The UK’s pub culture has a great role in not only supporting the economy but typically lie at the heart of our local communities. I’ve been a member of the Campaign for Real Ale for 25 years and am very passionate about the need to keep our beer and pub heritage going. Pubs need their duties to be lower across the board, so I have explained below what the Government has done in this regard.
Pub Closures
It is always disheartening to see a pub forced to close its doors permanently. I fully understand the challenges that closures pose for both owners and communities. Furthermore, I acknowledge the pressing issue of vacant high street units, which the proposed new high street rental auction process aims to address. The prolonged vacancy of shops and buildings poses a significant problem for our high streets, resulting in a direct and negative impact on footfall and risks other businesses shutting down.
As you may be aware, the Government is consulting on the design of high street rental auctions, including the introduction of a new permitted development right. This right would enable buildings that do not fall under the Commercial, Business, and Service Use Class (such as pubs) to change their purpose as part of the new high street rental auctions process. I would encourage you to share your views. You can do this by visiting: https://www.gov.uk/government/consultations/high-street-rental-auctions
It is important to note that our local authorities, who certainly know our area well, will use their knowledge discretion when using the new powers associated with high street rental auctions. I want to emphasise that the intention behind these auctions is not to interfere with properties whose landlords are actively seeking to fill their premises. Instead, the aim is to provide local authorities with a tool to address significant vacancy rates and low landlord cooperation.
There are existing mechanisms to support community groups to step in where pubs are at risk of being lost without intervention. Designating a pub as an Asset of Community Value allows communities a period of up to six months to bid and purchase the pub if it is put up for sale. Additionally, the Government's £150 million Community Ownership Fund assists community groups in buying assets such as pubs, ensuring they can continue to serve their local areas.
Beer Duties
In 2013, the Government took the decision to end the beer duty escalator, and beer duty has been frozen or cut several times since then. Duty on spirits has been frozen over the past two years. As a result of these changes, a typical pint is cheaper than it would have been had these measures not been introduced. I share your concern about the future of pubs and the hardship caused by the pandemic.
During the pandemic, the hospitality industry undoubtedly had some of the hardest time, but now the Government is implementing a long-term strategy to get our pubs thriving again. This includes an extension to pavement licences, making it easier and cheaper for pubs, restaurants, and cafes to make outdoor dining a reality. This will be implemented through the Levelling Up and Regeneration Bill. Additionally, the £150 million Community Ownership Fund allows community groups to buy assets so that they can continue to serve their local area.
Locally, we were able to secure an investment of £19,192,000 from the Government’s Levelling Up Fund. The money will help fund the transformation of the De La Warr Pavilion on Bexhill seafront and the development of new community facilities in Sidley, creating new jobs, upskilling local residents and bolstering career progression in the area’s creative and hospitality sectors, particularly for young people.
At the Spring Budget 2023, the Government announced a number of measures to support this industry. In order to protect small businesses the Government will keep the Small Profits Rate, maintained at the current 19 per cent rate, for companies with profits less than £50,000. This will mean that nearly 70% of companies will be completely unaffected, including many of our local pubs and hospitality venues. There will also be a taper above £50,000, so businesses only start paying the full rate of 25 per cent on profits from £250,000. Simultaneously, all tax categories, such as beer and wine, will be moved to a standardised set of bands, in order to support this industry.
There is also a £13.6 billion package of support. To protect businesses from rising inflation the multiplier will be frozen in 2023-24 while relief for 230,000 businesses in retail, hospitality and leisure sectors was also increased from 50 per cent to 75 per cent this year.
I welcome the Government’s commitment to supporting pubs through increasing Draught Relief, from the 1st of August as announced in the Budget. This will freeze the duty charged on a typical pint of beer in the pub and ensure this will always be lower than in the supermarket. This is alongside a new small producer relief which will build on the previous success of the Small Brewers Relief, which will benefit cidermakers and other producers of lower ABV drinks.
Also announced in the Spring Budget 2023, from the 1st of August, the alcohol duty system will be simplified, and rates will be uprated. Duty rates of all alcoholic products produced in, or imported into, the UK will increase in line with RPI. Draught Relief will increase from 5 per cent to 9.2 per cent for beer and cider draught products and from 20 per cent to 23 per cent for wine, spirits based and other fermented draught products.