Cider Industry: Duty Changes

Debate between Dan Poulter and Helen Whately

Wednesday 1st December 2021 Westminster Hall

[The Exchequer Secretary to the Treasury (Helen Whately)]

It is a pleasure to serve under your chairmanship, Mr Davies. I raise a metaphorical glass to congratulate my hon. Friend the Member for North Herefordshire (Bill Wiggin) on securing this debate, and I thank him for his constructive tone and his welcome for many of the announcements on alcohol duty in the Budget.

It is clear that my hon. Friend is indeed a true friend of the many cider producers in his constituency. I know that this is an industry with a long history in Herefordshire. In fact, as far back as 1724, Daniel Defoe wrote of the county’s people that

“they have the finest wool, and the best hops and richest cider in all Britain.”

As a Kent MP, I know that other parts of the country might dispute that claim, at least when it comes to hops. Today, as my hon. Friend pointed out, Herefordshire is home to many cider makers, small and large, producing drinks that are enjoyed both in this country and around the world. Although Herefordshire is a centre for the industry, the economic benefits of cider production are felt nationwide.

My hon. Friend is quite right to highlight cider producers’ contribution to the national economy and the many jobs that the industry supports. I am sure hon. Members can understand why the Government want this fantastic industry, which has been with us since at least Roman times, to go on to even bigger and better things.

Before I address the detailed points raised by my hon. Friend, I will briefly run through some of the changes we are making, which we believe will help the industry to go on to achieve further success. First, I will discuss alcohol duty reform. Quite frankly, reform of our alcohol tax laws is long overdue. They have barely changed since the 1990s. As my hon. Friend said, that is largely because of incoherent and prohibitive European Union rules that have hindered much-needed change. However, now we have left the EU, we have an unmissable opportunity to create alcohol laws that are simpler, fairer and indeed healthier, and by doing so we can help cider producers—along with British brewers, wine producers and spirit makers—to innovate and grow. That is why in the Budget we announced a series of major reforms to our alcohol duty laws, including the biggest reduction in cider duty for 98 years. Our new draft relief will cut duty on draft cider by 5%, encouraging people to choose to purchase cider in our great British pubs.

We look forward to working with the industry to understand how keg size and distribution methods can best support small producers and cider makers. We are also cutting duty on craft sparkling cider by up to half, so that anyone buying a 75 cl bottle of such cider that is 6.5% alcohol by volume will pay £1.25 less duty. This boost is a clear benefit of the Government’s decision to introduce a common-sense approach to alcohol duty and to remove the arbitrary and unfair premium rates on sparkling ciders and wines in the current system.

The new lower duty rates for ciders below 3.5% alcohol by volume will incentivise cider producers to innovate and develop healthier alternatives for consumers. As the Chancellor said at the Budget, sales of fruit cider have increased from one in 1,000 ciders sold in 2005 to one in four sold today. As has been mentioned, we are also cutting duty on such drinks by 13p a pint in the pub.

My hon. Friend the Member for North Herefordshire was right to highlight the health risks of white ciders. Although we are reducing the cost of lower-strength ciders, we are increasing duty on high-strength drinks, including harmful white ciders. Under our reforms, people buying superstrength ciders will pay 7p per 500 ml can. We believe that, together, such measures will not only boost British craft cider producers, but give consumers more choice, with healthier, lower-alcohol alternatives. They will boost community pubs by incentivising people to drink at their local instead of at home.

Beyond the duty changes, we are supporting the traditional cider industry in other ways. Although we are listening closely to the industry as part of our consultation on changing minimum duty requirements, we are keeping the definition of “cider” as a drink made wholly from apples and pears. My hon. Friend pointed out that we need to champion the little guy, and I agree. That is why all the measures will be underpinned by a new small producer relief for businesses making cider that is less than 8.5% alcohol by volume. That will build on the duty exemption that the smallest cider makers currently enjoy and help smaller, innovative craft cider makers and other producers, such as those found in Herefordshire and Somerset, to expand and grow their businesses without facing substantial tax increases.

On consultation, I want to stress that the reforms announced at the Budget were part of our review on alcohol duty last year. That involved a call for evidence and received over 100 responses from the industry and other groups. We spent almost a year carefully considering the feedback from cider makers and other producers. We have been closely discussing our proposals with the industry throughout the policy development process. The consultation will be published in October and remains open until January, and I welcome the industry’s views on the questions raised in the consultation documents and on the points covered by my hon. Friend during the debate.

I take on board my hon. Friend’s point about the difference in duties between flavoured and non-flavoured ciders. We believe that maintaining this difference helps to safeguard traditional cider’s valuable contribution to local heritage and agriculture. As I said a moment ago, there is also the small producers relief, which is a very important support for our smaller cider makers.

I recognise that the changes outlined at the Budget are significant, and we will continue to listen to the sector. I have heard the arguments that my hon. Friend has made, and I look forward to working with him and other colleagues on this matter.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

In the context of promoting high-quality cider in the spirt of this commendable debate, which was secured by my hon. Friend the Member for North Herefordshire (Bill Wiggin), would the Minister look at minimum unit pricing for drinks from a healthcare perspective? That would actually clear out and stop the production of dangerous white ciders, which are part of the problem that feeds alcoholism and alcohol dependence in this country. Would she take that suggestion away and look at it?

