Beer Duty Escalator

Guto Bebb Excerpts

Thursday 1st November 2012 Commons Chamber

[Bob Blackman]

Indeed. Pubs in my constituency have been closed down and redeveloped as flats. The loss of those extremely valuable centres results in the destruction of the whole community.

Beer has a relatively low alcohol content. Those who promote the beer duty escalator talk about the health risks related to drinking, but I am a great supporter of responsible drinking and of transferring people to beer drinking, given its relatively low alcohol content. A person would almost have to drink more beer than their capacity would allow in order to damage their health, whereas relatively small quantities of spirits can cause immense damage.

The supermarkets have not only helped to destroy local pubs; they have completely eliminated off-sales from other environments. Anyone can wander into a relatively small supermarket in my constituency today and buy six cans of beer for a fiver, but if they go across the road to the local pub, The Duck in the Pond, they will have to pay £3 for a pint. Why would anyone do anything other than buy beer from the supermarket and wander off home, or drink it on the street? This is causing real damage to the people who are providing these important facilities.

Some people call for minimum unit pricing for alcohol, and I can understand why they do so. I believe that there are huge risks involved in minimum pricing, but we have to address the supermarkets’ predatory pricing and prevent them from subsidising alcohol sales. We need to ensure that they compete fairly with local pubs, rather than ruthlessly getting customers by selling alcohol as a loss leader.

The Treasury’s own figures show that the beer duty escalator will produce only a flat level of income. If that is the case, and if the duty is going to increase year on year, that can only mean that the Treasury is forecasting reduced volumes of beer sales in this country. That can only mean more threats to our pubs and our communities, and there will be implications for other forms of alcohol as well.

[Guto Bebb (Aberconwy) (Con)]

I have three breweries in my constituency—Bragdy’r Nant, Bragdy’r Gogarth and Bragdy Conwy—and for those slow on the uptake, Bragdy is Welsh for brewery. Those businesses are paying about 50% of their turnover in tax. They recently invested in a pub in the local community, but they will not be able to do that again because so much of their turnover currently goes in tax.

[Bob Blackman]

Indeed, and the potential of local pubs to contribute to growth in the economy is threatened by the beer duty escalator.

There is an alternative. If we abolish the beer duty escalator, promote the responsible drinking of beer, as my hon. Friend the Member for Leeds North West (Greg Mulholland) mentioned, and allow the price of a pint at the pump to be reduced, that will help people to move away from irresponsible supermarket drinking back into pubs. That would mean they consumed less over a longer period and in a more sociable atmosphere, while the Treasury would get more income as those sales increased. We would therefore see a better outcome—for health, for pubs and for the Exchequer—making this a win all round. I thus urge our new Minister to have a full and proper review of how to reduce the price at the pump and dissuade the supermarkets from cross-subsidising their sales, leading to much better social interaction in our society and encouraging pubs to grow, and make sure that it continues.

My final point relates to the growth of small pubs in areas where they are taking over empty shops. I think this is a potentially serious problem, when large groups of relatively small pubs become a threat to the local environment and to local communities. It is a threat to the big traditional pubs, which have served this country so well over many years, particularly in the suburban and urban areas. Landlords of these new pubs often do not have the same sense of responsibility as the previous landlords. We need to look at the impact of that and understand why this it is happening. I look to Ministers to review the situation so that everyone can see the benefits of the great British pub and, indeed, of all the social centres that we have discussed in the debate. We must ensure a fair and reasonable deal for pubs—from the Exchequer and in competition with supermarkets.