Enterprise Inns raises its beer prices by 3.8 per cent

Enterprise Inns licensees are facing a 3.8 per cent increase on drinks supplied by the pub company.

Letters have been sent to licensees confirming the hike. It follows news of a 3.3 per cent rise by fellow pubco giant Punch Taverns.

David Lalor, licensee of Enterprise Inns-owned pub the Station Inn in Derby, said the rise was "to be expected" with inflation currently at four per cent.

He said: "It is a price increase and there is nothing you can do about it. I will have to look at my prices across the board now."

The price hike for licensees follows VAT being pushed up to 20 per cent in January and precedes an expected two per cent above inflation duty hike at next month's Budget.

Lalor added: "This could be disastrous for the pub industry. All you can do is hope and see what happens.

"I will wait until after the Budget before deciding what to do with my prices."

A spokesman for Enterprise Inns said: "Despite consistent price increases from the brewers (5.5 per cent per annum on average in the last three years), Enterprise Inns has sought to hold the increases we pass on to our licencees for as long as possible. Sadly we are no longer able to absorb these increases fully.

However, the average increase for 2011 of approximately 3.8 per cent is below current Retail Price Index (RPI) inflation of 4.8 per cent (December 2010).

In addition, we have increased the level of discounts available to licensees over this period, to help mitigate the impact of price inflation on their businesses."