The £5 pint: as prices rise, so could pub closures—Labour must act now before more call last orders

24 March 2025, 16:20

By Emma McClarkin OBE

@EmmaMcClarkin

Next week, a pint of beer will become a symbol of just how hard it is for British pubs to stay open.

The price of a pint is expected to rise by as much as 21 pence, pushing the average price from £4.80 to £5.01. This price hike is a result of Budget announcements which I fear could irreparably damage a sector which supports more than a million jobs and pours billions into the economy.

At the heart of the issue is soaring new rates and taxes for one of the most highly taxed sectors that consequently makes wafer-thin profits. While the penny off a draught pint gave a welcome nod to the industry the other announcements, including slashing business rates’ relief and imposing new employment costs, leaves pubs no choice but to raise their prices in order to stay afloat.

Taken together, the total cost of the Autumn Budget's impact on the beer and pub sector is estimated to be a mind-boggling £650 million – and that doesn’t include the separate Extended Producer Responsibility (EPR) packaging reform that will come into effect in a matter of days.

The looming nightmare of EPR could cost the sector a further, staggering, £150 million. It’ll pile huge costs on brewers who only make 2p per bottle of beer and, again, these will have to be passed to the customer.

The pub industry is no stranger to adversity and has spent centuries adapting and innovating in order to survive. However, as business rates soar, employment costs rise, and packaging fees pile up, these establishments will be forced to make painful decisions.

We back Labour’s vision for growth, but we need to be given the conditions that will allow us to boost the economy. The Spring Statement provides the perfect opportunity for the Government to sow the seeds of growth that could help unlock growth and support the job market.

First and foremost, they must review of the chaotic EPR regime is critical to avoid inflicting additional financial burdens. Furthermore, a comprehensive reform of the business rates system is much needed, so the sector is treated fairly. Finally, the Government must find a way to phase in the new employment costs in a manner that doesn’t do more harm than good.

Pubs are more than just somewhere to get a pint; they are fundamental to communities to our social fabric, providing a space for connection and tackling isolation.

We urge Government to reflect on the importance of this sector and act so that the sector can carry on being a stalwart of the economy and job market. Without meaningful action, the price of a pint may not be the only thing that rises—it could be the number of pub closures, too.

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Emma McClarkin OBE, is the CEO of the British Beer and Pub Association.

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