The Society of Independent Brewers (SIBA) and the Campaign for Real Ale (CAMRA) have jointly signed a letter to the Chancellor highlighting the challenges which they say are leaving businesses facing “grave uncertainty”.

They are calling on the Government to bring in a series of measures to help mitigate the problems – including introducing a cap on energy prices for small businesses, as well as providing grants for renewable technology to help reduce energy needs in the long-term.

The organisations have asked the Government to press ahead and prioritise these changes to help consumers, pubs and the brewing sector, but also expand the scheme to include the containers used by smaller breweries such as 20 and 30 litre casks and kegs.

Roy Allkin, chairman of the Society of Independent Brewers (SIBA), said: “With energy bills soaring, we are calling on Government to back British beer and help independent brewers with an energy price cap for small businesses, and to offer grants and incentives for the many businesses looking to brew with more green energy.

“It is also vital that the Government tempts people back to the pub with a new discounted draught duty rate for the smaller 20 and 30 litre containers used by small brewers, or risk global lager brands being the only ones who benefit.”

Nik Antona, Chairman of the Campaign for Real Ale (CAMRA), said: “Pubgoers and beer drinkers want to see urgent action from Government to make sure that the UK’s best beers, brands and breweries can survive these unprecedented times of rocketing energy and ingredient costs and a dip in consumer confidence.

“With businesses having pulled out all the stops to make it through the pandemic, it would be a travesty if more of our local, small and independent breweries were forced to close for good now due to the crisis with the cost of energy, goods, and doing business.”

The organisations have also asked the Government to pause and reflect on new regulations such as the Deposit Return Schemes which will separate the UK’s internal market for beer.

The letter to Mr Zahawi from the pair of organisations states: “Small brewers are reporting that their energy bills are doubling or trebling, putting their future ability to brew at risk.

“They are regularly reporting shortages of equipment such as kegs, CO2 and cans as well as increasing prices of raw ingredients such as grain.

“With the recent high temperatures and drought, hop harvests in Europe are expected to be down 20-40 per cent on last year, leading to higher prices and shortages in the months ahead.

“This is a time of crisis for consumers too, with many being unable to support their much-loved local pubs and brewers as much as they would like, due to the rising cost of living.

“The brewing industry was amongst the worst hit by the pandemic, relying on pubs that were closed by the Government which resulted in beer sales in pubs being down 55 per cent in 2020 and 36 per cent in 2021.

“Each small brewer came out of the pandemic with approximately £30,000 of debt which they have had to start repaying.

“We lost 160 active brewers during this period and have seen another 40-60 small brewers close already this year, with more on the brink of survival.

“The closure of small and independent breweries poses a threat to consumer choice at the bar and the diversity of high-quality brews which have made the UK’s brewing and beer scene so successful in recent years.”

The warning comes after industry bodies UK Hospitality, Night-Time Industries Association, Music Venue Trust, The British Institute of Innkeeping and The British Beer and Pub Association wrote earlier this month to Mr Zahawi, Boris Johnson and Business Secretary Kwasi Kwarteng to warn that thousands of jobs are at “grave risk”.

Businesses have seen energy prices skyrocket over the past year and, unlike consumer energy bills, there is no price cap on commercial energy costs.

Hospitality operators have claimed they are facing annual bill increases “in the region of at least 300 per cent”. It comes as soaring household bills mean that many customers are tightening their belts, placing more pressure on hospitality venues.

Kate Nicholls, chief executive of UK Hospitality, said: “Hundreds of hospitality businesses across the country are staring into an abyss of closure and possible failure, leading to thousands of job losses. It’s now or never for Government help.”

Treasury ‘supporting British brewers’

A Government spokesperson said: “We understand that people are struggling with rising prices, and while we can’t shield everyone from the global challenges we face, we're supporting British businesses and brewers to navigate the months ahead.

“We have consistently backed the industry by freezing alcohol duty at the last three Budgets, saving consumers £5.7 billion in total, increasing the Employment Allowance by £1,000 and halving business rates.

“Breweries are looking for certainty, and that is why we are fully committed to delivering our historic alcohol duty reforms, which replaces outdated rules with a common-sense approach to tax beer, wine and spirits in the same way, supports craft brewers through a new Small Producer Relief, and cuts draught beer and cider duty to inject £100 million back into pubs.”

Future of pubs and British brewery industry at risk due to energy price rises, Nadhim Zahawi warned