Finance (No. 2) Bill

Paul Holmes Excerpts

Committee of the whole House
Tuesday 13th January 2026 Commons Chamber

[Mike Wood]

It is a genuine pleasure to follow the hon. Member for Burton and Uttoxeter (Jacob Collier), who made some excellent points. Before I begin, I will disclose that although I do not have any relevant interests to the debate in the Register of Members’ Financial Interests, I have received hospitality below the threshold from UKHospitality, the British Beer and Pub Association, CAMRA and the British Institute of Innkeeping; there may be others.

People up and down the country may be justified in asking what the Government have against pubs. Many things are causing so many pubs to struggle and to question whether they can survive beyond the very short term—the enormous increases in business rates, the increases in employer national insurance that particularly hit those who employ part-time workers, and the ever-growing burden of regulation, not least in the Employment Rights Act 2025, that affects many pubs and hospitality venues—but I think that this clause in the Bill really sums it up,

The Government did have a choice. The Chancellor could have built on a success of the previous Conservative Government—in fairness to her, she actually did so last year—by reducing that draught duty rate so that duty on beer and cider sold on draught in pubs was paid at a lower rate, perhaps at the same time as extending the differential with supermarkets and off-sales that might be sold at or below cost price. But she chose not to do that; she chose to increase duty on top of all the extra burdens that are threatening the survival of our community pubs, bars and other hospitality venues. By increasing duty by RPI rather than the lower rate of CPI, the Chancellor is threatening to return us to the bad old days of the previous Labour Government’s hated beer duty escalator, under which the duty rate increased year after year.

I think the hon. Member for Birmingham Northfield (Laurence Turner) suggested that this measure is somehow in keeping with the policy of successive Governments, but nothing could be further from the truth. In just 19 months, the Government will have increased beer duty by more than it went up in the 12 years running up to the last general election. This is a massive increase in duty in a short period. Indeed, the duty paid on a pint in a pub was actually lower in July 2024 than it had been 12 years earlier because of policy decisions made by Conservative chancellors.

[Paul Holmes (Hamble Valley) (Con)]

I am sure that, like me, my hon. Friend has been to quite a few pubs in his constituency. Many of my publicans are saying that because of the decisions the Government are making, they have a choice, which is to try to get more customers or to lay off staff. This is affecting pubs who are busy—pubs at their capacity are now really worried about whether they will be able to survive another year. Has he heard that from his local publicans?

[Mike Wood]

My hon. Friend is right, although that is not really a choice that many pubs are able to make, because it is taken for them. We saw the same thing when the previous Labour Government’s beer duty escalator was in force. We know that increases in alcohol duties have a minimal impact on overall alcohol consumption, but they do have an impact on how people drink and what they drink.

Higher alcohol duties lead to a shift from people consuming alcohol in well regulated, licensed premises like a community pub—where they will typically drink medium-strength beer and cider—to people drinking more stronger alcohol at home without the protective framework of a licensed pub. That makes no sense on either a social and health or an economic and community basis. It is the wrong thing to do yet again. It is yet another burden that our overstretched pubs and hospitality venues simply cannot afford. It is the wrong thing to do and that is why, as well as supporting our own new clause and opposing the clause, I will certainly support the new clauses tabled by the Liberal Democrats. There is a better alternative.