Tuesday, 23 August 2016

Drinkers want cheaper not stronger beer

Cripps budget in April 1950 didn’t please everyone. The tax on beer was cut, but the government forced brewers to increase the strength of beer rather than reduce the price.

I’m not sure why the government didn’t want the price to fall. That’s certainly what those in the trade wanted. And I can understand why. But I’ll let someone with personal experience explain:

Sir Stafford Cripps is out of touch with public opinion, says Mr. G. B. Green, President of the Cheltenham Licensed Victuallers' Association.

"The public want a cheaper, not a stronger beer. The three per cent gravity increase is just a 'sweetener.'

"We licensees are very grieved that there has been no reduction in price. We had quite expected it.

"I think the public generally is quite satisfied with the beer at present on the market. It's a good, honest beer.

"But— it's too expensive."

Brewing of the new Cripps special stronger beer will begin at the Cheltenham and Hereford Breweries "in the next day or two."

Mr. N. H. R. Wardle, manager of the Brewery, told the "Echo" to-day that it was not possible to say how soon the higher gravity beer would be available to the consumer.

Bottled beer, he explained. required up to three weeks' conditioning; draught beer, about a week.

Complicated instructions concerning the brewing of the stronger beer were received by the Brewery from the Customs and Excise authorities during the morning.

Commenting on Sir Stafford's Budget decision to increase the gravity of beer instead of making any alteration in the price, Mr. Wardle said:

"We are sorry that the Chancellor has not considered it possible to lower the duty on beer, but at the same time we feel that the public will appreciate a stronger beer for the same money.

"But I doubt if the new strength will do anything to increase sales.

"There is lot of disappointment among licensees who had hoped for a price reduction which would arrest the present decline trade." ,
Gloucestershire Echo - Wednesday 19 April 1950, page 1.

A small increase in strength was likely to have marginal impact on demand for beer. While a decrease in price almost certainly would have increased sales. And revenue to the government. Which makes their decision to increase beer gravity even stranger.

Here’s what the changes meant in terms of tax and gravity:

Ordinary Mild

old rate new rate
tax per standard barrel 4120.5 3852 3852 3852
OG 1030 1030 1032 1033
tax per 36-gallon barrel 2247.55 2101.09 2241.16 2311.2
tax per pint 7.80 7.30 7.78 8.03

Ordinary Bitter
old rate new rate
tax per standard barrel 4120.5 3852 3852 3852
OG 1035 1035 1037 1038
tax per 36-gallon barrel 2622.14 2451.27 2591.35 2661.38
tax per pint 9.10 8.51 9.00 9.24

The tax cut amounted to about 0.5d per pint on Ordinary Mild and Bitter. An increase in gravity by 3º left breweries slightly out of pocket, if they continued to sell the beer at the same price.

Note what a huge percentage of the retail price the tax amounted to. At this time a pint of Mild retailed for about 13d per pint, Ordinary Bitter 15d. Doesn’t leave a huge margin for either brewer or publican.

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