Truman and Snowden's 1931 Budget

Yet another post I've managed to squeeze out of that single document. And I'm still not finished wringing. Not even had to use the mangle yet.

You should all be well aware of Snowden's 1931 emergency Budget. I keep going on about it enough. It was one of the most cataclysmic events in recent British brewing history. And about the only one which didn't take place in wartime. Its effect on British beer - a further lowering of gravities - was permanent.

Document B/THB/C/256c has some figures which highlight wonderfully the Budget's effect. There was an immediate drop in beer production. By 1933, the number of bulk barrels produced was down by more than 25% compared to 1929. But the impact in the number standard barrels* produced was even greater - a reduction by a third. Bad news for the government because the tax was charged on standard barrels.

Why the discrepancy between standard and bulk barrels? Because brewers lowered gravities to reduce their tax bills. This pushed average OG down below 1040. The net result was that even though the tax rate had increased by 42.5% (from 80 to 134 shillings) the amount of revenue collected fell.

By the time the increase was removed the damage was done. And the revenue collected fell even further, hitting its nadir in 1935 at 75% of its 1929 level.

Here's all that information in an tabley numbery form:

UK output and tax paid
year	standard barrels -6%	%	bulk barrels -6%	%	duty payable	%	average gravity
1929	19,252,986	100	24,350,155	100	£70,846,978	100	1043.21
1930	19,550,867	101.5	24,984,168	101.3	£71,254,674	100.5	1043.05
1931	18,488,400	96	23,780,784	96.9	£69,269,299	97.7	1042.69
1932	15,514,209	80.6	20,675,383	84.3	£68,710,020	97	1041.19
1933	12,898,594	67	17,843,579	72.7	£67,097,581	94.7	1039.69
1934	15,043,120	78.1	20,182,308	82.2	£53,884,405	76	1040.99
1935	15,577,830	80.9	20,804,814	85	£53,582,335	75.6	1041.06
1936	16,356,985	85.1	21,969,763	89.6	£55,451,926	78.3	1041.02
1937	16,983,231	88.2	22,724,450	92.6	£57,318,585	80.9	1041.1
1938	18,055,539	93.8	24,205,631	98.6	£61,241,404	86.4	1041.02
1939	18,364,156	95.4	24,674,942	100.6	£62,370,034	88	1040.93
Source:
Document B/THB/C/256c held at the London Metropolitan Archives

Why are they giving the numbers minus 6%? Because brewers were allowed a wastage of 6%. Tax was payable on the amount of wort that went into the fermenters, minus 6%. That's where larger brewers had an advantage as their loss was less than 5%, meaning they paid no tax on some of the beer they sold.

These are the equivalent numbers for Truman. You can see that things panned out slightly differently for them:

Truman (including Russells) output and tax paid
year	standard barrels -6%	%	bulk barrels -6%	%	duty payable	%	average gravity
1929	424,671	100	523,828	100	£1,600,838	100	1044.59
1930	449,373	105.8	558,898	106.7	£1,687,954	105.4	1044.22
1931	429,788	101.2	536,544	102.4	£1,673,738	104.5	1044.06
1932	346,549	81.6	460,534	87.9	£1,575,574	98.4	1041.39
1933	278,252	65.5	398,852	76.1	£1,465,428	91.5	1038.37
1934	333,364	78.5	454,587	86.8	£1,182,116	73.8	1040.33
1935	343,842	81	471,946	90.1	£1,183,347	73.9	1040.07
1936	359,492	84.6	493,712	94.2	£1,236,822	77.2	1040.04
1937	369,115	86.92	507,091	96.81	£1,269,215	79.3	1040.03
1938	373,459	87.9	518,762	99	£1,276,433	79.7	1039.59
1939	371,728	87.3	519,831	99.2	£1,264,241	78.9	1039.33
1940	370,528	87.3	522,691	99.8	£1,534,821	95.9	1038.99
Source:
Document B/THB/C/256c held at the London Metropolitan Archives

1930 to 1932 they did slightly better than the industry as a whole, even increasing output in 1931. After 1936, bulk numbers were almost back to their 1929 level, though standard barrel numbers lagged behind and were lower than average. This is explained by the other difference with the national picture: Truman's average gravity was lower.

It had taken the industry the remainder of the 1930's to get back to where it had been in 1929. And what happened just when everything was getting sorted out? WW II. Which completely buggered things up again.

In the first half of the 20th century the brewing industry was perpetually in turmoil, all of it caused by external factors. There was the 1911 Budget, WW I, the 1931 Budget then WW II. No wonder so many family-owned breweries were happy to sell up in the 1950's.





* A standard barrel is 36 Imperial gallons with an OG of 1055.