention scheme, 5% hospitality VAT rate and business rates holiday. “The new grants are worth £400 million for pubs and will go some way in helping many of them survive through to the time when they can reopen and operate viably. It is, however, crucial that the Government ensures all pubs benefit, including those that are part of a group, by removing the current State Aid cap. “The extension of the job retention scheme until September will help save thousands of pub jobs. Worth £700 million to our pubs and brewers, it gives the sector time to reopen and rebuild trade before bringing all staff back, which would otherwise be too costly and unviable whilst still facing trading restrictions until end of June. “It is imperative that the Government allows pubs to operate without restrictions as planned from 21st June. This will give them the best chance to get back on their feet and serve their communities. “Extending the 5% VAT hospitality rate until September and at 12.5% thereafter is most welcome. We calculate it is worth £485 million to pubs. With all pubs having been closed for so long, the lower VAT rate has been of limited benefit so far, tens of thousands of pubs will not benefit from this until they reopen on 17th May at the earliest and then still at reduced capacity. However, wet led pubs will be especially disappointed again that the reduction will not apply to all beverages so they too can benefit from this. “We campaigned hard for an extension of the business rates holiday and the Chancellor announced a 100% cut on rates until June and up to a 66% cut for the following 9 months. This is good news, but the proposed cap will mean many pub businesses will not benefit fully from this. We await to see more detail. “Having called for a cut in beer duty and being a staunch supporter of the Long Live The Local campaign, a beer duty freeze will be seen as much needed short-term relief for the sector. However, the Chancellor has only partially listened to the 500,000 campaign supporters who signed the petition calling for a cut in beer duty. We now hope the Government will use the ongoing Alcohol Duty Review to cut beer duty to support our brewers and pubs and level the playing field with other brewing nations. The Government must support and promote Britain’s extraordinary pub and brewing sector in the way other Government’s support their domestic industries. “Overall, this is a good Budget for pubs and breweries in the short term, reflecting just how vital they are to the social, cultural and economic fabric of our communities. “However, this is just the start of the journey on the hard road to long-term recovery for our sector. The Chancellor has made it clear today he recognises the vital role local pubs play in their communities. Now he must continue that commitment by ensuring Britain’s pubs and breweries are supported in the long term. This should start by extending the VAT cut on hospitality to all drinks until at least the end of the year. We also need a fundamental reform of VAT, business rates and beer duty to ensure that the thousands of pubs and breweries across the UK can thrive and help drive the social and economic recovery we urgently need.”Read more
Brigid Simmonds | 15 March 2019
This article first appeared in the print edition of The Morning Advertiser The 4th to the 8th of March was National Apprenticeship Week 2019. Now in its twelfth year, National Apprenticeship Week offers both an opportunity to celebrate our fantastic apprenticeship schemes, but also promote their importance to pubs and the wider hospitality sector. I am one of the many advocates of apprenticeships. I did not go to university myself and after working in the hospitality sector for the best part of 25 years I have met, know and admire many people for whom the apprenticeship route into employment – or during their employment – opened the doors to an exciting and rewarding career in a pub or other hospitality business. It is one of our sectors best kept secrets that you can be running an exciting business at, or even before, the age of 25. For entrepreneurs who enjoy working with people, it simply offers one of the best possible careers out there. The success of apprenticeship schemes is in part down to sectors like our own leading the way in embracing them. It is also essential, however, that everyone across Government and in educational establishments recognises the apprenticeship route into employment, so they are not seen as second best to university degrees. The Hospitality Showcase event on apprenticeships hosted in Parliament during National Apprenticeship Week is exactly what industries across the UK should be doing to promote apprenticeships. I was proud to see so many pubs and brewers at the showcase event, demonstrating the enormous breadth of training and apprenticeships we offer. The Leisure PR team did a fantastic job to encourage thirty organisations to set up stands in the House of Commons. Pubs alone employ around 600,000 people and there is a real need for us to attract and retain great employees who inspire customers to come to our venues and be so impressed that they return for more, again and again. Apprenticeships have a key role to play in this and in hospitality and catering there are currently 14 different apprenticeships standards, from bar supervisor to commis chef. Between 2013 and 2018, 165,000 people started apprenticeships in hospitality and catering – many of them in pubs. As we prepare to leave the EU, we may start to see some challenges in recruiting overseas workers. We must start attracting even more UK talent to work in our pubs, but with almost full employment that’s not going to be easy. It’s clear to me that as an industry we need to do more to convince people of the future of pubs and hospitality and the great careers they can provide. Continuing our great work with apprenticeships and promoting our careers in schools and colleges is key achieving this.
