The view from Westminster

We have a new year, a newish Prime Minister and set of Ministers and many new challenges for breweries to grapple with in 2023. Many of these challenges come from a significant and problematic lack of detail and certainty which makes planning extremely difficult over the next few months.

Take for example the much-welcomed extension to the freeze in alcohol duty revealed in December. Readers will remember that this was originally announced in September by one Chancellor, then unannounced in October by another before not being announced at all in the Autumn Statement in November. It took until December for breweries to learn that it will be frozen until 1 August when the wider Alcohol Duty System changes are expected to come in. We should learn in the Spring Budget (right in the middle of BeerX) what the overall duty rates will be from the summer.

As part of its lobbying activities SIBA is pushing for the Chancellor to make the new draught duty relief a focus in the Budget and increase the rate from five percent to 20%. Breweries will remember that one of the more radical changes in the new alcohol duty system is the introduction of a draught duty relief – a reduction in duty for beer packaged into large containers. Thanks to SIBA’s successful Make It 20 campaign, the Government agreed to include the 20 and 30 litre containers used by small breweries and community pubs in the scheme. We now hope to build on this and get the Chancellor to Make It 20% - and increase the discount to 20%. You can help by contacting your local MP by using one of SIBA’s template letters in the next few weeks.

We’re also hopeful that we will get the final details of what the far reaching alcohol duty system will look like and SIBA will be holding webinars in the next few months to help you prepare. In the meantime a great source of information is our briefing and calculator available on the Toolbox. It will help you get your head around HLPA, cash basis, draught duty and small producer relief amongst the many other changes.

Thanks to SIBA’s successful Make It 20 campaign, the Government agreed to include the 20 and 30 litre containers used by small breweries and community pubs in the scheme.

More uncertainty has sadly followed from the latest development on energy assistance. The Government is replacing the Energy Bill Relief Scheme with the Energy Bills Discount Scheme. While the new scheme is less generous, breweries are included under the Energy and Trade Intensive Industries (ETII) support – which is a higher level of help for certain sectors. I think that all the case studies that you sent in (and we shared with the Government) helped to make the case for our inclusion in this support. However (at the time of writing) we still do not know the eligibility or the application process and may have to wait until the end of March for the final details.

The other big uncertainty is the Scottish Deposit Return Scheme (DRS). You only have until the end of February 2023 to register and failing to do so will mean you will not be able to sell cans and bottles in Scotland from 16 August. This includes those direct sales but also indirect sales via wholesalers, online stores and via bottle shops’ own webshops. Unfortunately again many of the details are still lacking especially over VAT and the online takeback service making it extremely difficult for breweries to begin to prepare. SIBA continues to argue vigorously for a grace period for small producers as well as fair payment terms. Again your best source of up to date information is SIBA’s own guide available on the toolbox. There’s also a video of the webinars we’ve been holding in case you couldn’t attend.

Another bombshell that landed from Scotland late last year was the consultation on restricting alcohol promotion and sponsorship. It’s an extremely wide ranging consultation and could, if fully implemented, even lead to a ban on brewery T-shirts, glasses and online promotion. SIBA will be lobbying the health minister to ensure that small breweries in Scotland are taken fully into account.

Let us hope that as the year progresses we finally get some clarity of these important issues overshadowing the industry.

Barry Watts is Head of Public Affairs and Policy at SIBA. He covers political relations and policy for SIBA members. He can be contacted at barry.watts@siba.co.uk or 07977837804.