‘Trouble brewing for small beer producers’
Holloway Road landlord warns government’s changes to relief scheme could force prices up in pubs
04 September, 2020 — By Sam Ferguson
Ade Clarke: ‘During the lockdown pubs were given grants that helped us out, but a lot of the smaller brewers didn’t see any of that support, and it’s been pretty tight for them’
A PUB landlord has warned government changes to the amount of tax paid by small breweries could increase the price of pints and put pressure on already struggling brewers.
The Treasury is due to begin a consultation on changes to the Small Brewer’s Relief scheme in the autumn. At the moment, hundreds of breweries that produce between 2,100 hectolitres and 5,000 hectolitres a year benefit from a 50 per cent duty threshold.
But the government is looking to reduce the level of production at which breweries are eligible for tax relief. Campaigners say this would benefit the larger breweries while hitting smaller operations the hardest.
Ade Clarke, who runs The Lamb in Holloway Road, told the Tribune it was inevitable that prices would rise in pubs as a result of the changes.
“During the lockdown pubs were given grants that helped us out, but a lot of the smaller brewers didn’t see any of that support, and it’s been pretty tight for them,” he said.
“We’re a pub that deals with a lot of small to medium-sized London breweries, and they are the ones who are going to be affected by this. Beer in London isn’t cheap, and we pride ourselves on supporting local breweries.”
Mr Clarke added: “We try to keep our prices down, and if these smaller breweries have to raise their prices for us, then our prices will have to go up. But if it’s too much, it might mean we have to look elsewhere.”
Trade body the Campaign for Real Ale (Camra) has urged the government to change its plans.
National chairman Nik Antona, said: “Small Brewer’s Relief has been instrumental in creating the brewing boom that we have seen over the past two decades and is vital to maintaining a thriving and diverse beer market, and choice for consumers.”
“The news of these poorly considered reforms to the Small Brewers’ Relief scheme could not come at a worse time for our small brewers, who are already facing financial uncertainty due to the coronavirus crisis.”
John Hobday, whose petition calling on the government to maintain the 50 per cent threshold has been signed by more than 35,000 people, said the uncertainty around the changes only added to the stress faced by brewers.
He said: “This is creating grave uncertainty for many small breweries at a time when the industry is trying to survive the Covid-19 crisis.”
A Treasury spokesperson said: “We invest over £65million per year in craft brewing through Small Brewer’s Relief. We’ve consulted with hundreds of breweries who have told us that the relief was being withdrawn too quickly, and therefore preventing their businesses from growing.
“To support these small breweries, our proposals will mean that they’ll still benefit from the relief as they gradually expand their businesses, rather than having an all-or-nothing approach where it’s rapidly withdrawn above a certain level.”