'Action needed to save our national drink'

November 21, 2007: The biggest slump in beer sales since the Great Depression has prompted an industry group to write to MPs calling for urgent action to rescue Britain’s national drink.

	THE BBPA
	The British Beer & Pub Association represents many members in the brewing and pub sector. Its members account for 98% of the beer brewed in the UK and own nearly two-thirds of Britain’s 58,000 pubs.

The letter from the British Beer & Pub Association (BBPA) says that stark market conditions are being made worse by the Government’s current tax policy.

The group says that:

l The volume of beer sold through pubs is at the lowest level since the Depression of the 1930s
l Overall beer sales — through pubs and the off-trade — are at their lowest level since 1969
l The total beer market has fallen by 22% since its peak in 1979. That’s a loss of more than 2.5 billion pints, meaning 7 million fewer pints a day are being sold.
l Pub beer sales are down 49% from their peak in 1979. That’s a loss of more than 5 billion pints — meaning today’s pubs are selling 14 million fewer pints per day.
l Costs are soaring — barley, malt, glass, aluminium and energy prices have all risen sharply.
l Between 2004 and 2006 the profits of the major brewers in the UK have fallen by 78%. The result of the squeeze is that companies now earn only 0.7p per pint profit, compared with the average of 33p per pint they pay to the Chancellor in beer duty.

Over the last decade, because beer has been in the front line of tax increases, current tax policy has only increased the burden on brewers, says the BBPA.

Since 1997 beer duty has increased by 27% while consumption fallen by 11%. In contrast, over the same period, spirits duty has risen by only 3% and spirits drinking has risen by 20%. Wine duty has increased by 16% and wine drinking by 46%.

“We believe the benefits that have been enjoyed by other drinks from a tax freeze should be extended to Britain’s national drink — beer,” said Rob Hayward, chief executive of the BBPA.

“The time to support our national drink is long overdue. We are calling for Government policy to encourage and support Britain's businesses. British brewers and beer are of world renown. But our efforts to remain competitive are being undermined by a tax policy that is eroding the foundations of our business.

"We need a tax freeze and that is what we are calling on the Chancellor to deliver.”

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