Mixed reaction to Autumn Statement from sector bosses

By Gary Lloyd

- Last updated on GMT

Autumn Statement: trade bodies and pubcos give their opinions on the Budget (credit: Getty/andresr)
Autumn Statement: trade bodies and pubcos give their opinions on the Budget (credit: Getty/andresr)

Related tags Finance Legislation Government Autumn Statement

Sector chiefs have issued a mixed response to Jeremy Hunt’s Autumn Statement with many welcoming parts of it while others see “missed opportunities”.

The Campaign for Real Ale (CAMRA)​ chairman Nik Antona said extending the 75% discount on business rates bills for pubs in England for another year beyond next April is very much welcome - and much needed for pubs facing rising prices and the impact of the cost-of-living crisis.

He added: “The Chancellor admitted temporary measures like this couldn’t go on forever, so it is vital that the Government urgently reforms the grossly unfair business rates system which penalises pubs and puts their future at risk.”

He also called on the Scottish and Welsh Governments to commit to offering similar help for pubs with the burden of business rates and wants to see the UK Government find a way to help with business rates for the sector in Northern Ireland too.

“Freezing all alcohol duty until August 2024 is certainly to be welcomed,” Antona added. “However, this is a missed opportunity to give targeted help to protect the nation’s pubs, social clubs and taprooms by cutting tax on draught beer and cider served in pubs instead of an across-the-board freeze in all alcohol duty.

“Reducing the tax burden specifically on pints in pubs must be extended in the future to keep pub-going affordable and to help keep pubs open and at the heart of both community life and local economies by giving them a fighting chance of competing against cheap supermarket alcohol.”

Michael Kill, chief executive of the Night-Time Industries Association​ expressed concern regarding the Government’s fiscal decisions and is calling for the Government to be transparent in its long-term economic strategy, with clear thresholds for relief, as seen during the pandemic, in line with the Prime Minister’s ‘cut taxes over time’ statement.

He said: “At a time when hospitality sector business insolvencies are rising at a rate of 66% year on year, the statement has missed a crucial opportunity to support businesses, particularly small and medium enterprises, by implementing the substantial tax reductions required to ensure businesses can recover from the pandemic and cost of doing business crisis. These reductions could have offered essential financial breathing space, catalysing growth and stimulating investment.”

He added while the extension of the 75% business rates discount for smaller retail and hospitality businesses in England is welcome, this support will be wholly swallowed up by the announced increase in the national living wage.

Additionally, Kill pointed out the lack of a reduction in VAT. He argued that such a reduction would align the UK with several European counterparts, potentially fostering investment, growth, and overall business confidence.

He said: “The Prime Minister and Chancellor’s rhetoric of cautiously cutting taxes over time is at odds with the reality of the challenges faced with our current record high tax burden, particularly within the hospitality, night-time economy, and creative sectors. This burden is starkly evident when compared to other European countries.”

He also said the budget lacks support for industries grappling with the prolonged impact of the cost-of-living crisis and, although acknowledging the alcohol duty freeze, he noted a one-off election-year freeze “does not help a sector that is now taxed at unsustainably high levels”.

UKHospitality (UKH)​ chief executive Kate Nicholls said the “significant package” of business rates measures will help hospitality businesses across the country, adding UKH led the calls for Government to extend relief and take action on the multiplier and is “delighted” the Chancellor has acted on it.

She said: “The decision to freeze the small business multiplier will help those most vulnerable keep the lights on. However, the standard multiplier rising by 6.4% will see businesses representing almost two thirds of the sector’s trade still facing a £150m rates hike.

“This will only put more pressure on consumer prices and inflation, at a time when businesses are still grappling with high costs of energy, food, drink and wages.

“We’re pleased the Chancellor has also acted on our proposal and frozen alcohol duty until August next year. This is now one less cost venues have to worry about. With duty frozen, this should substantially constrain any cost increases passed on by drinks producers.

“Reforms to the planning system to drive quicker planning approvals will remove a significant barrier to business investment. This type of reform to reward the best performing local planning authorities is exactly the type of change we have been suggesting to drive growth in hospitality.