Paul Oakley | 08 October 2018
With the nation gripped with ‘football fever’ as Gareth Southgate and the England team rekindled the nation’s love affair with its favourite sport as well as the hottest summer on record for 40 years, breweries and pubs across the nation worked tirelessly to meet the demand of thirsty punters. BBPA predicted that England reaching the semi-finals would boost the beer trade by an extra 40 million pints. However, even the optimists among us wouldn’t have predicted the results for the industry. Perhaps it was the soaring temperatures, or maybe the new trend to throw pints in the air in celebration (and with the number of goals England scored against Panama in the Group stage, this could well be the case), but ‘football fever’ led to an increase in 130 million more pints this Summer (June to August) than the same period the year before according to the BBPA’s Sales Volume Survey of its members. To put this into perspective, that is enough beer to fill 30 Olympic sized swimming pools or half a million bath tubs. Not only is this a significant boost to the beer industry, but the UK economy no doubt benefited as well. BBPA estimates this to be an additional £390 million to GDP, as well as a £71 million contribution in taxes through beer duty, as well as another £37 million in VAT. Speaking to our members highlighted the undoubtable benefits of tournaments such as this. Julian Momen, MD, Carlsberg UK “Taken together, this lovely British summer with England’s creditable performance in the World Cup has been a rare treat; one that’s worked wonders for the beer category. Good for UK brewers, good for stores and good for the great British Pub. But most importantly, good for the beer drinkers across the UK, regular or new, who have been able to enjoy an ice cold lager or maybe a hoppy craft IPA - out in sun, at the BBQ, or watching the footy on the big screen.” Heydon Mizon, Joint Managing Director, McMullen & Sons “The world cup was a tremendous event for our more wet led pubs. Belief in the English team was perhaps initially lacking but as confidence grew so did the positive atmosphere and sales with many sites setting a new sales record for the day. We loved each goal as guests seemed to enjoy dispensing their beer into the air in celebration, which is certainly something we wish to encourage." Tom Davies, Chief Executive, Brakspear “It’s been a summer to remember across the Brakspear estate. Our lovely riverside home town, Henley-on-Thames, has been at its very best in the sunshine, and our many rural pubs with gardens have been packed with thirsty customers enjoying the weather. The success of the England team in the World Cup did take a few pubs by surprise and many who’d not planned to show it changed their minds as the home team kept winning! All in all, these have been ideal trading conditions for the majority of our pubs and we could certainly get used it!” Hearing from pub owners also demonstrated the outstanding benefits of the World Cup and the hot summer for pubs. Paul Williams, the Duke of Wellington, Twyford The Duke of Wellington can only hold around 80 people inside and in previous World Cups this was a barrier. This time round, Paul transformed his pub’s car park into a temporary garden with a large outdoor screen. The total cost for this transformation amounted to £1,900, but after promoting the changes on social media the investment paid off. “Trade was up significantly. On a normal weekday we night take £1,000 but during England games we were hitting £6,000”. Not only did it boost profits on the England games but Paul reported the longer term positive effects of the tournament, particularly that it has significantly helped to market the pub generally as well as introducing to new customers. “We now attract customers from a wider area and continue to use the outside screen when weather permits for Premier League games. We’ve had an overall increase in trade since the World Cup with many new faces enjoying the atmosphere and vibe of our pub.” “We have a great drinks offering and good support from Brakspear too, but we’ve thrived on the events side. Putting experience of that and other businesses we’ve run previously is how we’ve grown trade. It’s the understanding of your community that I think is key to any offering.” Paul is looking forward to benefit from future sporting events such as the next big boxing match in September which will benefit from the outdoor screen area, as well as community sporting events such as hosting events for darts teams, cribbage and their sponsored football team. Simon Chudley, the London Inn, Okehampton When speaking with Simon, the owner of a freehold pub with a niche sports offering, he explained that he was not anticipating the World Cup. Prior to the tournament, he did not do any specific promotions for the tournament as he was already known by locals as the sports pub. Simon installed a 16ft screen in the pub’s function room, doubling the area which customers can fit into, and the impact was outstanding. “The first game was a bit slow, but as the enthusiasm grew with England’s success, our sales took off and the pub filled more and more with each game. Over the month, drinks sales were up 200% on the previous June”. Simon reported that during the England vs. Colombia match, his profits were the same as they would be in a week. Simon discussed the long term effects of the World Cup. “Not only were sales up during the tournament itself, but the hot weather has continued to drive high profits, with a number of new returning customers wanting to drink in the garden. There has also been an influx of people coming to the pub after work to enjoy the weather”. Simon is looking forward to the rest of the year, the new season of football, the Six Nations rugby and England rugby’s international games.
