Covid pandemic: Drinkers shun beer for wine and spirits

Beer sales plunged in the UK during the Covid pandemic as people avoided pubs and drank wine and spirits at home instead, industry analysis found.

Pubs, bars and restaurants lost £5.7bn of revenue from beer sales in 2021 alone, the British Beer and Pub Association (BBPA) said.

It called on the government to cut beer duty to help it recover from the effects of the pandemic restrictions.

The Treasury said it froze beer duty for a fourth year saving brewers £900m.

People started drinking at home more during the pandemic, splashing out on wine and spirits while pubs, bars and restaurants had to grapple with changing Covid restrictions, the BBPA said.

In 2021, pubs, bars, restaurants and clubs served the equivalent of 1.4 billion pints less, the trade body said.

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Emma McClarkin, chief executive of the BBPA, said every unsold pint was "a stark reminder of the dislocating effect Covid restrictions had on our sector and the communities our pubs sit at the heart of".

The industry group also analysed alcohol taxes collected from March 2020, when the first lockdowns started in the UK, to October 2021, when some of the restrictions were relaxed.

It found beer receipts fell by £681m to £5.4bn, while wine receipts increased £583m to £7.7bn and spirits receipts rose £784m to £6.9bn.

The BBPA also called for taxes to be linked to the strength of the alcoholic drink, with lower-alcohol drinks being taxed less.

"Our analysis showing falling beer consumption supports the Treasury's stated objective to incentivise lower-strength products and differentiate beer from stronger wine and spirits as part of planned reforms to the alcohol duty system," Ms McClarkin added.

"We must again ask ministers to go further and support our recovery by continuing to reduce the punitive tax burden on our sector to ensure the sustainability of brewing and pubs."

'Cutting beer tax won't help pubs'

However, Richard Piper, chief executive of charity and campaign group Alcohol Change UK, said "Alcohol duty overall must rise faster than inflation every year, so we reduce, not increase, alcohol harm".

He argued lowering the taxes on beer would not benefit pubs either.

"It would apply equally to the supermarkets, and because of purchasing volumes this in fact makes the differential between pub and supermarket prices even bigger - harming pubs," he said.

"Beer duty cuts are primarily called for from the huge manufacturers, not pub landlords. These massive beer producers, many of them not even based in the UK, love to hide behind the pub image, while behind the scenes they are raking in millions in profit from alcohol harm."

He said Alcohol Change supported the Treasury's proposals, along with the BBPA, to bring in a cut to duty on draught beer and cider. The "draught relief", he said, would support pubs "far more effectively than a blanket reduction in beer duty, which would only subsidise the already dirt-cheap supermarket prices".

The Treasury said draught relief - aimed at supporting pubs by cutting taxes on their most popular products - would see the duty on a pint fall by 5%.

Under the new plans, a pint of 3.4% alcohol beer will attract 25p less in duty and VAT.

A spokesman said the government had "comprehensively backed pubs and brewers alike throughout the pandemic" through the furlough scheme, grants, reduced VAT and business rates relief.

"We welcomed views from the industry on the qualifying criteria for our proposed alcohol duty reforms as part of a consultation process and we're currently analysing responses," he added.