Beer Duty

Lord Spellar Excerpts

Tuesday 7th March 2017 Westminster Hall

[Steve Double]

My hon. Friend is absolutely right. Whereas many other industries are centralised in very specific areas or regions of our country, the pub industry is spread right across it and provides much needed jobs in many of the more rural areas. He is also right that we need to reduce the gap between the duty we pay in this country and the duty paid in many other countries, and I will come on to that later.

[Mr John Spellar (Warley) (Lab)]

The hon. Gentleman rightly identifies the role of rural pubs, many of which serve those who come out to the countryside from our conurbations. What impact does he think the ill-thought-out proposals from the Local Government Association to cut the number from 2 pints or 1.5 pints to 1 pint will have on those pubs?

[Steve Double]

I assume the right hon. Gentleman is talking about the guidelines for alcohol consumption. I suspect that is a subject for another day, but I understand his point.

[Mr Spellar]

No, I am not talking about the guidelines; I am talking about the drink-drive limit. Most of the offences are recorded at the much higher level of about 150 mg. A reduction in the limit could have a dramatic effect on many rural pubs, let alone rugby clubs, Royal British Legion clubs and so on.

[Steve Double]

I now understand the point the right hon. Gentleman is making. I would never drink and drive at all. That attitude has become much more the norm in today’s society, where most people consider that drinking anything and driving should be avoided. I am not entirely sure that I agree with his point.

The brewing and pub industry not only employs 900,000 people but attracts many younger people to its workforce—in fact, 46% of those employed in the sector are under 25 years old. That level of employment among the young is a critical factor, especially in rural constituencies such as the one I represent in Cornwall. While many start out in basic roles, they go on to become professionals in the trade or elsewhere—for example, working as chefs, licensees or successful businesspeople in their own right, and employing others.

That said, the news has not always been good in recent times. Some 17,000 pubs have closed in the past three decades, and while the closure trend has slowed markedly of late, many communities will grieve the loss of their local, which all too often is the only pub in the area.

--- Later in debate ---

[Steve Double]

My hon. Friend may have been reading my notes, because that is a point I will come on to highlight.

There are many reasons why pubs have closed. Some of them were badly managed, and some lacked investment to keep the facilities up to date. Although I believe that the smoking ban was the right thing to do, and it is popular among many pub goers, we have to acknowledge that it stopped smokers visiting the pub quite so often. There are also changing social habits, with more people drinking at home as a result of cheap alcohol available in supermarkets and other outlets.

Those factors have all contributed, but it is also undeniable that the dreadful and despised beer duty escalator introduced in 2008 had a devastating effect on the industry. Annual duty rises under the escalator led to beer duties rising to among some of the highest anywhere. Even now, following successive years of duty reduction by this Conservative Government, our pints remain heavily taxed at around 52p on a 5% alcohol by volume pint, compared with 4p in other key beer-brewing nations such as Germany and Spain—an enormous and disproportionate difference that needs to be addressed.

There is much more happening now, with a revolution in the old craft of brewing and selling beer to the UK’s 32 million beer drinkers. Numerous microbreweries have opened up and craft beer and real ale are rising in popularity. I have the great privilege of having a great example of a local family-run brewery in my constituency. St Austell Brewery has been a roaring success in recent years, particularly since the launch of its excellent Tribute ale. It now makes many excellent beers, and I spent an enjoyable day during the recent recess assisting master brewer Roger Ryman in making a batch of Proper Job. I count the fact that I managed to make more than I drank that day as a notable success.

While it is right to recognise concerns about alcohol abuse, we must note that the majority of people enjoy healthy levels of drinking. Given the social benefits that come with a visit to the local pub, it makes no more sense to celebrate pub closures than it does to close roads because some motorists speed.

[Mr Spellar]

On the subject of craft breweries, will the hon. Gentleman, who rightly attacks the beer duty escalator, acknowledge the very considerable role played by the duty exemption for small breweries that are getting off the ground? That was a major factor in the explosion of the craft brewery business and was introduced by my right hon. Friend the Member for Wentworth and Dearne (John Healey) when he was at the Treasury.

[Steve Double]

I will happily agree. The support given to microbreweries to develop right across the country—they are now producing very high-quality, excellent craft beer—is a success that should be noted.