Paul Oakley | 25 July 2018
Forty-seven companies contributed to this year’s Annual Barrelage Survey, the industry’s definitive measure of the UK beer market. The headline result being that beer sales were 0.7% higher in 2017 compared to the previous year. As usual the tables and report are free to all members of the BBPA, if you would like to receive a copy then please contact me. But non-members don’t need to be too concerned - the report is available in our shop here. So just how much beer was sold? In total, Brits enjoyed over 7.75 billion pints of the nation’s favourite drink, that’s 21.2 million pints every single day. Or to put it another way 28.9 million kegs plus 4.9 million casks plus 3.2 billion cans plus 3.3 billion bottles. Or 1,762 Olympic swimming pools! So what insights can we gauge from the report? Here are three interesting insights that paint us a picture of the world of beer in 2017. Pubs are under increasing pressure The long term trend seeing people favour a beer at home over their local has continued. 53.1% of beer sold in the UK was sold through the off trade in 2017, the highest this figure has ever been. Of course there are many social factors driving this trend. The home is a very different place than it was in 2000 due to improvements in home technology. People also tend to have less leisure time than they used to, as well as the rise of social media which means you no longer need to leave your house to see friends. However, what is surely the biggest driver is the rapid increase in the price of a pint in pubs. In fact, in the last ten years, the price of beer in the on trade has increased by 28.6%. This compares with an increase of 8.5% in the off trade. Pub-specific cost pressures like business rates, which sees pubs pay an unfair burden of the total high street bill. As well as the National Living Wage and VAT means it looks likely that this worrying trend will continue into the future. Pubs are also reeling from crippling duty increases of over 42% between 2008 and 2012. Three cuts and a freeze had relieved some pressure on pubs since then but last year’s 3.9% hike has increased the challenge further. Draught Ale innovation Back in 2000 Nitro Keg Ale was the most popular style of keg ale with 42.2% market share. Fast forward to 2017, Nitro Keg Ale volumes have fallen 69.2%. Contrast this with Cask Ale which has been relatively resilient to market pressures over the same period and now comprises 57.9% of the market for draught ale. However, in 2017 it is Traditional Keg Ale which is the category in growth with volumes increasing by 9.6% last year. There is certainly a large appetite for draught ale currently and this “new wave” of keg beers is being driven by new tastes in the market but also through innovation by new and existing brewers. Changing tastes are always difficult to predict and it will be interesting to see if this continues in future years. The rise of No and Low Alcohol Beers No and Low Alcohol Beers have always been of interest to consumers and industry alike, however sales remained stagnant for a long time. Since 2013 we have observed an exponential rise in sales of these beers. In fact, in 2017 alone volumes increased by 25.9% while volumes have grown by a staggering 150% in the last four years. No and Low still only account for 0.5% of the market however so there is room for even more growth. Whether this trend is driven by demand for a healthier alternative or an improved supply of quality products through brewing innovations we welcome this interesting trend.
Brigid Simmonds | 12 June 2018
This week I had the pleasure of going to a prison in Brixton to lunch with Clink, the charity set up to train offenders in hospitality who are within six to eighteen months of finishing their sentences. Clink run four restaurants in Brixton, Cardiff, High Down and Styal and they also have a presence in 7 prisons, where they operate bakeries and gardens, growing produce for their prisons and even keeping chickens! I was first introduced to Chris Moore, CEO of Clink, by Paul Hegarty at the Publican Awards this year, and I very much believe that as part of our outreach to employ more UK nationals, the Clink would be a very good partner for many in our industry. The facts speak for themselves. There are 84,000 prisoners in the UK, but only 4,000 are women. 49.6% of prisoners re-offend, but for those who come out with Clink’s hospitality training, that is cut to just 8%. I visited the Brixton Clink restaurant, which requires you to leave your belongings in a locker and go through full security before entering the restaurant. Whilst this may be an unconventional dining experience, the food itself was excellent and the surroundings and décor were just like that of a high end restaurant. There was no alcohol and you have to eat with plastic knives and forks, but the standards of service and presentation of the food are superb. The Clink trains chefs and front of house staff up to NVQ Level 2. They also prepare them for the world of work and life after prison. When you leave prison, there is no requirement to have somewhere to stay. You are let out with £40 and the rest is up to you. With the Clink, ex-offenders are not only ‘work ready’, but they are looked after in the community. So, what can our industry do to help Clink? Whilst they are a charity looking for donations, they are also looking for offers of work. If there is accommodation to go with it, so much the better. This is where our industry can really help. Clink are clear that they do all the necessary checks, and they will give you all the information about an ex-offender you are looking to employ. Most importantly of all, they firmly believe that many of their ex-offenders will be exceptionally loyal to their new employers for many years. Why? Because they have been offered a second chance. For more information on Clink and how your organisation can support them, visit their website here.
