Newsletter Statement re Price of a Pint

24 January 2011

Colin Neill, Chief Executive of Pubs of Ulster said:

�Pubs across Northern Ireland are currently under considerable pressure with many facing the real threat of job losses and closure. The recent increase in VAT has had a significant impact on the industry and has added a further 10 pence to the cost of a pint of beer. While many publicans may attempt to absorb the VAT rise to protect consumers, it is unlikely that this can be sustained in the long term as margins are already at untenably low levels as just 13 pence profit is currently made on a �3.00 pint of beer. This is in contrast to supermarkets which can absorb the VAT rise while selling alcohol below cost. �As well as the pressure on pubs, we are also aware that suppliers are currently facing a difficult time. Rising energy and fuel costs as well as a 60 per cent rise in the price of barley are all adding significant pressures. However, we are working closely with suppliers to try and lessen the impact these rising costs will have on publicans and their customers. �The pub industry is struggling and is in urgent need of assistance and the coalition government and the Northern Ireland Assembly need to do more to help publicans and protect consumers. The recent announcements of plans to introduce minimum pricing in England and Wales and of a consultation in Northern Ireland are welcome steps in ending the below cost sale of alcohol by supermarkets. However, with a Budget scheduled for March 2011, we do anticipate a further increase in beer duty and therefore further pressures on the industry.