Sign up for email updates
Thank you, Ms Vaz, for calling me to speak. It is a pleasure to respond to this important debate on behalf of His Majesty’s Official Opposition, and I congratulate my hon. Friend
Pubs and hospitality are a force for good. They are good for the economy, contributing more than £120 billion nationally and delivering £54 billion in tax receipts to the Treasury, which I am sure the Chancellor will be grateful for next week. They are good for jobs, employing 3.5 million people across every age band, from teenagers to pensioners, and with an even gender balance. They are also good for our communities; our pubs, cafés and restaurants are the heart of local life, bringing people together. Indeed, for many villages the pub or café is the last service surviving in the village, offering a community hub that covers everything from jobs clubs and parents and toddler groups through to serving as the village shop, and even—as I saw at one Pub is The Hub initiative in Cornwall—the hairdressers.
Pubs are a force for good socially, helping to tackle the scourge of loneliness and isolation. Few people could have failed to be moved by the advert for Charlie’s Bar last Christmas. It shows an elderly man walking from his house to his wife’s grave, raising his cap to passers-by, only to be blanked, but he finds comfort and companionship in his local in Fermanagh.
Less well celebrated are the hundreds of initiatives up and down the country, such as the Go To Place at Love & Liquor in Codsall in my constituency, which brings 60 or more people together each Wednesday morning for a coffee, a chat and a bit of breakfast. Although we are all too familiar with the dangers of excess drinking, well-regulated and well-run pubs and bars are forces for good for our mental health. The work done by Professor Dunbar at Oxford university shows that people who have a local where they drink regularly in moderation are likely to be happier and more content than those who do not. Their physical and mental health is likely to be better than that of people who do not. They are likely to have more friends on whom they can depend and feel more engaged in their community than people who do not.
Pubs and hospitality venues have, of course, faced a range of pressures over the past few decades, some of which have been referred to. Some are the results of changing consumer demands, preferences and social habits, but others have been exacerbated by policy decisions made here in Westminster and Whitehall, such as the smoking ban, high business rate bills, and alcohol duty rates that are significantly higher than most western European countries.
The previous Government took a range of actions to help to alleviate some of those pressures. They abandoned Labour’s hated duty escalator, which had meant above-inflation rises in duty every single year. They cut beer duty for the first time in half a century, and introduced multiple freezes in duty, which means that beer duty on a pint in a pub is now significantly lower in real terms than it was in 2010. They introduced a reduced rate of duty for draught beer and cider, taking advantage of the freedoms after Brexit. They helped to reduce the huge disparity in the costs that pubs and bars face, compared with supermarkets and off-licences.
The link between duty rates and alcohol consumption is tenuous, but we know that higher taxes on alcohol lead people to switch their drinking from well-regulated licensed premises to drinking at home, and from drinking lower strength beers and ciders to higher alcohol by volume wines and spirits.
Crucially, hospitality and retail business rate relief has meant that small and independent hospitality venues have received 75% off their business rates. That has made the difference for many between being able to continue and being forced to shut their doors for good.
The new Government made a lot of promises before the election, some of which they now seem to be trying to row back from, but pubs and hospitality need them to deliver now, starting with next week’s Budget. The Chancellor needs to start with a cut to alcohol duty. A return to the previous Labour Government’s approach of continuous duty rises would be devastating for many pubs and breweries. That could be done by widening the draught beer duty differential, cutting the cost of draught beers and ciders in pubs, bars and restaurants, and targeting support where it is desperately needed. Above all, the Chancellor needs to finally publish her replacement for business rates with a new system that is fair for the hospitality sector, which pays a disproportionate share of business rate receipts—