Triple whammy could put 20p on a pint

Pubs could be forced to put up the price of a pint by around 20p in the space of just three months due to a triple-whammy of factors.

Major pub companies this week revealed hikes of between three and four per cent on drinks for tied licensees.

The move follows the rise in VAT to 20 per cent in January - which has already led to an average of around 7p being added to a pint.

And with the government expected to increase beer duty by two per cent above inflation - an overall hike of seven per cent - pubs could be forced to ask hard-up consumers to dig even deeper into their pockets.

BII chief executive Neil Robertson said many operators would swallow the rise but others had no choice but to pass it on to customers.

"If there is 7p added from VAT, at least 10p from duty and another 8-10p from price increases it is a huge amount to be passing on to customers.

"The bigger issue is that it widens the disparity between drinking at home and coming out and people will expect a better experience for their money."

This week pubco giants Punch Taverns and Enterprise Inns informed licensees their drinks prices would be going up by an average of 3.3 per cent and 3.8 per cent respectively.

Both pointed to rising wholesale costs for the hike.

Greene King has also revealed an average price increase of 3.8 per cent on drinks. Marston's has as yet not decided if it will increase prices to licensees.

Mark Reynolds is operations director for the five pub strong London group Renaissance, which has leases with both Punch and Enterprise. He said the company would swallow rises from the pubcos but could act after the Budget next month.

"We did a 10p rise with VAT and we will wait until after the Budget but could put on another 10p. We were talking about the £4 pint two years ago and we with some premium brands we will be getting close to £5," he said.

Meanwhile Brigid Simmonds, chief executive of the British Beer & Pub Association, has urged the government to ditch its duty escalator - a move that has been backed by CAMRA.

She said: "With these inflation figures, and along with the VAT increase, the Chancellor is set to introduce the biggest ever rise in tax on beer in a single year.

"The government is creating a vicious circle of rising taxes causing further rises in inflation, which leads to yet more beer tax hikes in the future."

The Budget will take place on March 23.