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BII members seek St George to slay the Darling Dragon
The British Institute of Innkeepers (BII) convened a meeting of members yesterday to debate the budget announcements as they unfolded. The mood of the group can be summed up as bitterly disappointed but not surprised by the Chancellor’s intention to continue with the 2% duty increase on alcohol.
BII chief executive Neil Robertson commented: “As we awake on St George’s Day, licensees, pub companies, breweries and everyone in the licensed trade supply chain is totting up the additional costs of this latest rise.
“It seems fitting that budget day fell on the eve of St George’s Day as some of the BII members around the table felt that only the powerful force of St George himself might help to slay the dragon that is Alistair Darling!”
The focus group included a cross-section of BII members from London, the Cotswolds, Kent and Surrey. Lessees, tenants, managers and free traders made up the group, as well as a brewery operations director and business development manager (BDM). They began by reporting that for most, although not all, trading had remained fairly static in recent months in terms of volume but that margins had been tightly squeezed so profit was not as it should be.
Neil continued: “The burden of legislation and escalating on costs have been heavy in recent years. Many free houses and tied pubs have absorbed previous tax and cost increases to lessen the blow on customers, however, this situation is not sustainable in the light of a further tax hike so it’s highly likely that this latest 2% will have to be passed on.”
This raised many issues for the group. Conrad Sturt of The Half Moon in Windlesham, Surrey, felt that the combination of fuel and alcohol tax, on top of everything else could result in as much as 20p on a pint by January 2010. This was a view echoed by Bill Sharp of the Kings Arms in central London, who spoke of the many hidden costs involved. He raised the point that suppliers would have to factor in the additional fuel costs and that they would be passed on to pubs. Gary Duff-Godfrey of The Thornbury Castle in Marylebone added that food pricing is already very volatile so these duty rises will make it worse.
Bill Sharp went on to express his anger that the automotive trade had received significant assistance and yet the licensed trade had been hit again. Chris Maclean of the Railway Tavern in Faversham agreed, saying that cars – and indeed homes – will always be here but, if the Government is not careful, pubs won’t be in years to come.
Mike Clist, tenanted operations director, and Nicky Hawkins, BDM, for Fullers Brewery further proved the point about hidden costs with a list of additional small business red tape that operators in the trade have faced in the last few years. The list included compulsory asbestos surveys, the fitting of gas cut off valves, boiler certificates, five-yearly electrical certificates, energy usage certificates, etc, etc. The list is long and costly and, of course, the proposed mandatory code of practice – which BII members consider to be unnecessary and disproportionate – will bring yet further legislative burdens.
Claire Bignell, manager of Maison Blanc in Burford, Oxfordshire, was deeply concerned that the implications of additional costs and smaller margins would have a massive impact on staffing levels. She anticipates having to reduce staff hours to lower the overall wages bill and, longer term, this will have an impact on the viability of licensed retail as a career. Neil observed: “The industry works hard to promote the licensed trade as a highly worthwhile and professional career choice and attitudes have been shifting in recent years. There’s no doubt that the situation we now find ourselves in will significantly affect people’s perceptions. These are the subtle, yet far reaching, consequences of the Government’s harsh measures on our industry.”
BII is a registered charity and the professional body for the licensed retail sector. It has over 16,000 members and 54 corporate patrons, members and supporters.
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