Opinion

'Back to normal’ no longer enough for pubs

By Paul Davies, CEO, Carlsberg Marston’s Brewing Company

- Last updated on GMT

Irreversible damages: 'The Government needs to demonstrate that the roadmap out of this pandemic provides timely, tangible support to every business in the hospitality sector and, crucially, supports the industry for the long-term.'
Irreversible damages: 'The Government needs to demonstrate that the roadmap out of this pandemic provides timely, tangible support to every business in the hospitality sector and, crucially, supports the industry for the long-term.'

Related tags: Carlsberg, Marston's pub company, Pub, Pubco + head office, Budget, Finance, Legislation, Vat, Beer duty

Paul Davies, chief executive officer of Carlsberg Marston’s Brewing Company (CMBC), outlines much-needed measures from the Chancellor’s Budget on 3 March to protect the future of the brewing, pub and hospitality industries.

It’s 11 ​March 2020 and Rishi Sunak stands at the despatch box in the House of Commons, and he begins his speech: “I know how worried people are. Worried about their health, the health of their loved ones, their jobs, their income, their businesses, their financial security.”

He said, in front of the nation: “Today, I want to set out our economic response, so we bring stability and security.” 

Truth be told, the whole of the hospitality and brewing industry is still waiting for stability and security.

Some may read this and think, 'how can brewers be affected when many people are still buying beer in supermarkets?'

The reality is, for many brewers, including Carlsberg Marston’s Brewing Company, the overnight loss of sales from closing pubs has had a devastating impact; to the products we brew, such as cask; the people we employee, particularly those in roles dedicated to serving on-trade customers; and to our wide and varied supply chain, from the raw ingredients we use to brew our beers, through to packaging and logistics.

This has in no way been balanced by any different sets of gains brewers have seen with off-trade sales.  

Over the past twelve months, the once vibrant and buzzing hospitality sector has borne a disproportionate burden in the economic handling of the pandemic. And what’s worse, there’s no solid evidence as to why this is the case. 

This despite the investment made in safety measures and world class staff training.

We need support now more than ever. If not, there may only be a handful of pubs reopening on 12 April, or 17 ​May, or 21 June for people to enjoy. 

Business rates holiday and beer duty cut ‘not enough’

It’s been touted during the Prime Minister’s Questions this week that the Budget will see a 5% cut in beer duty for the coming year – something which has been called for by the Long Live the Local campaign. The 500,000 signatures it has secured for its petition speak for themselves, and that this is a must.

Reports also suggest the business rates holiday for pubs may be extended again which we very much welcome to aid the recovery of the sector.

However, those measures alone are not enough to save our pubs and the brewing sector.

We are calling on the Chancellor to implement an extension of the current reduced VAT rate in place for food and soft drinks to be applied to all drinks, specifically beer.

This, in addition to bringing forward proposals in the Alcohol Duty Review which will rebalance the duty regime towards lower-strength products, is what is needed to support brewing and pubs as vital domestic industries. 

Time to act to avoid ‘irreversible damages’

The Covid pandemic has been the biggest crisis ever to hit the beer and pubs industry.

Furthermore, the difficulties of the past 12 months show just how much the brewing industry is reliant on pubs, and pubs on brewers. 

The speedy vaccine roll out – which we applaud the Government for – has given a glimmer of hope that we will all soon be able to go ‘back to normal’.

Except, ‘normal’ is no longer enough. 

While the sector is grateful for previous support, it’s now time to act to avoid irreversible damages inflicted by the Covid-19 pandemic.

The Government needs to demonstrate that the roadmap out of this pandemic provides timely, tangible support to every business in the hospitality sector and, crucially, supports the industry for the long-term.

This will make a significant difference to brewers and pubs in all regions of the UK – supporting jobs, local economies and the heart of the Great British beer and pub culture. 

I, alongside the many pub owners and landlords, the thousands of hospitality employees and the wider brewing industry, hope that come 3 ​March, we can finally say ‘cheers’ and toast a support package befitting our much-loved sector.

Related topics: Beer

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