Becuase it's the piece of legislation that extended indefinitely the wartime measure of afternoon closing, introduced to stop munitions workers getting pissed rather than working. It was in force for more than 50 years, onlt being dropped by the Licensing Act 1988.
Though that only applies to England and Wales. The situation in Scotland was different. Until th 1970s it was even worse in Scotland: closing at 10 PM and no Sunday opening, except for hotels to serve "bona fide" travellers. Then legislation was introduced to bring Scotland into line with England, but which actually made the regime much more liberal. No afternoon closing and regular extansions after 11 PM.
These are the rules for pub opening times. They were tinkered with a little over the years, but the basics were much the same until 1988. It was slightly more liberal than the DORA (Defence of the Realm Act) which regulated pub hours during WW I. But not much.
"LICENSING ACT 1921.I wonder why London got longer hours than everywhere else?
11 & 12 Geo. V. Ch. 42. Aug. 17 1921.
Past I.—-Conditions or Sale &c. of Intoxicating Liquor.
1. Permitted Hours on week-days.—(I) The hours during which intoxicating liquor may be sold or supplied on week-days in any licensed premises or club, lor consumption either on or off the premises, shall be as follows, that is to say: eight hours, beginning not earlier than 11 in the morning and ending not later than 10 at night, with a break of at least two hours after 12 (noon):
(a) in the application of this provision to the metropolis "nine" shall be substituted for "eight," and "11 at night" shall be substituted for " 10 at night" ; and
(b) The licensing justices for any licensing district outside the metropolis may by order, if satisfied that the special requirements of the district render it desirable, make, as respects their district, either or both of the following directions—
(i) that this provision shall have effect as though "eight and a half" were substituted for "eight" and "10.30 at night" were substituted for "10 at night" ; or
(ii) that this provision shall have effect as though some hour specified in the order earlier than 11, but not earlier than 9 in the morning were substituted for "11 in the morning."
Provided that, pending any decision under this sub-section, the permitted hours on week-days shall be—
(a) in the metropolis, the hours between 11.30 in the morning and 3 in the afternoon, and between 6.30 in the afternoon and 11 at night: and
(b) elsewhere, the hours between 11.30 in the morning and 3 in the afternoon, and between 6.30 in the afternoon and 10 at night.
3. Permitted hours on Sundays.—(1) The hours during which intoxicating liquor may be sold or supplied on Sundays, Christmas Day, and Good Friday in any licensed premises or club, for consumption either on or off the premises, shall he as follows, that is to say, five hours, of which not more than two shall be between 12 (noon) and 3 in the afternoon, and not more than three between 6 and 10 in the evening:
Provided that in Wales and Monmouthshire there shall be no permitted hours for licensed premises on Sundays, or on Christmas Day when it falls on a Sunday
(2) Subject to the foregoing provisions the permitted hours on Sundays shall be such as may be fixed, in the case of licensed premises by order of the licensing justices of the licensing district, and in the case of a club in accordance with the rules of the club:
Provided that, pending any decision under this sub-section, the permitted hours on Sundays, Christmas Day, and Good Friday shall be the hours between 12.30 and 2.30 in the afternoon, and the hours between 7 and 10 in the evening."
Brewers' Almanack 1922, pages 64 - 65.