One in three pubs unable to break even

By James McAllister

- Last updated on GMT

One in three UK pubs unable to break even post-Coronavirus lockdown trading BBPA

Related tags: British beer & pub association, Coronavirus, lockdown, Government

More than a third of UK pubs cannot break even one month after reopening, according to the British Beer & Pub Association (BBPA).

In total 37% of BBPA members said they remain unable to break even; while 25% of brewing and pub sector businesses said they didn’t feel their business was sustainable beyond the end of March 2021 at present.

The findings, which come exactly one month after pubs in England were able to reopen following the Coronavirus lockdown, further underline the severity of the situation faced by Britain's pub sector. 

In response, the BBPA has called on Government for continued sector support in the medium and long-term to enable a full recovery.

More specifically, it has said that more support is needed for community pubs who tend to only sell drinks or small food items, and so are less likely to benefit from VAT cuts to food and the Eat Out to Help Out scheme.

It has also urged Government to cut beer duty by 25%; cut VAT on beer served in pubs; and fundamentally reform business rates.

“One month after they were able to reopen in England, over a third of pubs are struggling to break even or turn a profit," says Emma McClarkin, chief executive of the BBPA.

"This is inevitably due to lower consumer confidence and reduced capacity for pubs.

“We fully support the Eat Out To Help Out scheme and the temporary VAT cut to food and accommodation in pubs and hope they will help boost pub sales.

“However, to ensure the full recovery of our sector, including Britain’s world class brewers and pubs at the heart of communities across the UK, we need the Government to increase its support.

“£1 in every £3 spent in a pub goes to the taxman and now is the time to reinvest that money in our brewers and pubs. That means cutting beer duty by 25%, as well as making the VAT cut permanent and extending it to beer in pubs to bring the cost of a pint down and unlock investment.

“Fundamental reform is also needed of the business rates system – pubs pay 2.8% of the business rates bill, despite accounting for just 0.5% of turnover.

“Crucially, the Government must play a leading role in building public confidence to go out and visit pubs again, by delivering consistent and positive messages about their reopening.

“Our sector is a resilient one, and 75% of brewing and pub businesses say they are sustainable at present, but that still leaves 25% that are struggling and it would be catastrophic for our culture and economy if they are denied the support they need.

“Now is the time to recognise and invest in our pubs and brewers to secure them for future generations and to enable growth.”

Related topics: Business

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