Cheers, George! Pubs are the real Budget winners

A Chancellor delivering good news to beer drinkers? Surely not…
20 Mar 2013 @ 5.08 pm
| Food & drink

A Chancellor delivering good news to beer drinkers? Surely not…
A Chancellor delivering good news to beer drinkers? Surely not… George Osborne delivers Budget 2013
York CAMRA’s Nick Love toasts that most rare occasion: a Budget which serves up some positive news for our pubs

There was some welcome cheer in today’s Budget with the cutting of 1p off the price of a pint of beer. Most of us realise that our beer won’t actually go down in price on Sunday – but a least it won’t rise.

That, however, is not the real story of the day for beer drinkers. The real story is that with the scrapping of the beer duty escalator there will not be a rise of around 6p to 10p per pint, which has happened in all previous Budgets. This in turn will save up to 10,000 jobs in the pub industry and raise around an additional £5million in revenue for the Exchequer.

The scrapping of the beer duty escalator by Chancellor George Osborne today is the culmination of years of grass roots campaigning by the UK’s largest single issue consumer organisation – CAMRA. For those unaware exactly of what the BDE is – here’s a potted history:

The beer duty escalator was introduced by the last Labour Government in 2008 and has been in place until today. It has meant that despite Chancellors not increasing beer prices in their main budget speech, surreptitiously beer duty has automatically increased by two per cent above inflation anyway. This has resulted in tax on beer rising by a staggering 40 per cent since 2008. Over a third of the price of beer is tax.

CAMRA has been steadily ratcheting up the pressure since 2008 to try and get some sort of shift in government intransigence on the issue. Apart from very vocal support and campaigning from all CAMRA branches UK-wide including the very active York branch (with over 1,000 members) the first real blow was struck with the successful raising of over 108,000 signatures on a petition that forced the issue to be debated in Parliament.

High profile MPs advocating the scrapping of the duty escalator (including Yorkshire MP Greg Mulholland who is chair of the all party Parliamentary Save the Pub Group) spoke passionately about the economic effects of beer tax on the pub trade and the ongoing closures of 18 pubs every week of the year.

Rural communities were seeing their social hubs disappear and urban areas were not spared either with many notable longstanding and much loved locals going to the wall.


For me the corner was finally turned when the British Beer and Pub Association commissioned a report based on research from leading researchers Oxford Economics, were finally able to put some meaningful and hard hitting figures together to hit the Government with.

The basis of the argument was that by freezing duty and scrapping the beer duty escalator there would be a significant beneficial knock-on effect on pub closures which in turn would have a domino effect on all inter-related components such as suppliers, workers and drinkers.

Stopping the six per cent decline in beer sales would keep pubs from closing so there would be a boost to the Exchequer of employment tax revenues and a reduction in social security payments to redundant pub workers. In short, up to 10,000 jobs could be saved and revenue to the Exchequer would increase by around £5 million. Everyone wins, basically.

The TaxPayers’ Alliance then got in on the act with their Mash The Beer Tax campaign and enlisted support from national tabloids and finally the campaign started by CAMRA was gaining unstoppable momentum.

It was quite an emotional moment though when the Chancellor finally declared the scrapping of the beer duty escalator today though, as it proved that a highly successful consumer movement with over 147,000 members could really move mountains and bring about real tangible change.