Following a year-long consultation with businesses selling alcohol on locally-set fees under the Licensing Act 2003, the Home Office said it had listened to the trade's concerns about introducing locally-set licensing fees and said it did not have enough evidence of the costs local government would incur if they set fees themselves.
Crime prevention minister Lynne Featherstone said she understood the concerns of business owners that the proposed local system fees could rise without justification.
“This government strongly supports the vital contribution that responsible businesses, including pubs, hotels, restaurants and community premises, make to our economy and to their communities, and we want to avoid putting undue burdens on them," she said.
Featherstone said the Home Office would now work with the Local Government Association (LGA) to outline their costs and get a clearer picture of how the scheme could work.
“The introduction of locally-set licensing fees would affect a wide range of businesses and we need to get it right," she said. "We intend to work with local government to ensure that we move forward on the basis of up-to-date evidence.
“At the same time, we are committed to freeing up local communities to tackle alcohol-fuelled harms. That is why we have made it easier for licensing authorities and the police to deal with problem premises.”
British Beer & Pub Association chief executive Brigid Simmonds welcomed the news: "This is great news – in not moving ahead with locally set fees, the government deserves our thanks for listening to our concerns," she said. "Such a change would have damaged small community pubs, which the government is rightly keen to support."
Simmonds said pubs would be campaigning for more business rate reforms for pubs and a third beer duty freeze ahead of the Budget on 18 March.
Miles Beale, chief executive of the Wine & Spirit Trade Association added: "The proposals would have piled on further costs for licensees already facing a tough trading environment, as well as adding further inconsistency and uncertainty to an already complex licensing system”.