Beer duty freeze but little relief for pubs in Autumn Statement

The most significant elements for licensees were an announcement on rural rates relief, several incentives for small businesses, a freeze in beer duty and the national living wage rise.

A continuation of a freeze in beer duty was welcomed by the Campaign for Real Ale (CAMRA), something which it had called for – but the organisation also called for a cut in April’s Budget next year.

Financial pressure

CAMRA national chairman Colin Valentine said: “Pubs are under a huge amount of financial pressure and, with UK beer drinkers paying 52.2p of duty on their pint, we are seeing more and more people choosing to drink at home rather than at their local.

“This trend not only hurts UK businesses, but is also contributing to the demise of our communities and affects people’s personal wellbeing.

“While a freeze in beer duty is welcome, CAMRA would like to see the Government do more to reverse the damage done by the beer duty escalator by cutting duty in the 2017 Budget.”

One of the big pieces of news for licensees was as employers, with the national living wage rising to £7.50 in April 2017, creating a pay rise of around £600 a year for each member of staff affected.

Rural rates

The one piece of good news was the 100% rates relief for rural businesses – a point raised by British Beer and Pub Association chief executive Brigid Simmonds.

Equalisation of Rural Rate Relief good news for pubs who could only receive SBRR.  Little more help on Transitional Relief #AutumnStatement

— Brigid Simmonds BBPA (@BrigidSimmonds) November 23, 2016

But Greg Mulholland, the chair of the Parliamentary Save the Pub Group, said there was little change for business rates overall – and more needed to be done.

No real change on #businessrates, #pubs paying too high a proportion nationally & this must be changed. #AutumnStatement

— The Pub Champion (@ThePubChampion) November 23, 2016

This was a view shared by the Association of Licensed Multiple Retailers chief executive Kate Nicholls, who said: “The lowering of transitional relief caps and the increase in rural relief is welcome, but this still falls far short of the wholesale change that many businesses are looking for and that some will need in order to invest and grow.

“The Government has indicated that further announcements on rates are to be made by the DCLG (Department for Communities and Local Government) and we hope that this will provide better news and a more productive step towards tackling rates bills that are a serious difficulty for many businesses."

Living wage rise

On the issue of the rise in the national living wage, Nicholls said this was lower than forecast, but "will still tighten margins for businesses and some will struggle to afford it".

She said: “If wage rates are to be affordable and equitable, the Government must step away from a policy-driven rate and ensure that any increases are independently set by the Low Pay Commission, reflecting the economic landscape.”

Simmonds also pointed out that pubs are paying 2.8% of total rates to the exchequer – equating to 0.5% of turnover.

Other plans, which could impact small businesses such as pubs, include 100% capital allowances on electric charging for cars, which could be placed in pub car parks.