Our pubs and breweries are a uniquely British phenomenon, with a rich tapestry of heritage woven throughout our country's history. Today, they play an important part in shaping our culture, community, society and tourism. However, both of these face an existential crisis in the wake of high inflation, which is impacting energy, fuel, ingredient and product pricing, that has created a cost-of-living crisis. The price of a pint is seeing exponential rises. Coupled with pressures on the cost of living, people are being out-priced from visiting pubs and this is leading to pub and brewery closures, and job losses.

Headline Challenges*

For the first time, England and Wales has under 40,000 pubs, with 7,000 closing in the last decade. At that rate, there will be no pubs in 50 year's time. 46% of businesses are considering insolvency. 45% of hospitality businesses have been forced to reduce operating hours. A sixth of those businesses have no cash reserves remaining. Fuel duty and VAT is making up 45% of the cost of a litre of fuel. Finally, the Craft Beer Report 2022 shows breweries have reduced cask ale production by 21%.

The UK Government Needs to Act Now!

It is essential for the UK Government to step in now, before it is too late. We are asking for the Government to:

1. Introduce a relief scheme to help small businesses with soaring fuel prices
2. Introduce a relief scheme to help small businesses with soaring energy bill payments
3. For the 2022/23 Retail, Hospitality and Leisure Relief Scheme to be extended to small businesses in the supply chain
4. Look at the early implementation of Draught Duty relief, with two additional considerations: 
   1. Further relief applied to traditional cask real ale
   2. Further relief offered to small businesses that produce draught beer and cider 

* New research by Altus Group released on 4th July 2022 shows that the number of pubs in England and Wales has dropped below 40,000 for the first time. This is a drop of 7,107 in the last ten years. Continuing at that rate, in approximately 50 years' time, England and Wales will have no pubs left. 

According to new research by Cedar Dean released on 1st July 2022, almost half (46%) of businesses are considering insolvency. 

The British Beer and Pub Association (BBPA) recently reported that 45% of hospitality businesses, including pubs, bars and taprooms have been forced to reduce opening hours. A sixth of businesses have no cash reserves remaining. The biggest factors behind this are revealed as being the rising costs of energy (74%), goods (55%) and labour (54%). 

Fuel Duty is currently 52.95p, with VAT set at 20%. Based on the RAC Retail Price Index of 190.32p per litre of petrol (dated 15th July 2022), taxation costs make up 45% (84.67p) of the cost of a litre of fuel. 

The current eligibility criteria for the 2022/23 Retail, Hospitality and Leisure Relief Scheme does not include supply chain businesses, for example, Breweries. A cut in Business Rates targeted at Small Business will assist survival, secure jobs and aid future growth. 

According to the Society of Independent Brewers (SIBA) Craft Beer Report 2022, member breweries have reduced their traditional cask real ale production by an average of 21%. A preferential rate of draught duty on this type of beer and for those who produce it will promote its growth. 

Updates from 26th July 2022

According to the Office for National Statistics (ONS), job vacancies in the sector now sit at 176,000, double that of before COVID. With the busy upcoming Summer season, this causes a real problem and is impeding the sector's ability to recover from crisis.

The latest UKHospitality report shows that sector operating costs have reached 55.2% of turnover, even before rent is taken into consideration. That's the highest since 2007.