Raise a glass to Harry and Meghan

16 May 2018. Published by Matthew Plampton, Trainee Solicitor

Pub licensing hours across England and Wales will be extended on the weekend of the Royal wedding. This will undoubtedly provide a much needed boost to the British beer and pub sector. However, what has caused the traditional British pub's decline and how can the sector be turned around?

Time to celebrate

The former Home Secretary Amber Rudd declared the Royal wedding as an opportunity for the country to 'join together and celebrate' and 'raise a glass to Prince Harry and Meghan Markle on a day of celebration'. Consequently, Section 172 of the Licensing Act was invoked after a four week consultation, and pubs across England and Wales will now be able to stay open until 1.00am on both nights of Friday 18 and Saturday 19 May.

The British Beer & Pub Association has estimated that the extended trading hours could deliver a £10m sales boost to English and Welsh pubs (or roughly an extra 2.8 million pints of beer if we use the average UK price). The boost will come from visitors who see the British pub as a cultural icon, as well as the British public themselves taking advantage of those extra drinking hours.

The decline of the British pub

However, as great as the boost may be, it is merely short term, and does not cover up the long and rapid decline that has been seen in the UK pub sector. Since 2000 the number of UK pubs has fallen by 17%, or more strikingly 10,500 pubs. The trend is still continuing as it was reported in February of this year that 616 pubs have disappeared since April 2017, equating to roughly two a day. Although an improvement from the 2014 figures where pubs were closing at a rate of 29 per week, the sector is far from 'strong and stable'.

Multiple reasons are given for the decline including the smoking ban, the 2008 recession and increased taxes. The Government has attempted to tackle this with the recent £1,000 business rate relief for pubs being extended until March 2019. Similarly, a duty freeze on beer, wine and spirits was confirmed in the Autumn Budget. Although these provide a much needed tax break to the pub sector, it still fails to identify and tackle the underlying issues that have caused fewer of us to visit the local pub.

This decline stems from a cultural shift in the way the UK population buys and consumes alcohol. Since 2000, supermarket sales of beer have increased by 27%; resultantly reducing the amount of beer purchased in pubs. Furthermore, a study by the Institute of Alcohol Studies found that affordability of wine and spirits in supermarkets has improved by 131%, whereas the prices in pubs have risen steadily. This is further exacerbated by the fact that adults are drinking less. The ONS has reported that in the last decade there has been a 2% increase in those describing themselves as teetotal.

The solution

As a result, we are left with a population that drinks less and prefers to buy alcohol more affordably at supermarkets. Nevertheless, it is wrong to merely accept that the knell should start being rung on the British pub industry, as these businesses can still be turned around into profitable enterprises. The focus has to be on removing the dated image of the traditional pub, and making it a more accessible space to a broader demographic.

City Pub Group reported a 3.8% increase on like-for-like sales during 2017 and The Seafood Pub Company reported a 22% turnover increase in 2016. Both of these pub chains focus on quality local food and creating independent venues. Furthermore, working with the rapidly increasing sector of craft breweries and distilleries has proved an effective tool, as pubs are able to offer a more unique product that can't be bought in the supermarket.

Although the pub sector might be not as profitable as it once was, there is still hope that this traditional icon of British culture can be maintained in the long term. For now, the sector will have to hope that multiple glasses are raised to celebrate the wedding of Prince Harry and Meghan Markle.