Surging costs for pubs mean the price of a pint of beer is set to get more expensive, pub owners have warned.
The price of a pint could rise by 25p to 30p to cover an increase in the minimum wage, rising higher energy and food costs and the return to 20% VAT.
“We cannot absorb all these increased costs – whether it is the energy costs, whether it is food inflation, whether it is labour costs,” Clive Watson, executive chairman of the City Pub Group PLC, told BBC Radio 4 on Tuesday night.
“The only way forward for us is to put the price of food and beer up in our pubs.
“No-one wants to do that, but I reckon the price of beer would probably have to go up 25p to 30p a pint to take account of all these increased costs.
The City Pub Group owns and operates an estate of 45 premium pubs across the southern half of England and Wales, each of which is focused on appealing specifically to its local market, and a further 4 sites are in development.
Watson added: "We want to do our bit - it's very important, but at the same time we don't want everything going up the whole time, because all that will do is stoke inflation."
While the minimum wage and the minimum living rate would be "welcomed" by many staff in pubs, said Emma McClarkin, chief executive of the British Beer & Pub Association (BBPA), it also represented a further cost increase for pubs who are "still struggling to recover and face an uncertain future".
"It makes beer duty, business rates and VAT cuts in the Budget on Wednesday all the more important for the viability of our sector," she told the BBC.
The BBPA held talks with Treasury officials ahead of today's Budget, with McClarkin saying she made the case for investment in the sector in the form of fairer taxation.
“Investing in our brewers and pubs is investing in our communities and society to build back better. In return we will create jobs, boost the local economy and help our communities reconnect and unite again.
“If the Government is serious about levelling up, it must get serious about reducing the tax burdens on our sector,” she added.