Third duty cut will grow brewing sector says SIBA

Ahead of next week’s budget SIBA has released preliminary figures from its survey British Beer 2015 released next week that shows production by SIBA members grew by c.15.8% in 2014 to 2.99 million hectolitres or 526 million pints. In 2013 the increase was 9.4%, which together results in a 25% uplift in sales since the Beer Duty Escalator was abolished in March 2013.

Before the duty cuts production only grew by 5.7% in 2011-2012.

Positive impact of duty cuts​

SIBA managing director Mike Benner said: “The results of the survey clearly demonstrate how the two consecutive cuts in beer duty and end of the Beer Duty Escalator have had a positive impact on independent British brewing and have boosted confidence. Our members have invested the duty savings in their businesses, buying new brewing equipment, increasing production and recruiting new staff.

“By announcing a third cut in beer duty in next week’s Budget, the Government can ensure that the momentum of the previous cuts is maintained and the independent brewing sector, now recovering and starting to thrive after years of unfair taxation, continues to grow, bringing jobs and investment to hundreds of local economies around the country.”

SIBA estimates that 1,600 jobs at independent breweries during 2013 and 2014 and the majority of brewers plan to recruit over the next 12 months, with 83% of them planning to create one or more jobs, and 38% planning two or more new jobs which could result in around 840 new jobs.

Breweries are also committed to training, with 77% planning to invest in this area.

Brewery investment​

The majority of SIBA members invested in their breweries last year, with 12% spending more than £100,000. New brewing equipment, new premises and staff recruitment were the most popular investments by members during 2014, and are indicators of their future growth ambitions: 85% plan to increase their production and annual turnover in the next three years with around 20% hoping to double their current levels.

The survey includes responses from 270 SIBA brewers and was written by Dr Ignazio Cabras, a leading economist with an interest in beer, based at Newcastle Business School at the University of Northumbria.