It is a pleasure to speak in the debate. I join in the congratulations to my hon. Friend the Member for Nuneaton (Mr Jones) on securing it. We have spent much of the past year working together on beer, as we both took part in the all-party beer group’s inquiry into the smuggling of beer to try to get round the UK duty rules. That issue has not yet
been raised much in this debate. One reason why we do not get the increase in revenue that we would expect from the beer duty escalator is the increasing amounts of beer that are brought over in what we could euphemistically call white vans. I suspect that they are actually large trucks, sneaking through our border, so that the beer can be sold round the backs of industrial estates.
It was quite scary, when we took evidence from Her Majesty’s Revenue and Customs, to hear exactly what the scale of the fraud was. It was something like the equivalent of all off-sales sold outside supermarkets in the UK, which is a seriously large volume. I am not saying that every small shop selling beer is selling non-duty-paid beer; that was just to show the scale of the problem that we have. We have to consider whether, all other things being equal, a policy that just generates extra rewards for people smuggling and avoiding beer duty is sensible when we are trying to encourage the legal trade.
I agree with what everyone else has said. I think that everyone has used the useful statistics that we have for the debate. The idea of increasing beer duty by more than inflation every year was probably wrong when it was introduced four or five years ago. In fact, various members of my party and the Liberal Democrats said at the time that it was wrong. It is a pity that taking on the chains of office means that we change our mind on some of these things.
It was intriguing to see that the present Secretary of State for Health was not happy with the policy when he was in a shadow role five years ago. I hope that that is something that my right hon. Friend has taken with him into the Department of Health and that we can see a reduction in the rather scatter-gun and unfair efforts to stop ordinary, reasonable people having an ordinary small amount of drink every week. It is right that we tackle excessive drinking, but we should not be trying to tackle the ordinary drinker and push the cost up for them.
If we are trying to tackle excessive alcohol consumption, which we clearly should, it is important to point out that the beer duty escalator targets people who drink, in pubs, pints of British-brewed beer. I suspect that that is not the biggest health problem caused by alcohol that this country has. We should be encouraging people to drink a nice, relatively weak pint of beer, rather than sitting at home drinking a litre of spirits or whatever. That is the direction of travel we should be looking at—encouraging the supervised drinking of British-brewed products in pubs and discouraging the drinking of imported cheap spirits.
I am not convinced by the arguments for the health benefits of this policy and I am probably even less convinced of its economic advantages. The forecast in the Red Book last year showed that the expected increases in this Budget would not actually raise any more money. I accept, and I will happily make the argument, that we are pretty desperate for revenue to reduce our deficit, but it seems bizarre that a policy would be introduced that raises no money and actually does damage to a pretty important industry that is a significant employer throughout the country. While I am on that issue, I should join the list of hon. Members praising their
small local breweries. I can think of a fair few—Amber Ales, Leadmill, Bottle Brook, Coppice Side and Marlpool. I have to say that I think I have drunk quite a lot of all their beer. I made a special effort to have a barrel of beer from the Marlpool brewery at my engagement party a few weeks ago, which went down very well, so I am happy to say that I will do my bit to support my local brewery trade.
We can see that the number of these breweries is growing every year. Every time we drive round an industrial estate, we find that a new brewery has sneaked up round the corner. We should be supporting this trade. We should be supporting our pubs. They generate employment and they provide a community facility that we value. Therefore, I do not believe that the original case for increasing beer duty by more than inflation holds water any more. We should at the very least be stopping that above-inflation increase. I can see the argument that all other costs go up by inflation, so why should not the duty element? I cannot see the argument for putting it up by RPI plus 2%.
I would happily agree with all the other hon. Members who would say that beer duty is too high now and it is doing great damage. We have had a 42% increase in beer duty in the past four years. We have had enough. Let us try to support people and freeze it. If the Government cannot quite go that far, let us at least announce in two weeks’ time that we are scrapping the escalator and we will have to deal only with inflationary rises each year. That would at least be a fair situation from which to go forward.
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