Drinks industry reacts to Rishi Sunak becoming Prime Minister

Despite coming second to Liz Truss in the leadership contest last month, Rishi Sunak has now been named the next leader of the Conservatives and UK Prime Minister after a turbulent few weeks in Westminster.

 

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Six weeks is a long time in politics, and it was long enough to give Sunak another chance at Number 10. After just 45 days in office, during which time Chancellor Kwasi Kwarteng’s mini-budget froze alcohol duty but then caused the pound to crash, Liz Truss was forced to resign as pressure from Conservative MPs grew. Though it looked like Sunak might have to compete with Boris Johnson and Penny Mordaunt for the top job, both withdrew from the running, leaving the path clear for him to take charge.

Sunak, who is teetotal, attracted some criticism from drinks industry bodies over the summer during his first leadership campaign for his support for raising duties. One of his fiercest critics was Miles Beale, chief executive of the Wine & Spirit Trade Association (WSTA). In response to the news of Sunak’s victory, Beale said: “The wine and spirit sector needs a period of stability in government accompanied by sensible and fair policies which will allow them to recover, invest and grow. We hope that the new PM, Rishi Sunak, and his Cabinet – including his Chancellor – focus on delivering policies which support growth, support British businesses of all sizes and which avoid unnecessary, costly red tape and punishing taxes.”

WineGB CEO Simon Thorpe MW said: “We look forward to our new Prime Minister’s plans for his cabinet and in particular to working with the Ministers appointed to the departments with whom our industry already works closely. We will continue our discussions with the Wines of Great Britain All Party Parliamentary Group and the Treasury to ensure that English and Welsh wine producers can benefit from access to the Small Producers Relief Scheme and treated fairly and in the same manner as small beer and cider producers.”

Scotch Whisky Association chief executive Mark Kent congratulated the new Prime Minister and thanked him for his support during the pandemic, but warned of the perils of the “inflationary storm”: “The Scotch Whisky industry faces rising energy costs, supply chain pressures and fragile consumer confidence. The reversal of the freeze on alcohol duty further dented industry confidence, and we call on the new Prime Minister to work with the Chancellor to reinstate the duty freeze at next week’s fiscal event…Duty freezes have consistently increased the tax take of the Treasury, and we urge the government not to jeopardise this with no guarantee of an economic return.”

Kent also repeated the same call for a trade deal with India to reduce the current 150% tariff on Scotch that he asked for when Truss came in.

Nik Antona, the national director of the Campaign for Real Ale (CAMRA), asked Sunak to meet him in his Richmond, Yorkshire constituency: “I want to take this opportunity to extend an invitation to the Prime Minister to join me at the George and Dragon pub in his constituency to talk further about CAMRA’s aims for the beer and pub industry. This community-owned pub, and previous winner of our prestigious ‘Pub of the Year’ award, is a fantastic example of everything a pub can be, and I believe it is urgent that UK’s pubs, social clubs, breweries, cider producers are made a priority by Government.”

“The sector needs ongoing support on energy bills lasting beyond April 2023, the positive reforms from the Alcohol Duty Review to be implemented as quickly as possible, a cut on VAT for on-trade food and alcohol and reform of the business rates system,” Antona continued.

UK Hospitality chief executive Kate Nicholls noted that it is a “critical time” for restaurants, pubs, bars and cafés: “Now is the time to steady the economy, deliver for the needs of the country and support businesses to help drive growth and create jobs. Hospitality clearly displayed its ability to grow prior to the pandemic and was on the road to a strong recovery before the energy crisis hit. It can return to those levels through pragmatic decision-making that eases the acute challenges businesses are facing.”

“We worked very closely with the new Prime Minister in his previous role and we look forward to working with him again to address the current strain on businesses and bolster consumer confidence. I would encourage him to extend business rates relief, reform the entire business rates system in the longer term and lower the current rate of VAT,” Nicholls concluded.

To read how the drinks industry reacted when Liz Truss came to power in September, click here.