“While it’s disappointing that employer contributions to national insurance have not also been cut, the reduction in national insurance for employees will put more money in people’s pockets and provide a boost to hospitality in the New Year, often a challenging time for the sector.”

Reacting to the announcement beer duty will be frozen until August 2024, the small business multiplier frozen and hospitality business rate relief extended, Emma McClarkin, chief executive of the British Beer & Pub Association​ said: “The Government today has backed British business by supporting Britain’s great pubs and brewers who employ almost a million people across the country and the beating heart of communities.

“We welcome the Chancellor’s decisions to freeze beer duty until August 2024, freeze to the small business rates multiplier and maintain a business rate relief of 75% for pubs. These policy decisions will save our sector around £350m.

“They will help deliver growth across cities, towns and villages all over the UK, helping to level up the nation and spur growth in local economies. This headroom is critical, particularly with the national living wage increases – at more than double the rate of inflation – which will add over £240m to pub wage bills at this challenging time.

“However, the Chancellor has once again recognised the importance of our nation’s pubs and brewers to the economy and communities, and the importance of keeping a trip to the pub affordable.”

Steve Alton, CEO of the British Institute of Innkeeping​ said: “We welcome the news that business rates relief will be continued at 75% for 24/25, in line with our consistent calls on Government for ongoing support in this area.

“We also welcome the freeze on alcohol duty, not putting further pressure on top of embedded cost increases that our sector has been facing over the last few years.

“Today’s statement from the Chancellor offers some much-needed support for many of our members, all of whom are facing the most challenging and critical times for their businesses.

“However, as small businesses at the heart of their communities, many run by independent operators, the rise in the national living wage to £11.44 per hour will hugely impact the profitability of their venues. Whilst we welcome measures that protect workers, there must be recognition of the impact this mandated increase will have on our small pub businesses.

“We would like to thank all of our members who took the time to write to their MPs as part of our #MyPub campaign launched in the summer, calling for support from the Chancellor. Your voices have been invaluable in supporting our engagement with Government, making the case for this vital further support.”

Stonegate Group​ CEO David McDowall stated: “We welcome the Chancellor’s decision to place a freeze on the rate of alcohol duty and his commitment to continuing business rate relief.

“The business rate extension is particularly critical for our publican partners because, for many, it may be the difference between remaining open or having to close.

“As we enter the busy festive trading period, this announcement will provide some respite and comfort to the hospitality sector that has battled against a triple threat of soaring energy costs, rampant inflation and cost of living pressures over the past year.

“We hope to see the Government continuing to support the hospitality sector and doubling down on its commitment as we head into 2024.”

Meanwhile, Admiral Taverns​ CEO Chris Jowsey, said: “Over the past few challenging years, pubs up and down the country have proven their importance as social hubs for their communities, working tremendously hard to overcome every obstacle that has been thrown at them and yet they have continued to be one of the most heavily taxed business sectors in the UK.

“We welcome the measures announced by the Chancellor, including a freeze on beer duty and an extension to the business rates relief, which will reduce the unfair tax burden and provide many pubs with an opportunity to trade out of this economic crisis.”

Carlsberg Marston’s Brewing Company​ chief executive Paul Davies added: “We are pleased to see the Government respond to industry calls to refrain from imposing further increases to the headline duty rate for beer and to maintain the hospitality business rate relief.

“We have already seen insurmountable pressure on our industry, with brewers across the sector absorbing more cost pressures than ever before to try and ensure beer stays affordable.

“The Government’s acknowledgment of these challenges come as a relief, allowing businesses time to acclimate to the changes already introduced this year.

“The brewing industry is so deeply integrated into the fabric of the UK and continues to drive growth for the economy, so these policy decisions are a much-needed show of support, providing the stability the great British beer and pub sector needs during these uncertain times.”

The Society of Independent Brewers (SIBA)​ chief executive Andy Slee explained the body was grateful for the duty freeze announcement.

He stated: “After the double-digit increase in beer duty only months ago, independent breweries will heave a huge sigh of relief that duty is now frozen until next summer, allowing the new alcohol duty system time to bed in.

