Small independent breweries in the UK are struggling in the face of rising costs for essential materials such as fuel, CO2, energy, bottles, cans and packaging, according to an industry body.
The Society of Independent Brewers (SIBA) warned ahead of the Budget that these cost pressures are making it impossible for many small breweries to bounce back from Covid-19 lockdown and social distancing measures which hit the pub and brewing industry hard.
Around a decade’s worth of industry growth has been lost, with brewery numbers in the UK slipping back considerably due to closures caused by Covid. And costs are rising, with businesses reporting price increases in supplies such as CO2 (up 73%), brewery energy (57%), beer cans (up 20%) and cardboard packaging (up 22%), as well as an average 17% increase in vehicle fuel costs.
This is making it very hard for the small breweries that survived the pandemic to fully recover, explained SIBA chief executive James Calder.
“If the government doesn’t begin to back rather than burden small breweries with tax rises, then we’re headed towards a time-bomb of brewery closures in the New Year,” he said.
Last week another industry group, the British Beer & Pub Association (BBPA), met with Treasury officials to discuss the brewing and pub sector’s concerns. It stressed the importance of co-investment from the government in the form of a fairer tax burden and more level playing field with other European nations post-Brexit.
“Investing in our brewers and pubs is investing in our communities and society to build back better,” said Emma McClarkin, chief executive of the British Beer & Pub Association. “In return we will create jobs, boost the local economy and help our communities reconnect and unite again.
“If the government is serious about levelling up, it must get serious about reducing the tax burdens on our sector.”