Beer starts to shake off recession slump
28.01.2010
• Total beer sales down 3.6 per cent
• Pub beer sales down 5.0 per cent
• Supermarket and off-licence beer sales fall by 2.1 per cent
• 2009 estimated Government beer tax revenues down £258 million on 2008
UK beer sales show signs of lifting out of the recessionary slump as 2009 fourth quarter results show the lowest fall for two years.
The British Beer & Pub Association’s (BBPA) latest UK Quarterly Beer Barometer shows that total sales – pubs and supermarkets – for the last three months of 2009 fell by 3.6 per cent, the lowest fourth quarter fall since 2006. Sales for the whole of 2009 fell by 4.2 per cent, compared with 5.5 per cent in 2008.
Sales in pubs, bars and restaurants were down 5 per cent in the final three months of 2009 compared with the same period in 2008 – the lowest final quarter fall since 2006. Sales for the whole of 2009 were down 5.2 per cent – an improvement on the 9.3 per cent slump in 2008 and 6.5 per cent fall in 2007.
Beer sales in supermarkets and shops declined by 2.1 per cent in the final three months of 2009, compared to a fall of 6.4 per cent in the same period in 2008. In the year as a whole, however, off-trade sales fell by 3.1 per cent – the largest fall since records began in 1978.
Despite signs of stabilisation within the sector, these declines are still having a significant effect on Government revenues. Income from beer tax in 2009 is down £258 million compared with 2008, despite duty rates being considerably higher.
Brigid Simmonds, BBPA Chief Executive, comments:
“These figures show a sector starting to claw its way out of a recessionary slump.
“They also signal the most significant driver of problems in the pub sector over the last 12 to 18 months has been the down turn in the economy and the slide into recession, along with duty increases of over 20 per cent. As the economy moves into recovery, so will the beer and pub sector. In fact, as in previous recessions, it may emerge first and fastest.
“However, it’s too early to say whether these indicators of fragile recovery will turn into a trend, particularly when we await to see the impact of shocks such as the VAT increase and big freeze of this month.
“What is certain is that any recovery could be thrown off course an destabilised by Government intervention on tax or regulation. What is equally certain is that any move by Government to increase beer tax further this year would be very damaging and place pubs and jobs at greater risk.”
Notes to Editor
1. The British Beer and Pub Association is the UK’s leading organisation representing the brewing and pub sector. Its members account for 98 per cent of the beer brewed in the UK and own nearly two thirds of Britain’s 54,000 pubs.
2. The BBPA has a long-established and authoritative reputation for the publication of statistics on the UK’s brewing and pub sector. The BBPA’s Beer Barometer, published for the first time in July 2008, will generally be available within one month of quarter-end. Data is sourced directly from the Association’s brewing members, and accounts for 95 per cent of all beer, sold in the UK.
3. Beer duty was increased by 2 per cent in the April 2009 Budget. In the previous year there was a 9.1 per cent increase in the Budget in March 2008, and a further increase in beer duty of 8.0 per cent was announced in the Pre-Budget Report in November 2008. The total increase since March 2008 is 20.1 per cent – a tax increase of £600 million.
5. Tax revenue figures are based on HMRC duty revenues. HMRC data shows that in 2008 the Treasury raised £3,154 million in beer duty revenue, as well as £2,456 million in VAT from beer sales. In the 2009 the Treasury raised £3,218 million in beer duty revenue, and £2,134 million in VAT from beer sales, a fall in revenue of £258 million.
6. UK Quarterly Beer Barometer tables follow, which are also available in Excel format on the BBPA website via the link above.
7. Further to the data available with this press release more detailed data is available to purchase from the BBPA. This includes a more detailed look at category performance and monthly breakdowns. For information about the data that BBPA sells please contact David Sheen - dsheen@beerandpub.com
For further information contact:
Mark Hastings
Director of Communications
mhastings@beerandpub.com
Tel: 020 7627 9151 / 07784 181794