A Meeting with Timothy Taylor's
A little summary for those of you reading this who are not familiar with a recent Government announcement, which is set to effect the beer industry.
A month ago, the Treasury announced a plan to change Small Brewer's Relief (SBR). SBR is a scheme that offers smaller breweries a discount on their duty payments. For those breweries brewing under 5,000HL per year, they receive full 50% relief. The relief then tapers from full to no relief between 5,000HL and 60,000HL.
The proposed changes are to introduce the tapering level from 2,100HL instead, bringing in new cost and growth challenges to those amongst the smallest of our breweries.
SBR changes has been supported by a coalition of breweries, including Timothy Taylor's. CEO Tim Dewey put out THIS statement after the announcement and I co-signed THIS letter response. Tim replied and on 26th August (today), we met with him here at Nomadic Beers to discuss things further.
We had a good two hour chat with Tim today and whilst SBR was intended as the main topic of conversation, we actually ended up chatting about a broad range of subjects impacting our industry today.
Despite our differing views on this particular SBR related issue, we agreed on most other things. There were a lot of common views and concerns and I felt that, rather than seeing Timothy Taylor's as a "villain" in this piece, we really ought to be working together.
Tim was a good listener, attentive to our concerns, articulate in his responses and not shy in offering his opinion and experiences. It was a really useful conversation for us and I hope Tim feels the same; we intend to keep in contact as things develop.
The main thing we agreed on is that SBR itself is a flawed system. What was once an answer to economy of scale issues is now being used as a sticking plaster; moved and re-sized as needed to try and cover up the fundamental problems the industry is facing.
The conclusions and actions I drew from the meeting are (this is my opinion, not Tim's or representative of Nomadic Beers):
Beer duty in the UK is too high, even with full SBR, breweries are still paying more per pint in duty than most other European countries.
The route to market is difficult, even breweries like Timothy Taylor's feel that, but it is exacerbated for small breweries.
Pub ties are damaging, both for market access and consumer choice, this needs to change
Major pub chains and intermediaries (supported by some breweries!) are grossly devaluing cask ale by turning it into a low value commodity. Cask ale is the pinnacle of brewing in the UK; the price major chain pubs and other intermediaries pay for this should reflect it's premium nature.
Not something we specifically discussed, but supermarket pricing of beer is a significant challenge for breweries and pubs
Fix 1 and 2, there should in theory be no need for SBR at all (I get there is more complexity to this, but as a fundamental principle I think it's right)
The splintering off of breweries away from the major industry body representing them (whether that body is best placed to do that now or not) is going to cause long term issues and build factions in dispute over common issues
We need to all talk a lot more and not make snap judgements/decisions (I am guilty of this!)
On this basis, then, I've decided that although I will continue to campaign against the proposed changes, I need to spend much more of my time and energy campaigning on the fundamental changes that will make SBR a moot point.
I have also lifted my self imposed ban on drinking Timothy Taylor's beers. Despite Tim not really adjusting his position on this specific SBR topic, our fundamental industry goals are the same and I feel our efforts are best served working together, even if we differ on this one issue.
Finally, I'd like to thank Tim for being so willing to chat to us about this, for his frank views and open ears. I look forward to how we can continue to work together to improve this industry for the future.