More than 70% of pubs do not expect to survive winter as energy costs soar

Britain’s independent brewers have urged ministers to step in to save the sector, as research revealed more than 70% of pubs do not expect to survive the winter if nothing is done to ease energy costs.

More than 35% of pub operators told researchers they had seen their utility costs double, while 30% said their costs had tripled.

One operator told the survey by the trade publication the Morning Advertiser they had been quoted a cost for their energy that was nearly six times higher than on their current contract – with the cost per unit shooting up from 14p to 83p.

Almost three-quarters of respondents said they would not be able to afford the increases.

Among the interventions being called for by the hospitality industry are reductions in VAT and business rates, caps on energy prices for small businesses, and grants for renewable technology to help businesses lower their energy use.

Heath Ball, managing director of the Frisco Group, which operates three pubs across the south-east of England, told the Morning Advertiser that pubs were facing a “doomsday scenario”.

“This energy bill crisis comes on the back of the most testing of times as businesses try to recover from the Covid crisis and I think it poses an even greater threat to the survival of pubs,” he said.

He added that even operators that could afford to pay the elevated prices are not being offered new power contracts because the sector is deemed to be “high risk”. Ball said the government needed to “find a solution to this now or face mass pub and restaurant closures”.

Organisations representing the UK’s independent brewers have written to the chancellor, Nadhim Zahawi, urging more support for the industry.

The Society of Independent Brewers and the Campaign for Real Ale (Camra) said the sector was facing the “combined impact of energy cost increases, regular shortages, and a cost of living crisis”.

They said about 160 small brewers had been lost during the coronavirus lockdown and that at least another 40 had been forced to close this year.

The letter also expressed concern over delays to the introduction of the “draught relief” policy, a 5% cut to the duty on beer sold in pubs announced by Rishi Sunak in last year’s budget.

In July, the Treasury announced that the outcome of a review of alcohol duty would not be published until the autumn.

“Many brewers have already factored these duty changes into their planning for next year, but do not know if they will happen on time,” the letter said.

Nik Antona, chair of Camra said: “Pubgoers and beer drinkers want to see urgent action from government.

“With businesses having pulled out all the stops to make it through the pandemic, it would be a travesty if more of our local, small and independent breweries were forced to close for good now due to the crisis with the cost of energy, goods and doing business.”

Recent months have seen repeated warnings about the impact of rising energy prices on Britain’s high streets and small businesses, with recent data from the Federation of Small Businesses showing more than half of firms expect to stagnate, shrink, or fold in the next 12 months.