“The business rates discount being extension will also be welcome news for community pubs and taprooms, though a full reform of the system is still needed in the near future.

“However, there are a number of missed opportunities; firstly the decision to not extend draught duty relief, which could have provided a much needed festive boost to our community pubs and independent breweries.

“Secondly, there has been no announcement of support for small independent breweries seeking to meet the Government set net zero emissions targets. Breweries are increasingly conscious of their environmental impact and it is essential that targeted grants and subsidies are in place to encourage this.”

Boudewijn Haarsma, managing director of Heineken UK, which owns Star Pubs & Bars​, said: “The Chancellor’s decision to heed our calls to freeze duty and continue business rates support is a vote of confidence in pubs, brewers and cidermakers.

“We can now look to plan our investments in 2024 with more certainty. Jeremy Hunt was right to highlight the importance of the great British pint – our pubs sit at the heart of so many communities across the country and the moves made today mean publicans and pubgoers will be raising a glass.”

Clive Chesser, chief executive of Punch Pubs & Co​ said: “We are pleased the Chancellor has clearly listened, with the Government again recognising the vital contribution that pubs make to the UK’s economic and social fibre.

“The welcome announcements on alcohol duty and business rates will provide a positive stimulus as we continue to bring communities together, drive investment in jobs, and strengthen our status as a creator of real growth throughout the nation.

“A strong and sustainable economic recovery rests on the foundations of a robust and reinvigorated hospitality industry. It is imperative that we all continue to work together to protect our local pubs and the wider hospitality sector after an unrelenting period of pressure.”

Nick Mackenzie, CEO of Greene King​, said: “The Chancellor’s decision to freeze alcohol duty is a welcome lifeline for many pubs and breweries. The extension to the retail, leisure and hospitality business rates relief scheme, and freezing the small business rates multiplier, are also both welcome and will help provide vital respite to our tenanted pubs who are struggling with high costs in other areas.

“However, these will offer little support to businesses like Greene King that manage and invest in pubs in communities.

“Pubs play a huge role in contributing to the nation’s growth and employ hundreds of thousands of people across the UK. We've invested heavily in our pubs and the long-term future of our sector, but at the same time we’ve seen the cost of doing business continue to rise.

“We continue to invest in our brilliant teams across the UK but must recognise that the 10% rise in the national living wage will add extra pressure on pub operators across the country. We urge the Chancellor to continue to explore ways to reduce the costs facing all pubs, so the sector can help unlock the growth he is seeking.”

Simon Emeny, chief executive of Fuller, Smith & Turner​, said: “While the extension of the 75% business rates relief is good news for single site operators, this is a very disappointing Autumn Statement for medium and large pub companies.

“Having driven up the rate of inflation a year ago, the Government is now reaping the rewards by increasing business rates on all but the smallest pubs, when they should have frozen the business rates multiplier for pubs of all sizes. 

“Combined with a larger than expected increase in the national living wage, this will fuel inflation further in early 2024, and no doubt influence future investment in the sector – a sector that invests in its communities, creates sustainable employment for people of all ages and abilities, and acts as an engine of growth for the wider economy.”

Phil Whitehead, managing director for Western Europe at Molson Coors Beverage Company​, said the alcohol duty freeze will be welcomed by pubs.

“Beer makes up 70% of all alcoholic drinks sold in pubs and is vital to the hospitality industry’s success,” he said. “Having already seen a headline duty increase in August, a further rise would have been a hammer blow to the sector, so this announcement, combined with action on business rates, will help to protect the future of much-loved venues and breweries and give the industry a platform to drive long-term economic growth.”

Budweiser Brewing Group UK&I​ CEO Brian Perkins said: “We are pleased the Government is acknowledging the inflationary impact of excise taxes by freezing beer duty, however, the UK still taxes beer more than most European countries and British beer drinkers still pay the third highest beer tax in Europe. 

“To encourage growth in an Industry which contributes £26bn to the economy and supports over 936,000 jobs, a lower rate is needed.”

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