June 20 2013 Latest news:
Thursday, March 21, 2013
Landlords have urged the government to keep the cuts flowing for Norwich’s community pubs - after raising a glass to the end of automatic tax hikes on beer.
Chancellor George Osborne yesterday announced he will scrap the beer duty escalator, which increased by 2pc above inflation every year, while also cutting tax by 1p on every pint from Sunday night.
Campaigners welcomed the “surprise” move as a sign Westminster is finally listening to their attempts to revive the industry, which is backed by the Evening News’ Love Your Local campaign, and halt the closure of several key community hubs.
But they warned the lasting legacy of recent government policies, from both Labour and the coalition, had seen beer duty increase by 42pc since 2008, with the 1p cut announced yesterday making little headway into that figure.
It also remains to be seen whether any price freezes or cuts will be passed onto customers, as publicans battle rising costs elsewhere in their budgets.
These include VAT, rising utility bills, staff wages, business rates and pub companies increasing rents and beer prices, while landlords also attempt to invest in their pubs to find new ways of attracting business.
Dawn Hopkins, who runs The Ketts Tavern and The Rose in Norwich, helped in the fight against the beer duty escalator including speaking at a mass rally near the Houses of Parliament.
She said last night: “I am very pleased. I didn’t expect it despite the fantastic campaign going on - pubs and drinkers have been overlooked for so long.
“There was hope it [the beer duty escalator] would change. The industry is struggling and the beer duty escalator is just one part of it - to have it recognised that it’s causing problems and by scrapping it may help our futures.”
Mrs Hopkins said the announcement will mean the price of a pint will not go up this year.
She said: “It’s horrible when you have to put prices up - it’s a disappointment to us and punters. If you try and absorb the price increases we’ve had from beer duty or brewers, and there’s very little money as it is, then there’s no money for the business, there’s no money to move things forward, employ staff and there’s very little money for publicans to pay themselves. No-one wants to work 60/70 hours below minimum wage.”
The Campaign for Real Ale (Camra) gathered more than 100,000 names on a petition which led to a parliamentary debate on the escalator last year.
It is estimated 18 pubs a week have been closing and about £1 of the price of a pint is taken in VAT and duties.
Phil Cutter, landlord at The Murderers in Timberhill, Norwich, added: “I don’t think there’s a single pub up and down the country which has not let out a cheer now the beer duty escalator has been scrapped.
“It’s a step in the right direction but it doesn’t resolve the disparity between the price we pay in pubs compared to supermarkets. But it’s a starting point.”
Mr Cutter said he will spend the coming days working out if prices will increase slightly or not.
He said: “Even though there’s been a reduction to the beer duty, overall costs are still increasing.”
Health concerns have been raised in response to efforts to make alcohol cheaper to buy, an issue Camra disputes. It claims higher beer taxes encourage people to purchase higher-strength alcohol which is sold at lower prices in supermarkets.
Wines and spirits are still set to be subject to duty increases from the government.
Victoria MacDonald, who runs the King’s Head in Brooke, south of Norwich, said it would be down to the wholesalers to determine whether the price of a pint would come down.
She said: “It’s more a case that it won’t go up now. However, a cut in VAT would have been fantastic, and that would have led to an instant change in the price of a pint.”
Norwich South MP Simon Wright said he believed the beer duty changes will make a “big difference to hard-pressed” pubs in the city.
He said: “Pubs play an important role in our city’s communities and are part of our heritage. Having previously raised the importance of scrapping the beer duty escalator with the chancellor, I’m very pleased that he’s responded.”