Independent Brewers: Small Brewers Relief

Part of the debate – in the House of Commons at 6:35 pm on 6 September 2022.

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Photo of Robin Millar Robin Millar Conservative, Aberconwy 6:35, 6 September 2022

I congratulate Owen Thompson on securing the debate on this important issue. I know that brewing generally is of great interest to many colleagues.

My constituency of Aberconwy is home to some of the finest—I might say the finest—local food and drink producers anywhere in the UK. I am proud to support that industry and sector in my constituency. I welcome the bold reforms to alcohol duty, and the support for pubs and brewers, in the last Budget. I am also proud to SIBA, the Society of Independent Brewers, in its “Make it 20” campaign, which seeks to apply a 5% reduction in beer duty to 20 and 30-litre kegs. I will briefly outline why the campaign is important to small breweries by using the example of the Wild Horse Brewing Co in Llandudno.

The company is in my constituency and sells more than 70% of its annual production in 20 and 30-litre kegs. As it has grown, it has made a significant investment in 600 30-litre kegs. Most of its beer is sold to small independent bars, pubs and restaurants, which rely on smaller containers in order to offer variety and keep the beer fresh. Given that most of the brewery’s beer is sold in 20 and 30-litre kegs, it will not benefit from the 5% reduction in beer duty, and because none of its beers is under 3.5%, it will not benefit from the widening of the lower duty bracket. This is a business that, with support from the UK Government, has overcome the challenges of the pandemic, and has invested in its future and in the town of Llandudno in my constituency. Over the last 18 months, Dave Faragher, the managing director and founder, has increased his team from seven to 10 employees, two of whom originally started with the UK Government’s kickstart scheme.

Breweries and pubs are businesses that are vital to jobs and communities throughout the UK, especially in constituencies such as mine. Llandudno is known as the queen of resorts and is one of the largest resort areas in Wales. It is important that such businesses are supported and their contribution to the economy recognised, yet there can be no doubt that these same breweries and pubs have faced unprecedented challenges over the last three years. The sector bore the brunt of the economic consequences of the lockdowns and the trading restrictions of the pandemic. It now faces the challenge of rising costs of ingredients and energy—issues of huge concern for such an energy-intensive industry.

Just this weekend, small breweries learned of a threefold increase in CO2 prices and a likely supply crunch at the end of September. Production of CO2 in Billingham—one of the largest producers, which is responsible for about 60% of UK production—will end and Ensus will stop its production for three weeks. As we know, CO2 is vital not just for breweries, but for the entire food and agricultural sector, which falls within the purview of the Department for Environment, Food and Rural Affairs. I therefore must take this opportunity to call on DEFRA to take urgent action, as happened last year—it has shown itself able and willing to do so—to secure CO2 production and supplies, and to reduce costs.