Brigid Simmonds | 12 June 2018
Once again, I had the privilege this year of judging The British Institute of Innkeeping’s (BII) Licensee of the Year award, an inspiring competition for every licensee in the industry. The quality in the competition this year was extremely high. 250 entrants were whittled down to 50 who received mystery customer visits. From there, the remaining 12 entrants faced a tough round of individual interviews including Sue Allen of the BII and Ashley and Kelly McCarty of the Olde Sun Inn at Colton near York. The Chairman of the BII and three trustees picked the final six, who were then put through their paces in front of an industry panel, which included me. The final six were all very impressive and inspiring. We saw: Marc Duvauchelle, a proud Frenchman who manages the Old Customs House at Gunwharf Quays in Portsmouth. Marc has a background as a restauranteur and has already won the Fullers Griffin Trophy and features on the new Gunwhalf Keys television advertisement as a key attraction. His philosophy is about quality, whether it be an order for pint of Pride, a chateaubriand or pie and mash; they all have to be exceptional. Using chalk boards to advertise his best expensive dish often leads to it selling out within an hour! One of his greatest frustrations is the effect of the British weather on sales. Lee & Kerris De Villiers, licensees originally from South Africa, who operate the Pig and Whistle pub owned by Ram Pubs (Youngs) in Wandsworth. They have benefitted from investment which has transformed the look and feel of their pub, helping them to grow their business by 25%. Their new marketing plan includes a Tequila cabinet (which they operate free of tie) and a cabinet with chilli sauce from all over the world. Their support and sponsorship of a South African rugby team has also paid dividends in terms of numbers of customers and revenue. Their major concern is increased business rates and how this makes their Sky subscription more expensive too. Kim Barker, who runs the Ship Inn, a tenancy owned by St Austell in Pentewan, Cornwall.Operating a pub in a village with many holiday homes, Kim has used events such as bingo, quiz nights and even a beer festival to attract people to her pub. As she says, you don’t have to be local to be treated as one and that certainly rings true, as after ten years of running the pub she decided to have a party with many of the ‘seasonal locals’ coming down to celebrate in November. Chris Norfolk, a chef by background who runs a Punch pub near Worksop in Derbyshire, the most northerly pub to enter the competition this year. In his entry Chris noted how he runs ‘a proper country pub’ featuring muddy boots, horses, dogs and shooting. He has ran hotels and large branded pubs in the past, but is clear that his pub is not restaurant in disguise. As he says himself – “we are pub serving good food, sourced locally and made by me and my team.” Training is key to his mode of operation and his major concern is control of electricity costs. Mark Shaw is the owner of the Castle Inn at Castle Donnington, Leicestershire. Once a closed pub bought some years ago from Punch, Mark has grown the Castle Inn from a zero-turnover business to a thriving pub complete with a restaurant, bar and wood fired pizza oven. The latter of which can cover their costs quite quickly, but do not take up too much space and work particularly well for community pubs. Alex and Tanya Williams, tenants at the Polgooth Inn near St Austell. Alex and Tanya have developed their garden (which is not far from the Lost Gardens of Heligan), specifically to grow produce for their pub. It has been a huge success so far growing cucumbers, fresh herbs and fruit which have all been used in their kitchen. There were infrastructure costs to create it, but it now very much pays its way. A great way Alex and Tanya encourage families to come to their pub is to run pasta courses for children in the winter months. The courses themselves are not-for-profit, but they result in more regular customers. A pub at the heart of their community, Alex and Tanya managed to persuade all 140 properties in their village to display Christmas lights! Whilst they think about whether they might, with the help of St Austell, extend their kitchen, they have decided to invest in a pizza trailer to test demand. Their greatest challenge is to recruit and retain staff who understand the benefits of a career in our industry. During the panel sessions I found it particularly interesting to see what the finalists saw as their biggest challenges. All the finalists listed finding pub chefs as a real challenge, although they had a variety of ways of trying to solve this, such as providing accommodation and offering courses like ‘game in a day’ and sausage making. No one felt that the National Living Wage helped staff retention; almost all had to pay more to keep good staff, but as they are all excellent licensees, good training and support achieved loyalty and longer service for a good length of time. Business Rates were also a key theme and there was huge support for anything that could be done to reduce the very high costs faced by our sector. Quite rightly Alex and Tanya were crowned BII Licensee of the Year. I interviewed them both at a conference a couple of years ago, delightful, full of energy and welcoming, they thoroughly deserve the award and I am sure they will be great advocates for our industry, as well as the BII. I am also very honoured to have been made a Companion Member of the BII. It is a great organisation for individual licensees and one that the BBPA is very keen to support.
