A recent report by the Campaign for Real Ale (CAMRA) has revealed that pubs across the UK are closing at an average rate of 18 per week with 476 closures within the first 6 months of 2018. The reason for the closures is reported to be directly linked to the costs that publicans are to face including beer duty, business rates and VAT. All of which will ultimately be passed on to customers, potentially making pubs too pricey for many to attend on a regular basis, or at all.
Mounting pressure from Brexit
In a recent article, I discussed how Brexit is set to add further pricing pressures to many British publicans, even the larger pub chains such as JD Wetherspoons. Many are already taking measures to source drinks from non-European sources to try and keep their prices competitively low.
"Pub closures make us all poorer"
Jackie Parker, the CAMRA chairwoman said the report paints a "dismal picture" for pubs.
Jackie went on to state, "as taxes continue to rise, more people are choosing to drink at home and as a consequence, pubs are closing down. It's a vicious cycle. Pub closures make us all poorer by reducing overall tax revenues raised by the pub sector and weakening community life in areas where valued pubs close. Fundamental change is needed if the British pub is to survive for future generations. We are urging the Government to take action to secure the future of our pubs by relieving the tax burden."
A cornerstone of British society
The CAMRA website states that “Pubs play a very important role in our national economy, contributing £23.1 billion to the UK economy annually. They also provide a wealth of social benefits to individuals and communities, bringing people together and making them happier, better connected and more trusting.”
British pubs are therefore essential for employing thousands of people, generating billions in revenue, for providing a social hub in local communities and further, the local pub is also a cornerstone of British society.
What's next for British pubs?
The next budget (November 2018) is currently set to see Beer Duty rise by approximately 2 pence per pint. Business Rate Relief is also set to change, meaning pubs will be approximately £1,000 per annum worse off. If the proposed budget is announced it will have a serious effect on the leisure and hospitality industry, as well as the thousands of people working in pubs.
How can pubs prepare for the budget and survive the strain?
Whilst the outlook might seem bleak there are perhaps ways and means to prepare for the budget and hopefully ensure that your pub survives the financial strain.
Raise your voice and lobby your local MP
Pub landlords should contact their local MP and raise their concerns with the proposed budget asking him/her to lobby this with Parliament. If enough MP’s are raising this is as a serious concern there is a greater chance the Chancellor of the Exchequer will reconsider the budget in favour of publicans.
It is important at this stage to have a strong message to present to your MP, such as the effect on employment and/or the fact the pub has been in existence for numerous years and is a local social hub for the community. You should mention any local clubs or societies that use the pub as a weekly meeting venue and highlight how local pubs increase traffic and tourism to British towns and cities.
There's strength in numbers - join a group...
Becoming a member of local publican networks or national groups such as UK Hospitality will help to raise your profile and make it more likely that your message to your local MP and the Chancellor is heard. Joining other groups (such as CAMRA) will also boost your power and they could offer assistance if your pub is facing difficulties or needs help with campaigns to boost sales and visitors.
Encourage your community to engage and build a history
Ask your local community to get involved in saving the pub. The community can assist with lobbying local MP’s, sign petitions to the Chancellor and can be encouraged to use the pub more often to ensure its survival. Consider the history of your pub and whether it is on a local list of heritage assets. If it isn't then consider applying to have the pub listed as this could assist in ensuring the future survival of the pub.
Branching out to local community groups and sports clubs is also a great way to meet other people in the community and simple ideas such as offering them a free weekly meeting space in the pub increases community spirit and increases the pub's profile, profit and chance of surviving the budget.
To speak to a member of our leisure & hospitality team please contact us at leisure&[email protected].
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.