Breweries respond to Sunak’s claims ‘cheaper beer’ is due to Brexit
British breweries have responded to the Prime Minister’s claims that buying “cheaper beer” is one of the many benefits of Brexit.
Speaking to the drinks business, both Derbyshire-based brewery Thornbridge and Suffolk-based brewery Adnams have refuted the claims as too simplistic and reiterated the real pressures that are shaping the price of beer.
Sunak, who spoke to reporters while en route to the G7 summit in Japan, said: “We reformed the alcohol duties that mean this summer you will be able to get cheaper beer in pubs. These are all very tangible benefits of Brexit that I’ve already delivered.”
In response to Sunak’s claims that Brexit had assisted in keeping beer “cheap” for the nation, the brewers highlighted how the myriad challenges the sector is juggling make his self-congratulatory point too simplistic to give context to the real issues affecting the cost of beer.
Thornbridge COO Simon Walkden said: “The price of beer, food and other drinks in pubs has been increasing for some time and the inflationary pressures that brewers, other suppliers and the pubs themselves face continue and will continue for the foreseeable future. If brewers and pub landlords hadn’t absorbed such a high percentage of their cost increases then prices across the bar would deter customers from visiting at a time when we’re all experiencing a significant cost of living crisis. You just need to look at the figures for pub and brewery closures during the past couple of years for evidence of how difficult the trading landscape is.”
Offering further context on the challenges, Walkden revealed that Thornbridge’s “costs of production have gone up around 25-30% in the past 18 months” and told db that the brewery was seeing inflated costs across “everything from energy to wages (national living wage uplifts) to malt, cans, bottles, packaging, transport – you name it” and disclosed: “We’ve only been able to pass a very small fraction of that on”.
Also chiming in, Adnams production director, Fergus Fitzgerald pointed out that, in truth, it is not Brexit that has saved the day here because “the only significant reduction in alcohol duty is on 3.4% ABV beer which could have been done whilst in the EU” and said: “Even here, it will have no impact at the bar as it’s dwarfed by all the other costs pubs and breweries have taken”.
According to Fitzgerald, essentially, “all parties are guilty” of contributing to the cost pressures, but he insisted “the current government needs to be held to a higher standard as they, despite protestations to the contrary, have been in power for the past decade” .
Fitzgerald explained: “The duty on draught beer changing is, I believe, something that would not have been within the rules within the EU, but it is tiny, and actually the rate of draught beer hasn’t been reduced, it’s just stood still whilst everything else has gone up by inflation.”
Similarly, Walkden observed that Sunak was simply “quoting the beer duty reforms” and so this was “cherry-picking just one of the component parts of the cost of producing and selling beer and that only applies to draught beer” and explained that “any discount in the draught rate just offsets the inflationary increase in the base duty rate of just over 10%”.
Walkden explained how citing beer duty reforms as the fix for all issues in terms of the costs affecting the beer industry is “a dangerous thing to quote in isolation” because “it doesn’t address the other cost pressures breweries are facing”.
Fitzgerald agreed and said that Sunak’s claims that, owing to Brexit, “this summer you will be able to get cheaper beer in pubs” were based on “ignorance” or a “deliberate attempt to pretend” and stated: “Either it’s an amazing ignorance of what’s happened during the past year in hospitality, or a deliberate attempt to pretend that standing in the sea with an umbrella over your head means that your feet won’t get wet.”
Fitzgerald added that the spin being put on the ‘facts’ the government is peddling on beer has led him to question the validity of its other statements being circulated on other topics and admitted: “It is infuriating to see facts being distorted so heavily when we know the real impacts, and when I see it happening on topics I know something about, it leads me to assume the same is true in the areas where I am less familiar.”