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The View From Westminster Our regular
The view from Westminster
I’m writing this from the Conservative Party Conference, where SIBA has got facetime with key decision makers including the Chancellor, the Secretary of State in Wales and Ministers. This is only days since we finally got the details of the alcohol duty system changes in the so called “mini-budget”.
There was some good news for small brewers in that announcement with the Chancellor giving his support for the SIBA ‘Make it 20’ campaign. This garnered widespread support among MPs and within Westminster and the Chancellor confirmed in his speech that the new draught duty relief would include 20 litre containers and above instead of the 40 litres first proposed. It is also very welcome to see the Chancellor freezing alcohol duty rates from February 2023, providing additional support to a struggling sector. On a less positive note, as feared there will be a delay in the introduction of the draught duty relief until next August, as opposed to February as originally planned. This will come as a disappointment to many small brewers who have already factored these changes into their business plans for next year. We are pushing for a transitional arrangement so that brewers do not have to recalculate SBR twice next year. Just before Summer, MPs held a debate on this issue and many made reference to SIBA and small brewers and the urgent need for clarity. In September, we also had a debate by Owen Thompson MP on the future of SBR which put Ministers under pressure to make an announcement. We were originally expecting the Government to publish, just before they broke up for the summer, the results of the consultation as well as draft changes to the legislation and another technical consultation on Small Producer Relief, which is replacing SBR. Combining the successful Small Breweries’ Relief, which is 20 years old this year, with Small Producer Relief is very complex and there will inevitably be winners and losers, especially the hit which will be taken by those brewers making innovative stronger products like Imperial Stouts above 8.5%. We will be working closely with the new Exchequer Secretary and Chancellor to get the details right on these changes and ensure that we continue to have a vibrant, dynamic small brewing sector fit for the future. You can read SIBA’s briefings on the new changes in the Toolbox.
We will be working closely with the new Exchequer Secretary and Chancellor to get the details right on these changes and ensure that we continue to have a vibrant, dynamic small brewing sector fit for the future.
SIBA also lobbied hard for an energy cap for businesses which culminated in the announcement in September. While welcome, there is uncertainty whether there will be further support for businesses facing rising energy costs once the initial unit price cap for non-domestic users ends after six months. SIBA is continuing to lobby hard on your behalf for clarity on this. And in addition to the cap, we’ve been calling for relief for brewers which is usually reserved for high intensive energy users such as steel. But while these things may help in the short term, it’s also important to look to the longer term. I know that many small brewers want to make the transition to Net Zero and improve their energy usage and that is why we’ve also called for meaningful grants for energy efficiency and the installation of new technology including renewable generation and CO2 recovery. While the Government has exempted business rates for green improvements, many of the Government funds available - such as the Industrial Energy Transformation Fund - are only aimed at large businesses. Grants specifically for small businesses would provide the assistance you need to make the transition to new technology. Equally there are significant challenges coming down the road from wider Government policy – which may be well meaning but add significant cost and bureaucracy for small brewers. This includes the Deposit Return Schemes (DRS) and the Extended Producer Responsibility. SIBA has full briefings available for both these issues on the Toolbox which help prepare you for their introduction and I’d recommend having a look over them if you haven’t already. The Scottish Government is determined to deliver the DRS in Scotland on 16 August 2023 and we continue to receive more and more details on how it will work and how much it will costs. While SIBA continues to lobby for changes (including to the unworkable and unfeasible online takeback service), we’re also providing the information you need to prepare. Only recently we held a webinar with Jamie Delap from Fyne Ales providing a decision tree and scenarios for your business. The excellent slides and video are also available on the Toolbox.
We are still waiting for clarity on the DRS in the rest of the UK, but it appears that Wales intends to introduce a scheme which is very different to the England and NI schemes creating additional barriers to trade across the UK. SIBA continues to argue that all the devolved administrations need to come together and agree one scheme for the whole of the UK which includes the same containers and goes live on the same date. Let us hope that the new Prime Minister and Cabinet are listening, and recognise that their economic plan needs to include the on-going help for small brewers to enable them to survive, recover and build the resilience they need for the future. As vital contributors to the local and national economy, independent breweries deserve the Government’s support.
