Deaf... And dumb

More pubs to close, supermarkets to continue cheap booze offers, inflation-busting duty rises for years - a disaster says the trade

The PMA Team

paul.charity@william-reed.co.uk

Chancellor Alistair Darling ignored trade pleas for a duty freeze on Wednesday and forced up the price of beer for drinkers by 12p to 15p a pint.

The swingeing 4p rise in duty on a pint of beer - a 13% increase - comes after recent wholesaler increases. It means the retail price of a pint is now 25p more than it was a month ago.

The Campaign for Real Ale (Camra) described the move as a "great big nail whacked ruthlessly in the coffin of the British pub".

Darling also pledged to raise duty on alcohol by 2% above inflation for the next four years. This year, Darling has increased alcohol duty by 6% above the rate of inflation.

Mike Benner, chief executive of Camra, said: "The Chancellor has failed to

recognise that well-run community pubs are the solution to Britain's binge drinking problems.

"This budget will do nothing to stop binge drinking, but it will lead to pub closures on a huge scale, widen the gap between supermarket and pub prices and encourage smuggling and cross-border shopping.

Cider is also up by 3p a litre, which equates to 2p a pint, duty on a bottle of wine will increase by 14p, and 55p will be added to bottles of spirits. Darling said that the rise was justified because the average price of a bottle of supermarket wine had dropped since 1997 from £4.45 to £4.

Rob Hayward, British Beer & Pub Association (BBPA) chief executive, said: "Alistair Darling has just launched the £6.50 pint in time for the London Olympics. This will escalate pub closures, which are already at record levels

"Government is punishing all beer drinkers rather than tackling the minority of drunken hooligans. But Government policy is fuelling Britain's binge drink problem by driving people away from beer, out of the pub, and into the arms of the deep discounting supermarkets.

"They don't pay beer duty and don't allow brewers to pass it on, so their rock bottom prices will remain unaffected by this tax hike."

He added: "The millions of people who enjoy beer have just been hit by a £50.5m a month tax raid on their family budgets.

"By aiming a tax hike at beer, the Chancellor is shooting himself in the foot. Treasury revenues will continue to fall, pubs will continue to close and beer sales sink further."

Paul Smith, executive director of Noctis, said: "It will make absolutely no odds to the supermarkets as they can afford to take the increases on board and continue to sell below cost."

Derek Andrew, head of Marston's managed division, said: "The tactical missiles have been put away and Bomber Harris has come out again.

"This is just going to accelerate the decline of supervised drinking premises. It is absolutely unbelievable."

He described the move as an act of duplicity. Government ministers listened to the arguments of the trade in private meetings and then "binned the targeted approach".

Tim Martin, founder of JD Wetherspoon, said: "I'm in shock at the level of the rise. It's a great, great shame.

"I think it was absolutely inevitable that by concentrating on price we were going to end up with a duty increase for the pub trade. The trade has entirely got itself to blame. The logic of this flowed inexorably from blaming binge-drinking on the price of drink. The only way for Government to react was to up duty."

"It has responded to low prices in supermarkets in the only way it could. It will hardly affect supermarkets at all. Duty is a low percentage of their costs - it's a much higher percentage of ours."

Siba said: "Darling is driving more and more people out of pubs."

licensee outrage

John Ellis of the Crown Inn, a freehold wet-only pub in Oakengates, Shropshire, said: "It's a budget aimed at binge drinkers. All he could talk about was the price of wine in supermarkets - they're going to punish responsible drinkers. Supermarkets will continue to sell at below cost price despite this measure. It's the on-trade, which provides a safe and responsible drinking atmosphere, that's going to be hit. Every facet of the trade needs to come together and fight or this is the beginning of the end for the British pub."

Steve Haslam, of the Cutter Inn, Ely, Cambridgeshire, an Enterprise Inns tenancy, said: "I'm stunned, we've been hit again and they've given us nothing. The fact that this comes hot on the heels of a rise of 4% from suppliers is simply beyond the pale. Plus food inflation, rising rents, massive increases in utility costs, the smoking ban and minimum wage increases - it's RIP independent pub retailers. The Government looks at this industry as a place to increase taxes to pay for other spending. The cost of living is going up, the tax burden is at its highest level ever - after work you go to the pub to relax and you may as well be ordering a pint of tax."