Huge UK pub chain to hike price of beer by 4% this week in big blow to drinkers

The Sun

29-04-2025

A HUGE pub chain is hiking the price of beer by 4% this week in a big blow to drinkers.
Punters are facing yet another hike at the pumps as the UK's biggest pub chain slaps landlords with a fresh price rise.
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Stonegate Group, which owns some of Britain's best-known boozers including Slug & Lettuce, Walkabout and Popworld, is hiking beer and other booze selling prices by 4% for its leased and tenanted pubs from May 2.
Pubs will likely then have to push this cost onto drinkers, which could add an extra 15 to 20p onto drinks.
For example, a pint like Hofbräu Original Lager that typically costs £5.50, could now cost £5.75.
Similarly, the Thistly Cross Traditional Sparkling Apple Cider that would usually sell at £5, could increase to £5.20.
The move has sparked outrage among landlords, who say they're already drowning in rising costs and rent increases.
But the pub giant says it's feeling the pinch as well, with soaring energy bills, staff wages and licensing costs.
A spokesman for Stonegate said: "Our annual price review this year reflects the significant cost pressures and challenges faced by our sector over the last 12 months.
"We are absolutely committed to supporting our publicans, enabling them to continue to play the vital role in the communities they serve."
The rise lands just as the Government's controversial National Insurance hike kicked in earlier this month, hitting businesses hard.
Employers now pay NICs at 15%, up from 13.8%, and the threshold was slashed from £9,100 to £5,000 in a move that's expected to raise £25billion for the Treasury.
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The British Beer and Pub Association warned this could push the average pint price past the £5 mark, climbing from £4.80 to £5.01 with Stonegate's 4% hike only adding to the pressure.
Emma McClarkin, chief executive of the British Beer and Pub Association said: 'No one wants to see the cost of an average pint increase by a further 21p and break the £5 average pint barrier that will be required for pubs to maintain their punishingly slim profit margins.'
She added that it is 'more urgent than ever' that the Government looks at ways to cap or reduce the cost of doing business so we can keep pubs open, preserve their community value and ensure the price of a pint remains affordable.
Several chains have already put prices up to cope.
Wetherspoons has recently hiked the price of some of its drinks and meal deals by up to 30p after a warning from its boss Tim Martin.
Young's added 20p per pint, Mitchells and Butlers upped theirs by 15p, while Fuller's and Marston's hiked by 10p.
Chancellor Rachel Reeves insists the changes were put in place to protect workers, but economists say it'll be punters who end up footing the bill, with many businesses forced to pass on costs to survive.
What are employer National Insurance contributions (NICs)?
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Employer National Insurance Contributions (NICs) are effectively a tax on businesses used to cover social security benefits like Universal Credit and the state pension.
NICs are also paid by workers and the self-employed.
According to the Institute for Fiscal Studies (IFS), NICs are the UK's second-biggest tax, expected to bring in around £170billion this financial year.
Employers only pay NICs on workers' salaries from a certain threshold. This is currently £9,100 but will drop to £5,000 from April 6.
Those of state pension age or older do not have to pay NICs, but employers with workers aged 66 or older have to pay NICs on their earnings.
The increase in Alcohol duty rates back in February have also forced pubs to increase rates, passing the rise to customers.
Alcohol duty is charged on all drinks which are more than 1.2% ABV strength, either at the point of production or when they are imported.
Another blow to pubs was the new waste packaging tax introduced earlier this month.
The new tax meant products sold in glass bottles could rise by 10p, once again forcing pub owners to offset the costs onto consumers.
The moves have been branded a "perfect storm" for price hikes.
What is happening in the hospitality industry?
It's not just pubs feeling the squeeze.
The British Retail Consortium (BRC) said food prices will rise by 4.2% in the later part of this year.
Retail giants like Greggs, M&S, Currys and Next have all warned they'll have to hike prices too.
Sausage rolls at Greggs are already up from £1.25 to £1.30.
Next says the NICs hike will cost them £67million, forcing a 'reluctant' 1% price rise.
Halfords, Royal Mail, and Primark have also hinted at higher costs ahead.
Stonegate, which previously sparked backlash with its 'dynamic pricing' policy that saw pints cost more during busy periods, says it's invested over £100million in its venues, including flashy revamps like Rita's Beerhall in Leeds, to bring punters back in.
But with beer prices bubbling over and landlords threatening to quit, critics warn this latest hike could be the final nail for the great British local.
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The British Retail Consortium has predicted that the Treasury's hike to employer NICs will cost the retail sector £2.3billion.
Research by the British Chambers of Commerce shows that more than half of companies plan to raise prices by early April.
A survey of more than 4,800 firms found that 55% expect prices to increase in the next three months, up from 39% in a similar poll conducted in the latter half of 2024.
Three-quarters of companies cited the cost of employing people as their primary financial pressure.
The Centre for Retail Research (CRR) has also warned that around 17,350 retail sites are expected to shut down this year.
It comes on the back of a tough 2024 when 13,000 shops closed their doors for good, already a 28% increase on the previous year.
Professor Joshua Bamfield, director of the CRR said: "The results for 2024 show that although the outcomes for store closures overall were not as poor as in either 2020 or 2022, they are still disconcerting, with worse set to come in 2025."
Professor Bamfield has also warned of a bleak outlook for 2025, predicting that as many as 202,000 jobs could be lost in the sector.
"By increasing both the costs of running stores and the costs on each consumer's household it is highly likely that we will see retail job losses eclipse the height of the pandemic in 2020."