Chancellor of the Exchequer Rishi Sunak failed to help community 'wet led' pubs in a gernerally welcomed package to stimulate the hospitality industry's recovery from the pandemic lockdown.
VAT has been slashed from 20 to 5 per cent across food, accommodation and attractions for six months. And there will also be voucher scheme to encourage people to eat out in August. “To support restaurants and the people who work in them, we’re saying ‘Eat Out to Help Out’,” the Chancellor announced in his initiatives for the sector. "For the month of August we’ll give you a 50% reduction, up to £10 per head, on sit-down meals and non-alcoholic drinks, Monday to Wednesday,”
These initiatives will benefit gastro and food-led chain pubs. But the teetotal Chancellor ignored the plight of both independent brewers and community hub pubs, whose lifeblood is drinks sales. Trade bodies have strongly criticised the omission as a deep flaw in the package.At Beer Tours UK we visit and support many of these pubs. Here we take a look at the reactions to the Chancellor's announcements.
Tom Stainer, chief executive of the Campaign for Real Ale (CAMRA), said: “While a six-month cut in VAT for food served in pubs and the Eat Out to Help Out voucher scheme in August is welcomed, we are concerned that pubs have been left behind by the Chancellor’s statement, which contained little support for community pubs.
"It is also disappointing to see no direct support for independent brewers and producers, who will not benefit from a VAT cut that specifically excludes beer and cider. CAMRA will continue to campaign for greater support for all pubs, including those that don’t serve food. We are calling for long-term support measures — business rate reform and a tax reduction for draught beer — to encourage people back to the supervised setting of the community pub.
“Lockdown has shown just how valuable our pubs are to local communities and the pivotal role they play in tackling loneliness and social isolation. It is absolutely right that they receive extra support during the difficult months ahead to ensure their continued survival.”
‘The pub and brewing sector needs to be thriving, not just surviving’
The British Beer & Pub Association welcomed Rishi Sunak’s package as a helpful first step on a long road to recovery, especially for food-led pubs and those with accommodation.However, it says that further support will be required to help the thousands of community pubs and breweries get back on their feet.
The association also welcomed the announcement of the kickstart job scheme, for young people aged between 16 and 24 on Universal Credit, subsidising the costs of work placements for them in businesses. Pubs already directly employ 600,000 people and 43 per cent of them are under 25, making them a vital source of jobs for young people.
Chief executive, Emma McClarkin, said: “The pub and brewing sector has huge potential to create thousands of new jobs and employ more people, but to do this it needs to be thriving, not just surviving. This will require more support in the medium term, directed at all pubs and brewers so they can help lead with the economic recovery. These measures include a significant cut to beer duty to bring the UK in line with other European countries who pay far less tax on beer, and a fundamental review of the business rates system so that pubs no longer pay an unfair share of them.
James Calder. chief executive of the Society of Independent Brewers (SIBA), said: “The job retention bonus and kick start scheme will help beer, brewing, and pubs, given we employ a disproportionate number of young people. The temporary VAT cut to 5% and Eat Out to Help Out scheme will help encourage people back into the pub.
“But we’re very disappointed that beer, the UK’s national drink, has been excluded from the VAT cut and the eating out scheme. Today’s announcements do nothing to directly help small, wet-led community pubs and independent craft breweries.”
He added: “Given the Covid earthquake that has hit the brewing industry, we need a tax system that does what the Chancellor set out to do for the whole economy: to protect jobs and to enable us to bounce back. The only way that can happen is to reduce the overall tax burden, protect the relief for the smallest breweries, and incentivise growth. We look forward to working with the Chancellor on the future of independent brewing in Britain.”
The Government has turned its back on thousands of local community pubs says the Campaign for Pubs, the grass roots campaign to promote, support and protect community pubs. Campaign director Greg Mulholland said: “The Chancellor’s announcement is very mixed news, what was needed was what the Campaign for Pubs have been calling for, a 5% VAT cut for all hospitality. Instead Rishi Sunak has decided to help only pubs that do food and overnight accommodation and has done nothing at all to help thousands of beloved community locals up and down the country, which is unfair.
“The Government appears to be turning its back on the traditional community local, many can’t trade profitably due to Government restrictions and yet are being offered no support by the Government. We urge the Chancellor to think again, or we will see the closures of many valued pubs, including in his own constituency. So we welcome the help for pubs that serve food and offer bed and breakfast, but are dismayed at the lack of any support for all other pubs and we will now be lobbying the Government to help all pubs through the ongoing crisis, not just some of them”.
Dawn Hopkins, vice-chair of the Campaign for Pubs and licensee of the Rose, Norwich (a wet-led pub) said: “There are thousands of community pubs up and down the country who are dismayed at today’s announcement. Wet-led pubs like mine, with restricted and reduced trade due to Government rules, have been given no support from the Government. In truth the Chancellor hasn’t tried to help pubs, he’s just decided to help tourism and whilst that is important, so are pubs in other areas and so is community and today the Chancellor has turned his back on many community locals.