‘It’s painful to feel so out of touch’ – UK beer and pub bosses react to the General Election result

In Manchester, the owner of one of the UK’s most popular independent breweries is still reeling from Boris Johnson’s comfortable victory last night.

“It’s incredibly painful to feel so out of touch with the rest of the country”, Paul Jones, who runs cult craft brewer Cloudwater, told the drinks business.

Jones stayed up in the taproom with a group of friends to catch the Exit Poll’s release, which predicted the Conservatives would win by a landslide. He went to bed shortly after.

He told db his feelings of pain and fear are as personal as they are business-focused. Many of his staff have struggled with mental or physical health issues and rely on the NHS for support, but under the Conservatives, spending increases have slowed down dramatically, while A&E waiting times have soared.

Johnson has also promised to cut immigration levels and make it harder for non UK residents to access public services like healthcare, something which weighs on the Cloudwater owner’s mind. Some of his 43 members of staff come from outside of the UK.

“Vilma who runs our shop is Lithuanian,” he said, adding that there are employees across the business who are “affected by anti-immigration sentiment.”

The Conservative manifesto pledged to cut business rates and alcohol duty to aid the drinks industry, but Jones said that “if the government continues under an austerity policy, we can’t separate ourselves form the very real impact their policies have on people’s quality of life.”

“The government encouraging people to drink beer could be good in some ways,” he said, “but that’s not why we’re in the business…a lot of us are personally devastated because we do not like to live in a world that feels selfish.”

Meanwhile, Tim Martin, the pro-Brexit founder and chairman of J.D. Wetherspoon, was “pleased with the result,” especially with Labour’s crushing defeat, but unconvinced the Conservatives’ pledge to reform business rates or alcohol duty would automatically help operators in the on-trade.

“The moral of the election is that people are intelligent and understand that a state takeover of business, as advocated by Jeremy Corbyn, wouldn’t help them or the economy,” he told the drinks business over text this morning.

When it comes to policies affecting the drinks industry, the party said it would:

  • Cut business rates for small retail businesses (such as pubs, bars and restaurants, and independent retailers)
  • Launch a £150 million Community Ownership Fund to help purchase “community assets” (which includes pubs)
  • Review alcohol duty rates to ensure the tax system is supporting British drink producers.

The British Beer and Pub Association (BBPA) and Campaign for Real Ale (CAMRA) have been campaigning for business rate reform for some years.

The rate at which businesses should be taxed is decided by Valuation Office Agency (VOA), and is based on the annual level of trade it is “expected to achieve if operated in a reasonably efficient way.” This is based on factors such as the area a pub or bar is located in, the services it offers like food or sports screenings, rents and annual turnovers.

Rising business rates have swallowed profit margins and put small businesses under pressure in recent years, and been blamed for creating a challenging high street environment that has led to pub, bar, and shop closures across the country. More than 900 restaurants have closed in Britain in the year to June 2019, averaging out at 18 closures per week, according to data published by CGA and AlixPartners in August.

But Martin said that other pub owners should “not campaign solely for rates reform”.

“The thing to go for is tax equality between pubs and supermarkets- pubs pay 20% VAT on food sales and supermarkets pay nothing,” Martin said.

Martin added: “Pubs pay about 20p business rates per pint and supermarkets only about 2p. Politicians want to invest in high streets and pubs are an integral part- so go for tax equality!”

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