Paul Oakley | 16 April 2018
We are delighted to announce the launch of our new website! We hope you agree the new look is a small improvement on what we were sporting previously. The best news is that we have created a much more navigable website. This means that whether you are a BBPA member, a publican or simply a member of the public interested in beer and pubs all our wonderful news, campaigns, statistics and guidance is right at your fingertips. We also want to update you on several brand-new website features. Some of these are open to everyone but a fair few are exclusively for our members. If you are a BBPA member, make sure you have your log-in information to enjoy all the benefits. We will now run through each section of the website to ensure you can maximise your enjoyment of the new website and make use of the new features. KEY FEATURES/SECTIONS News We’ve kept our News section simple. Using the search function, you can toggle articles and blogs or search by topic with ease. All of our latest and most popular news is highlighted so there’s no reason not to keep up with all the latest goings on in the industry. About In the About section you can learn all about the rich history of the BBPA. You can also see what we’ve been up to lately and how to get in touch with the whole team. Our Passion We are passionate about beer and pubs. In this section you can read all about the industry, from the history of pubs, to how beer is made or articles on working in the industry. Take some time to have a read and become beer and pub experts, just like us! Members Our members are at the heart of everything we do so we want show off who we represent in a great new format. Here, all our members and associate members have a profile, a short introduction and links to their website. The Licensee Forum is new to the website. Free guidance is available to all licensed premises, ranging from advice on health and safety to responsible retailing. The contact box is for those interested in joining the forum, as well as giving you the opportunity to ask us any queries. Campaigning Campaigning is a huge part of what we do at the BBPA. The new campaign section lists all the campaigns which we are currently working on, discussing why we are doing them, and gives you guidance on how you can get involved. Policy We cover a wide range of issues and over the years have produced a lot of content. To help you get to the information you need we have organised our policies by topic. Simply click through to the Policy Area you are interested in and get lost in the BBPA policy team’s fountain of knowledge. Export Hub The Export Hub is a one stop shop for all things exports. You can easily download our Export Strategy and Best Practice Guide. We have also built an Export Showcase. This features brewers dedicated to promoting British Beers abroad and we will work with Government and others to signpost international buyers to this page. We want to grow this over time and hope all our members get involved, so any members who want to be showcased on this section should get in contact via the contact form on the page. We have also launched our new Country Profiles page. We have been working hard researching all the different regulation and labelling requirements of key markets. If you’re trying to get involved in this market we are sure the information on these pages will be invaluable to you. However, this section is restricted to our members. Statistics We work closely with our members and keep up to date with the latest insights to ensure we have industry-leading statistics. We have produced all-new charts detailing the key facts and figures. Explore beer sales over time, see how many pubs there are in the UK, and gain insight into the latest stats on exports. This section comes with additional benefits for our members; simply log in to access a wider range of data than the public view. Shop We have updated our shop. Our products should be much easier to find and we have a new speedy checkout. All this means it is even easier for you purchase what you need. Statistical Handbooks, guidance on CO2 in Cellars, Energy Best Practice…you name it, we have it. Members’ Area Members now have a bespoke new area which will also make it much easier if you sit on any of our panels or expert groups, or indeed would like to get involved with them. Here you can find policy position papers, parliamentary briefings, industry updates, technical circulars, as well meeting minutes and agendas. Additionally, a new diary of upcoming events means you need never miss another meeting. What now? There’s still lots to do! You will notice throughout the website we have inserted feedback forms. We want to hear from you on any issues and we want you to share your knowledge and experiences, as well as recommend any improvements. One thing we have learnt from this project is that you can never have enough photos! So if you have any photos of beautiful pubs, the wonderful people involved in the industry or pictures of delicious beers then we want them! Please email email@example.com. Lastly... A big thank-you to Lighthouse London who have done a great job on the website. Check out their own website to learn more about their design, development and digital strategy expertise.