Beer Duty Escalator

Stephen Gilbert Excerpts

Thursday 1st November 2012 Commons Chamber

[Stephen Gilbert (St Austell and Newquay) (LD)]

I am grateful to have been called to speak in this timely and important debate. I pay tribute to my hon. Friend the Member for Burton (Andrew Griffiths) for his work on this issue, and to my Liberal Democrat colleague, my hon. Friend the Member for Leeds North West (Greg Mulholland), for the work that he does with the all-party save the pub group. I also thank the Backbench Business Committee for responding to the legitimate calls from the public for the House to debate this topic.

I share the concerns expressed by other Members about the inevitable effect of the beer duty escalator, and I join them in calling for a review. Without a review, I fear many more pubs in my beautiful constituency might close, leading to job losses, mostly among younger people. The loss of these important institutions in our communities might also lead to cultural decline.

The pub is a gathering place for the local community. As has been said, it is the equivalent of this Chamber out there in the country, where debates are held every day. It is a place where people can gather to drink safely and responsibly. Speaking for my constituency, the pub is also part of Cornwall’s legendary charm. Many Members will have been to Cornwall and walked down the narrow streets and sat inside the solid granite walls of our local pubs, rich in history, legend and atmosphere. We need these pubs to survive to keep Cornwall full of character and competitive in the tourist market. Having spent the past few weeks talking to constituents about this subject, I can confidently say that if the beer duty escalator continues without review, jobs, community spirit and the local economy will be under threat.

The beer and pub industry contributes £45 million a year to the local economy in my constituency. St Austell brewery is a fantastic local family business that has more than 160 years of history, that runs 170 pubs, predominantly in Devon and Cornwall, and that employs a significant number of my constituents. Since the beer duty escalator’s introduction in 2008, the brewery has seen a 23% reduction in demand, and on an annual turnover of about £100 million, it pays £25 million in tax. The burden is too high not only for that brewery but for the countless independent and unique pubs from coast to coast in the heart of Cornwall. Some 2,500 people are employed in the sector in my constituency.

[Alison McGovern (Wirral South) (Lab)]

The hon. Gentleman is painting a wonderful picture of pubs in Cornwall. Does he agree that it is important that we visit and support not only local pubs, but local breweries such as the Brimstage brewery in Wirral, which has an excellent relationship with local pubs, ensuring that people in Merseyside can drink good, local beer?

[Stephen Gilbert]

The hon. Lady is, as ever, a firm advocate for her local brewer, just as I am for mine. I take on board the point she makes; she is entirely right.

I will not detain the House for too long, but it must be recognised that beer tax in the United Kingdom is high compared with that of equivalent countries in the European Union. Ours is nine times higher than France’s and 13 times higher than Germany’s. British consumers pay 40% of the total EU beer duty, and beer duty has increased by 42% since 2008. Of course, I share my right hon. Friend the Chancellor’s view that we are all in it together, but we need to redress the balance and ensure fairness.

[Sir Alan Meale (Mansfield) (Lab)]

Drinkers in Britain pay 40% of the EU beer tax bill, but consume only 13% of the beer.

[Stephen Gilbert]

The hon. Gentleman cites a stark contrast. When he makes the point in that way, the uneven spread becomes even more apparent and visible.

I support the motion, because we need to protect pubs, which are at the heart of our communities, not only in Cornwall, but across the country. We need to make sure that we are doing all we can to drive down youth unemployment, and the beer and pub sector plays a key part in that.