Beer Duty Escalator

Julian Sturdy Excerpts

Tuesday 5th March 2013 Westminster Hall

[Mr Jones]

I thank the hon. Lady for her comments. It is nice and extremely refreshing to be able to agree with comments made by an Opposition Member. She has made an extremely pertinent point. Beer is a lower-strength product, and it is far better for people, if consumed in moderation, than higher-strength drinks, which may well be more damaging to health if consumed in excessive quantities.

The increases in duty are having a disproportionate effect, in particular on our pub industry and if we compare on-sales with off-sales, especially off-sales made in supermarkets. Before the escalator was introduced, drinking in a pub was four times more expensive than drinking at home; now, after a few short years, it is eight times more expensive, which shows the disproportionate effect on the great British pub.

[Julian Sturdy (York Outer) (Con)]

I join the chorus of MPs who are congratulating my hon. Friend on securing this important debate. Is there not a real danger—a point he touched on—that we are in an ever-increasing downward spiral? Beer sales are falling and pubs closing; consequently, the revenue to the Treasury is going down. Given that, should not the Treasury focus on the overall tax take and the wider benefits to the economy?

[Mr Jones]

I think that my hon. Friend has probably read my speech; he has made a pertinent point which I completely agree with. Since the escalator was introduced, beer consumption in the UK has fallen by 17% overall and by nearly a quarter in our pubs; almost 6,000 pubs have closed their doors for the last time and more than 60,000 beer-dependent jobs have been lost. As my hon. Friend the Member for Isle of Wight (Mr Turner) mentioned, we are still seeing 18 pubs close per week, which is extremely alarming when we are trying to encourage economic growth and want to get people into work.

I can recount the pubs in my constituency over the past few years that have had to put the towels on for the last time, such as the Fox and Crane, The Graziers Arms or The Boot Inn, not to mention the many social clubs that have also ceased to exist. Notwithstanding the financial benefit of the beer and brewing industry, pub closures are having a detrimental effect on the fabric of our society, due to the high social impact when a pub closes. Our pubs offer a unique leisure experience, are a great addition to the social fabric of our country and are often at the heart of our local communities; they are akin to community centres for their areas. They offer a safe environment in which drinking can be supervised and highly regulated, which is in stark contrast to much of the street drinking and pre-loading culture that has developed since drinking in our pubs has become more expensive.

Pubs are also great places to meet friends and to make new friends. I met my wife in the Chetwynd Arms in my constituency back in 1997. Although 1997 was obviously a dreadful year in many ways—[Hon. Members: “Particularly for your wife.”] Especially for Mrs Jones. The year had one shining light: I met the future Mrs Jones.

Pubs are also a great place to do business. Many small business people such as tradesmen who frequent the local pubs in my constituency often secure new work from going into the local for a pint, by way of word of mouth, with other customers speaking to relatives and so on and so forth.

As my hon. Friend the Member for Burton (Andrew Griffiths) mentioned, local pubs are also a place where many young people get their first taste of work. I had one of my first part-time jobs in my local pub and found it an interesting experience; at the tender age of 16, and very green at the time, I did not realise some of the things that go on in life, although it became absolutely obvious that they do. Not only was it a great learning experience but it taught me how to deal with people. The experience I gained then has stood me in good stead ever since and is extremely important to my work as a Member of Parliament.

Community pubs sustain many positive community activities. Many of our pubs, their licensees and customers contribute towards the funding and running of all sorts of sporting and other activities, such as football, darts, dominoes and cribbage. I could go on with a long list, but a large number of community activities are run because of our pubs. Also, pub customers are extremely generous people; they contribute financially to charities to the tune of £120 million each and every year.

I have set out why our beer and pub industry is so important economically and socially. Finally, I want to start on the road of appealing to the Minister. He is a listening Minister and takes the concerns of Back-Bench Members of this House extremely seriously. I appreciate entirely the Government’s work in reducing the deficit, which has given us far lower interest rates, helping the whole economy and in particular those people who want to frequent our pubs. I appreciate the freeze on council tax for the past three years, which has helped with the cost of living, and the freeze on fuel duty, which has no doubt helped the beer and pub industry because when the fuel duty goes up the price of a pint goes up. I appreciate the other measures that the Minister and his colleagues are taking to reinvigorate the economy as well, but I also urge my hon. Friend to assess the beer duty escalator and beer duty in general to see if the effect is disproportionate. I and many of the industry bodies believe that the negative effect on the industry is disproportionate. Furthermore, as he knows, estimates from the Office for Budget Responsibility expect £100 million less from beer and cider duty in 2013-14, despite the proposed 5.1% duty increase.

My hon. Friend the Minister and my right hon. Friend the Chancellor want to build on the 1 million private sector jobs created under this Government and to keep the momentum. They do not want to see jobs lost unnecessarily as a result of the planned beer duty increase, but the British Beer and Pub Association, as I know from speaking to it, estimates that up to 10,000 jobs could be lost in the industry if something is not done about the tax on beer and the escalator.

I ask the Minister to give our great British beer and pub industry a break by urging the Chancellor to scrap the beer duty escalator and not to increase beer duty this year. If the Chancellor makes the right decision and backs our British pubs, we will hear the clinking of glasses throughout the country on the night of the Budget, and he will be cheered in every pub in the land.