Fuller's: Chancellor must dump duty escalator

Fuller's has appealed to the Chancellor to dump his plans for an alcohol duty escalator in March, claiming last year's 17.8% rise in duty has had a "devastating" effect on the pub industry.

Fuller's chairman Michael Turner made the appeal as he announced the brewer and operator's results for the 43 weeks to 24 January. Like-for-like profits at its tenanted pubs are 1% down on last year and its own beer volumes are also down 1%.

There was some cheer in its managed division with like-for-like sales growth of 4.5% for the 10 weeks to 24 January, giving an overall uplift of 2.7% for the 43 weeks.

The completion of the acquisition of three pubs from Mitchells & Butlers will bring the total number of new pubs to five and its estate to 360 with the company "well placed" to make further acquisitions.

It warned that the trading environment was unlikely to improve in 2009 with increases in raw materials and energy costs and urged the Chancellor to drop his plans to raise alcohol duty a further 2% above inflation in March.

"Notwithstanding Fuller's own situation, the Chancellor's duty increase during the year of 17.8% has had a devastating effect on some of our customers," said Turner.

"It is essential that the duty escalator which was announced last year is now withdrawn, and that there should be no further duty increases in the forthcoming budget. Fuller's beer volumes are outperforming the market but the British beer industry is not resilient enough to pay any more.

"I appeal to the Prime Minister and the Chancellor to stop adding to the misery that licensees are suffering due to the economic downturn by adding any further burdens. The costs of compliance with the seemingly endless legislation that licensees have to cope with has meant that the tipping point has now been reached. The number of pubs closing their doors for ever has risen to a very worrying 39 each week.

"The British pub is the home of responsible drinking, and the envy of the world. The entrepreneurial characters that run their community pubs should be respected for what they add to our society, and not pilloried and legislated out of business."