[Helen Whately]

I thank my hon. Friend for that point. I hate to pass the buck, but the question he asks about minimum pricing in shops and supermarkets—I was asked about this issue in correspondence recently—is a Home Office matter. From a Treasury point of view, and as he will have seen from the policies that I have been describing, our reforms to the alcohol duty system take a public health approach to changing the current system, in which higher-strength drinks sometimes enjoy a lower duty. We are moving to a system whereby higher-strength drinks will pay more duty, encouraging the production and, relatively, the consumption of lower-strength drinks, and therefore healthier options.

In conclusion, once-in-a-generation duty cuts, new incentives to grow and innovate, and a boost for pubs—our reforms spell exciting times for cider in this country. These steps will not only put more money in people’s pockets, but encourage people to try new healthier and, may I say, delicious drinking choices. I am confident that together these measures will support our wonderful, traditional cider industry for many more years to come.

Question put and agreed to.

Residents of Leisure Park Homes

Debate between Dan Poulter and Helen Whately

Wednesday 27th February 2019 Westminster Hall

[Helen Whately]

In general, we should look at what is happening in all parts of the United Kingdom to see what works best, and learn from it. I will refer to Wales in a moment, and no doubt the Minister will do the same.

I have already had conversations with the Minister on the issue. She is sympathetic and concerned, and is very much looking into it, which I appreciate. My first questions are whether she will consider extending the relevant parts of the 2013 Act to holiday home owners; whether she will consider introducing tougher penalties for unscrupulous holiday site owners to discourage them from acting in an exploitative way; and whether she will look at the fit and proper person test, which could be introduced in England for residential homes under the Act, and has already been introduced in Wales. Although the test is not perfect, it would be a step in the right direction, and would make it harder for a known unscrupulous landlord to get a site licence.

As well as introducing stronger rights and protections for the purchasers of holiday homes, we need to make sure that existing legislation is enforced. My understanding is that in England, the responsibility falls on local councils; the local council, for instance, should check that holiday home owners have another primary address, so that their holiday home is not their only and main address, and should also ensure that holiday home owners are not staying in their holiday home all year round.

It appears, at least in Maidstone in the case of Pilgrims Retreat, that my local borough council has not been doing those things, so the situation has been allowed to continue, not just for months but for years. It has built up, so that tens, indeed potentially hundreds, of people who believe they are residents are affected, even though the same local authority has been collecting council tax from these individuals, as if they were permanent residents.

The site licence at Pilgrims Retreat has been extended from 11 months to 12 months, which compounds the confusion of individuals seeking to buy properties there and live in them by giving them the impression that they can stay in these places all year round. I do not believe that my local council is alone in doing that.

Given the situation and the various ways in which individuals at Pilgrims Retreat have been let down, I welcome the fact that my local council is considering an amnesty for them and is trying to find ways to avoid making the residents—as they believe they are—homeless, because these properties are their only residence, and they have spent their savings on them; but in general, the situation should not and must not be allowed to continue.

If borough councils across the country are really struggling and failing to enforce the rules, it would be right to look at other options for licensing and enforcement. I ask the Minister to consider what could make enforcement work better. What changes to the rules might make enforcement easier? Should there be other organisations involved, or other levels at which enforcement and licensing occur, perhaps at county level? Or should there be an independent regulator with statutory enforcement powers?

To make things easier, perhaps there should also be a change to the rules. When a site has a 12-month licence, people might be told that they cannot stay there all year round, but it is really hard to enforce that rule. It would be easier if a site simply closed for a period of the year, for one or two months. That would not necessarily be popular with the holiday park owners, who are trying to run a business in which people might want to take a holiday at any time of the year, but there is a balance to be struck between making sure that the business model works, and making sure that these properties are holiday homes, because if they become de facto housing developments, they are totally failing to achieve their objective for the economy.

We need stronger protections for the individuals who live in these homes, and need to make sure that any new protections are properly enforced. We need to make sure that consumers know their rights. I have spoken to the British Holiday & Home Parks Association and listened to stories from all around the country, and it seems to be clear that many people are not alert to the risk of being mis-sold a holiday home. They hear that residents pay council tax; they know about 12-month leases; and often the site owners are the only source of information and advice for somebody planning a purchase, up to and including the point of sale. Many purchasers genuinely believe that they are buying a residential home.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

My hon. Friend is making some good points. On the issue of advice, is there not a potential role for solicitors in providing advice about the transactions involved? We are not talking about inconsiderable sums of money; sometimes we are talking about a lot of money for the individuals who are buying these park homes. What role does she feel that solicitors and the legal process should have in helping people to make wise decisions and understand the risks involved?

[Helen Whately]

I thank my hon. Friend for making that point, which is similar to one that was made earlier. When individuals are spending these sums of money—£100,000 or £200,000—perhaps they should be required to get some form of legal advice; it would be right to consider that. Clearly, we do not want to make the process more onerous than the process of buying a home, but one cannot buy a bricks-and-mortar house without going through a conveyancing process. Perhaps if there was a requirement for some kind of more formal process, fewer people would fall into the trap of misunderstanding what they are buying.

There is also a role for communication. Perhaps there is an opportunity for a communications campaign targeted at this market—at potential and current holiday park home owners—so that we get the message to people who might well become victims of this situation. We need to address the mismatch between people’s perceptions and the reality of buying a holiday park home. People need to understand that they are not buying the land; they are buying a lease. They need to know the implications of that.

Looking around, I believe that there are colleagues who may wish to speak, and I am very keen to make sure that my hon. Friend the Minister has time to answer my questions, so I will conclude by saying that by strengthening legislation to give protections to holiday park home owners, by ensuring proper enforcement, and by improving consumer awareness, we can and must make sure that other people do not fall into the same trap that my constituents at Pilgrims Retreat did.