Beer industry job loss fears heightened after summer sales slump

By Gary Scattergood

- Last updated on GMT

Related tags Beer

British beer sales have gone flat - despite the Olympics and European football championships
British beer sales have gone flat - despite the Olympics and European football championships
Beer sales slumped in both pubs and off-trade sales in the last quarter, heightening fears that 5,000 jobs could be lost in the beer industry as the result of “government tax policy”.

Pub sales were down 4.8% on the third quarter of 2012, with off-trade sales dropping 6.5%, despite the European football championships and the Olympics – events which would traditionally see sales soar.

The British Beer and Pub Association (BPPA), which released the figures in its quarterly Beer Barometer, said it meant drinkers supped 117M fewer pints compared with the same period last year.

The BPPA said the reduction in sales was hitting government revenues as well as jobs. It highlighted analysis from Oxford Economics which indicated that a duty freeze in March 2013 would save 5,000 jobs in the sector, which employs almost 1M people – mostly younger people in Britain’s pubs.

Beer duty was increased by 5% in the March 2012 budget, bringing the total increase in beer duty since March 2008 to 42%, said the BBPA.

Beer tax ‘escalator’

Furthermore, the government’s controversial beer tax ‘escalator’ policy meant increases of 2% above inflation until 2014/15.

Brigid Simmonds, chief executive of the BBPA, said beer sales supported around 1M jobs and generated nearly £8bn in tax revenues.

“If the government wants to encourage growth, back British business and support local communities, then it must end the beer duty escalator,”​ she said.

“The chancellor must listen to the thousands of people now calling for a change, so the sector can grow, create jobs and contribute more to UK plc.”

The fight for a change in tax policy received a boost this week when MPs who champion the sector secured a full parliamentary debate on the impact of the escalator. That followed a petition signed by more than 100,000 people calling for government action on the issue.

Impacting jobs

The debate will take place on November 1 after the Backbench Business Committee granted a three-hour slot to discuss how the escalator is impacting on jobs and economic growth.

MPs will then be asked to vote on a motion which will call on the Treasury to launch a detailed review of the policy.

Simmonds added: “I welcome this decision. Many MPs are listening to the public on this issue. This is about consumers – pub goers, beer drinkers and licensees who hate this tax which hits everyone hard.

“The task now is to persuade the government that excessive tax hikes is the wrong policy, which is hurting jobs and pubs.”

Brewers and the Campaign for Real Ale welcomed the announcement of the debate.

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