The pub industry on the Isle of Wight, worth tens of millions of pounds, could take a hit if beer duty is raised as expected next week, Britain’s Beer Alliance has warned.
Tax on beer is expected to rise by 3.4% in the Chancellor’s Autumn Budget, delivered on Tuesday. With consumers increasingly opting for cheaper supermarket drinks and pub margins stretched, local establishments are braced for further struggles.
Nearly 2,000 working in pubs and bars
New analysis from Oxford Economics shows that the Isle of Wight’s 135 pubs and bars employ 1,888 people directly, paying them £15 million in wages.
They also support another 517 jobs and £10 million in wages indirectly, either through related jobs, like those in the supply chain, or through the money spent by people working in the pub industry.
In total, through salaries and spending power, the area’s pubs contribute £49 million to the local and national economy, the analysis shows.
Regional and national picture
There are 6,111 pubs across the South East, adding £2.5 billion to the economy.
Across the UK, 3.2 pubs have closed on average every day over the last two years. If that trend continues, Britain’s Beer Alliance, an umbrella organisation for major brewers and pub companies, says one in ten pubs nationwide could close within five years. It would mean a significant loss to the estimated £18 billion pub industry, which supports around 800,000 jobs.
Beer increases could change habits
A survey conducted by the organisation shows that more than a third of people would reconsider a trip to the pub if beer prices increased.
It also showed that a decrease in pubs could cause more than just financial loss, with 77% saying that they go to the pub as a place to relax and unwind, and two in five saying it acts a social hub.
Heart and soul of communities
David Cunningham, programme director of Britain’s Beer Alliance, said:
“Pubs are the heart and soul of our culture and communities, they support many jobs, contribute significantly to the economy and are dear to people’s hearts right across the country.
“Pubs already face a range of tax pressures and if the Chancellor raises beer duty in line with Retail Price Index inflation as planned on 29th October, pubs will feel the pinch even more. Seven in every ten alcoholic drinks sold in a pub is beer, so it’s easy to see how a small tax increase adds up over a year.
“Based on current closure rates, we estimate that within five years more than one in ten pubs in the UK will have closed for good, costing thousands of jobs. This will have a devastating effect on communities up and down the UK.”
Adding £56 million to the economy
There are three breweries on the Isle of Wight, supporting 79 jobs and adding £1.7 million to the economy, according to the Oxford Economics analysis.
Altogether, the local pub, brewery and beer trade on the Isle of Wight adds £56 million to the economy, it says.
Article shared by Data Reporter as part of OnTheWight’s collaboration with Press Association and Urbs Media
