Saturday, 11 February 2017

What difference a penny?

I’ve been a member of CAMRA for over 40 years, and whilst I’ve broadly supported most of its aims over the past four decades, occasionally the Campaign gets it spectacularly wrong. A prime example can be found on the front page of this month’s “What’s Brewing” newspaper, which calls for MP’s to write to the Chancellor of the Exchequer, and ask for a 1p cut in beer duty in next month's budget, which takes place on 8th March.
The campaign for a cut in duty is being spearheaded by the British Beer and Pub Association (BBPA), but CAMRA has also thrown its weight behind it, and is asking members to lobby their MP in support of a 1p cut in beer duty.
British drinkers pay the highest rate of duty in Europe, but what difference would a cut of one penny make?
CAMRA national chairman, Colin Valentine stated that in previous years, the Campaign had been able to secure cuts to beer duty in 2013, 2014 and 2015 and last year, the Chancellor implemented a duty freeze. Mr Valentine highlighted that the UK is still paying among the highest rate of beer duty in Europe at 52.2p on the pint. This compares to other big brewing nations which pay a tenth less than UK beer drinkers such as Germany and Spain, who enjoy their beer at under 5p of duty on a pint.
He concluded by saying that the beer, brewing and pubs sector now supports nearly 900,000 jobs in the UK, and contributes £23.6bn to the economy every year, and that a further cut would help encourage investment, protect jobs and improve confidence in the sector.

Now I’m sure all this is true, and in an ideal world most drinkers would like to see a reduction in beer duty, but a penny off the average cost of £3.40 a pint is neither here nor there. If you will pardon the pun, it really is small beer, and is certainly not worth anyone’s time and effort in lobbying parliament over. I also understand that as a "campaigning organisation", CAMRA needs to be seen as "doing something", but there are other areas where the group's resources could be used to far better effect, than by pleading for beer drinkers to be treated as a "special case".
A lot on his mind
To put things into perspective, I’m pretty certain the Chancellor has far weightier issues on his mind than a trivial and rather pointless cut in beer duty. For a start there is a massive hole in public finances. There are "vanity projects" to be funded, (Heathrow expansion, replacing Trident and constructing hugely expensive nucler power plants*); all this whilst the NHS is in crisis, exasperated by savage cuts to the social care budget. Whatever one’s political persuasion is this really the time to be lobbying for a cut in beer duty? In addition, what difference would a penny make anyway? Especially when previous duty cuts have not always been passed on to customers, but have been pocketed by the brewers instead.
CAMRA then gets on to its other hobby horse, that of encouraging “responsible drinking”. According to the Campaign's logic, this can only take place in a pub, as responsible adults cannot be trusted to imbibe alcohol with any sense of responsibility in their own homes. Mr Valentine states that pubs offer the chance to socialise with friends whilst enjoying a pint, but high taxation is driving people away from community pubs and towards the supermarket and other stores to buy their beer.
This of course, over-simplifies the issue. No-one would disagree that the British pub is a great institution, but it is not just high prices which are keeping drinkers out of the pub, but rather a whole combination of changing demographics and changes in social habits.
The call, therefore by both the BBPA and CAMRA for a reduction of up to £5000 in business rates for pubs across England, in order to alleviate the tax pressure on pubs, is likely to fall on deaf ears, especially in the straightened times the country finds itself in.
I will not be lending my support to this campaign; not just for the reasons outlined above, but because, over the last few months, I have invested an appreciable amount of time corresponding and meeting with my local MP over an issue of far greater national significance. No surprises for guessing as to what this might have been; but from my own experience I found my Member of Parliament very approachable and wiling to listen; even though he was ultimately unable to offer the support I was looking for.
So don’t knock the parliamentary process, at least not at local constituency level (the over-bearing influence of political parties on how MP's vote on national issues, is another matter, and is one of real concern.). It's also safe to say that Members of Parliament do have slightly more important, and rather more pressing issues to deal with than trivial matters, like a penny off a pint of beer!

* Btw, I have no political axe to grind over any of these projects. They just have two things in common; one they are very expensive, and two, can the country actually afford them?


Curmudgeon said...

I'd say in presentational terms it would make much more sense to be campaigning for a duty freeze rather than a cut that would appear nugatory.

Also, if you're interested in supporting pubs, a duty cut has a much higher proportional impact on the price of off-trade beer than that drunk in pubs.

Paul Bailey said...

A freeze in beer duty would be the more sensible option, and it would also stop health campaigners (Temperance lobby), from claiming that beer drinkers are being rewarded with a tax cut, at a time when the NHS is crying out for extra funds.

I also agree that a duty cut has a more beneficial pro-rata effect on off-trade beer prices, than it does on the cost of a pint in the pubs. CAMRA and the BBPA seem to have either missed this or, more likely, ignored it altogether.