“Wine businesses like those here today have been able to weather the events of the last few years, not because of what the government has done to help them, but in spite of the obstacles the government has put in their path,” said Miles Beale, chief executive of the Wine & Spirit Trade Association.
Speaking at London Wine Fair 2023, Beale discussed the recent “failure” of the UK government to support the wine and spirits industry throughout the past 12 months, while also neglecting the needs of the trade during turbulent times.
Beale cited “increased energy costs, double digit inflation, rising interest rates, weak sterling and a cost-of-living crisis for consumers,” as some of the biggest challenges the drinks industry is experiencing, while also hailing the trade for its continued resilience in the face of such difficulties.
However, Beale then went on to highlight the “failure of our government to support this industry”, particularly in light of excise duty rises which are due to come into effect on August 1 2023.
Noting that all alcohol duties will be subject to a 10.1% increase (up from previously proposed rates), Beale condemned the duty increase, which will “drive inflation” while creating further disparities between different sectors in the industry.
“Far from levelling the competitive playing field, the government has reinforced the current distortions. How is it economically rational for wine and spirits to pay 50% more duty for the same amount of alcohol than beer; and more than three times the rate levied on cider under the new regime?” he said.
Turning to wine in particular, Beale mentioned still and fortified as two categories that will be most affected by duty rises: “Duty on most still wine [will go] up from £2.23 a bottle to £2.67, duty on a bottle of Fino Sherry up by almost £1 and duty on a 20% Port up by £1.30 a bottle.”
“The new system will be deliberately unfair, more so for wine than any other product,” Beale said, describing the hikes as both “impractical” and less “economically rational”.
Elsewhere, Beale urged the government to conduct a “radical reform” of the UK’s Packaging Recycling Notes (PRNs) system in order to maximise the collection and recycling packaging waste.
“Businesses cannot make financial plans when the price of PRNs can vary so much – as much as ten times year on year,” he said, adding: “We have made frequent requests that government takes urgent action and the government refuses to listen. Or listens then refuses to act.”
On the topic of packaging, Beale addressed the “ongoing tragedy that is the introduction of a Deposit Return Scheme (DRS) in Scotland.”
While the WSTA welcomed the decision to delay the introduction of the scheme until 2024, Beale criticised the Scottish scheme for being “driven by political dogma rather than environmental outcome”.
“Across multiple policy areas – and different parts of the UK – we repeatedly see unlistening government trying to roll out politics-led, evidence-free policy to produce impractical, untenable or downright unworkable interventions that ramp up prices for punters in a cost-of-living crisis and increase costs for the SME-rich UK wine industry.”
Coming to a conclusion, Beale praised the wine industry for its ongoing strength, while urging the government to take the “time to understand and then work with the industry concerned.”
“We have the most amazing, diverse wine sector in the UK – one that is to be celebrated. But government has to do better. It has failed the wine sector in recent times, but it’s not too late.
“As a sector, you have to continue to be resilient. As the WSTA, we will continue to represent you, to say it like it is. But government has to change tack and pull its socks up.
“And that’s not just a message for this government. It’s advice, a request – and a warning to the next.”