Exclusive Q&A with pubs minister Jake Berry

Q. What’s the biggest issue for you as pubs minister?

Jake Berry (JB) – When you go to pubs around the country, the biggest issues they face are twofold. Firstly, the continued change in people’s drinking habits. That is a structural issue and pubs need to find their place in our new drinking habits. That’s why Pub is the Hub (PITH) is fantastic because it’s about putting the pub at the heart of the community, like you see here at the Woolpack in Haslingden, Lancashire. It’s when you have the brass band coming to rehearse, you raise money for local charities, that’s how you get people through the door. It’s a great place to meet and socialise – pubs are, of course, the original social network – and we need to peel people away from Facebook and that sort of thing to get them having real conversations in a pub.

And secondly, they talk about the challenges around the increasing expense of running a pub. So there’s an issue around wages going up, increased input costs more generally. But I’d say the biggest single thing they identify is business rates.

Q. Do you think business rates should be reformed?

JB – With business rates, the Government has taken quite a lot of steps already. We’ve doubled the small business rate relief. We’ve increased the value to £51,000 before the multiplier starts applying, and every pub with a rateable value under £100,000 gets £1,000 rate reduction. In addition, we are moving from Retail Price Index to Consumer Price Index.

All of that is expensive. It’s been a big commitment by the Government but I think the challenges business rates present more generally, not just for pubs, is acknowledged.

We’ve been clear that there’s a desire to review business rates, but it has to be as part of a wider taxation review because there has to be a replacement of that taxation revenue from somewhere else. I’m encouraged by the start the Government made looking at forms of online taxation, which some people call the ‘Amazon tax’. The Government is looking at the way the economy has changed and the way in which we can get this great, exciting opportunity and how that can be taxed in a reasonable and fair way.

It has to be an international effort to find out how we can tax that digital economy because of the nature of digital businesses, which can relocate [across national borders] really quickly. But that will provide the freedom to have a review and look at business rates in line with our manifesto commitment.

Q. Have you spoken to your colleagues in the Treasury about this and could we see some good news for pubs in the Budget later this year?

JB – It would be a surprise if I sought to pre-judge what may come out in the Budget. Ultimately, it is a matter for the Treasury and you haven’t got too long to wait.

Q. What would you like to see?

JB – I know my Treasury colleagues acknowledge the huge contribution pubs make to our community and that can be seen already from the reduction and, most recently, the freezing of beer duty and other duties. I’d like to see a cross-Governmental commitment to supporting the pub industry.

Q. When pubs have seen business rates double, or even triple in some cases, then they wish to appeal those through the Valuation Office Agency (VOA), that’s been criticised as a slow process. Should it be streamlined or accelerated in some way?

JB – The VOA has been too slow and they should be looking to address that. If the Government needs to act in this space, I think it’s something we should consider. My own experience as a constituency MP on behalf of pubs that have gone down the route of challenges is that it has become a very, very slow process. This is something that the VOA, which is largely independent of Government, should look at and react to because the uncertainty is bad for business and bad for pubs.

Q. What would you like to see happen with beer duty in the Budget?

JB – Over recent years, pubs and breweries have told me that when the Government either freezes or cuts beer duties, it’s a huge support for the pub industry and a big supporter of our wider economy.

I hope that as the Treasury is preparing the Budget, it will keep those wider economic benefits the pub and brewing industry bring in mind and look at the demonstrable benefits it has brought in previous budgets where it has either frozen or decreased beer duty.

Q. Should VAT be reduced for pubs?

JB – VAT is not, currently, largely within the Government’s control. It’s a matter we need to seek European permission for.

When we leave the EU, as we’re doing on 29 March next year, the Government will have much more freedom to look at things like our VAT rates and the levels of tax. That would be the appropriate time to look at whether a reduction, not just for pubs but more for widely the leisure industry, is something that would have demonstrable benefits for our economy.

Q. The pubs code is not strictly your remit, it is the responsibility of minister Richard Harrington, but as the pubs minister do you think the pubs code is working? Does it need to be reformed?

JB – I’m in contact with Richard about this – the decision about reform or not is, ultimately, his. We need to keep this under review, it’s still relatively new in terms of its application.

But what we should be clear about is that if it is not working, the Government will not be afraid to take any necessary action to ensure that we achieve the aims of the pubs code.

What any business hates, be it a pub or Jaguar Land Rover, is periods of uncertainty. If there is strong evidence coming forward that the delays are a big part of the problem, I hope that is something that Richard would take up.

And if the pubs code isn’t working – I’m not saying it is not working – then it is certain the Government should act again to deliver on the objectives.