The damage of the smoking ban to the economy.

Here are some figures published by the British Beer and Pub Association from July 2009 on how pub closures affect the British economy, it makes grim reading.  After 4 years of the smoking ban 100,000 people have lost their jobs, and with 6,000 pubs lost since 2007 at £107,000 each the government is losing out on £650 million in taxes per year.

“Pub closures rise to record 52 a week

Pub closures up to 52 a week – more than seven a day
24,000 jobs lost in the last year
2,377 pubs close in last 12 months
Government loses over £254 million in tax in last 12 months due to pubs closing

A record 52 pubs a week are now closing in Britain, leading to the loss of 24,000 jobs in the last year, according to new figures compiled by CGA Strategy, released to today by the British Beer & Pub Association (BBPA).

The figures for the first six months of 2009 show the rate of pub closure has increased by a third, up from 39 pubs a week in the last six months of 2008. Over the last 12 months, 2,377 pubs have closed, costing 24,000 jobs. In the last 3 years a total of 5,134 pubs have closed. There are now 53,466 pubs in Britain, down from 58,600 in the year before the Licensing Act came into force.

Despite these closures and big pressures, such as additional regulation costs, the industry is also facing a double whammy on beer tax over the next few months – with the planned VAT increase in January and a further 2 per cent above inflation rise in duty in March under the Government’s beer tax escalator.”

“The recession is proving extremely tough for Britain’s pubs,” said BBPA chief executive David Long. “However, those economic pressures have been made much worse by a Government that has continued to pile on tax and regulatory burdens. The last two Budgets have seen a 20 per cent increase in beer tax, which alone has added more than £600 million to our tax bill. In addition, Government continue to press ahead with the Mandatory Code of Practice, which they say heap at least £30 million of extra red tape cost on pubs in the first year alone.
“While every other sector seems to receive a sympathetic ear and a tax payer funded handout from Government to tide them through the downturn, all we are getting is a deaf ear and a higher tax bill.”

The BBPA figures show pub closure is reducing Government tax revenues. The industry’s total tax bill now stands at £6.1 billion a year. Every pub contributes £107,000 in tax a year – 30 per cent of turnover. Pub closures over the last year have therefore cost the Government more than £254 million in lost taxes – a loss that is increasing by more than £5.5 million a week. Sector job losses are also costing the Government an additional £1.53 million a week in job seekers allowance.

“Closing pubs are not only a loss to communities, but a loss to the Treasury,” said Dr Long. “Government should look at valuing and rewarding pubs as community assets. Not only would this have social policy benefits by supporting a hub of community cohesion, but financial policy benefits in terms of tax revenues, particularly at a time when the public purse is stretched.”

The BBPA also highlights the scale of job losses in the sector, which it says is often overlooked and compares it with the furore generated by the job losses at the Mini car plant earlier this year.

“Every week, a further 461 jobs are lost in our sector. That’s more than two Mini car plants a month.” said Dr Long. “Government now needs to listen to the pub sector in the same way it listens to other sectors suffering this level of job losses. Not special treatment, just equitable treatment. As a first step, Government should commit to not increasing the cost and complexity of running a pub, by stepping back from any more tax or red-tape increases.”

Community pubs are proving the most vulnerable in the current economic downturn. Branded pubs and café style bars are actually opening at a rate of 2 a week. However community pubs are closing at the rate of 40 a week and nine traditional town circuit bars are shutting a week – five pubs a week are closing in other categories. Food seems key to some sustainability. Pubs that focus mostly on selling drink are shutting up shop at the rate of 51 a week, while those that focus more on food are closing at one a week.

Notes to Editor

1. The pub closure figures are compiled by CGA Strategy for the British Beer & Pub Association.

2. Figures are net and include new pubs that are opened.

3. Beer tax was increased in the Budget of 2008, the PBR of November 2008 and the Budget of 2009 by a total of 20%

4. The Mandatory Code of Practice is in the Police and Crime Bill which is currently proceeding through Parliament.

5. The Home Office is currently running a series of regional consultation meetings on the Mandatory Code.

6. The tax contribution of pubs is calculated on the basis of the Annual Business Inquiry, published by National Statistics. The calculations are set out in the table below.

Table: Tax Contribution of pubs
Summary based on 2007 Annual Business Inquiry (ONS), Nielsen and BBPA estimates


7. The British Beer and Pub Association is the UK’s leading organisation representing the brewing and pub sector. Its members account for 98% of the beer brewed in the UK and own nearly two thirds of Britain’s 54,000 pubs.

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8 Responses to The damage of the smoking ban to the economy.

  1. Gary K. says:

    The need(claimed) for smoking bans is based on the idea that SHS/ETS exposure causes non-smokers to die from lung cancer and heart attacks.

    The studies that ‘prove’ these claims are done using the death certificates of people that are said to have died from these diseases.

    Death Certificates showing heart attack death are wrong 33% of the time.

    Death Certificates showing cancer death are wrong 58% of the time.
    A joint report by the Royal Colleges of Pathologists Surgeons and Physicians (“The Autopsy and Audit”, 1991), says:

    “In autopsies (post-mortems) performed on patients thought to have died of malignant disease (cancer) there was only 75% agreement that malignancy was the cause of the death and in only 56% was the primary site identified correctly.”

    So if your death certificate said that you had died from cancer there, is a one in four chance(25/100) that you haven’t, and even if you have there is a 44%(33/75) chance that you’d been treated for one in the wrong place.

    25 + 33 = 58/100 error rate = 58% wrong on the death certificates.

    50% of the heart attack deaths occur out of hospital.

    Death Certificates showing out of hospital heart attack death are wrong in 41% of the time.
    Fifty-four autopsies in which the deaths were sudden and that occurred outside the hospital were retained for study.
    . The death certificate diagnosis, rendered before autopsy, was coronary artery disease in 44/54 autopsies (81%).
    At autopsy, coronary artery disease was the cause of death in 26 cases (48%),
    41%(18/44) of the death certificates stating coronary heart disease as the cause of death were wrong.

    Death certificates showing in-hospital heart attack deaths are wrong 25% of the time.
    Medicine assumes that vital statistics are accurate, but they are only as good as the death certificates.

    During the study period, 1,619 patients expired during hospitalization, of which 223 underwent autopsy.

    Concordance of myocardial infarction as the underlying cause of death between the death certificate and the autopsy was measured.
    RESULTS: The death certificate erroneously asserted the presence of an acute myocardial infarction in 9/36 cases (25% errors of commission).

    Gary K.

  2. Gary K. says:

    You can die from lung cancer while never having had lung cancer.

    A false positive diagnosis for lung cancer will lead to a Death Certificate falsely showing lung cancer as the cause of death.

    You could have had two consecutive chest X-rays that showed positive for lung cancer and still have a 93% chance of not having lung cancer.

    If you then received treatment for lung cancer and died, your Death Certificate would probably show your cause of death as being lung cancer and there is a 93% chance it would be wrong.

    Here is how it would works.
    There are about 200,000 new lung cancers per year to the about 230 million American adults. That is a rate of about 10/10,000.

    If there were 10,000 adults given X-rays, 10 would a should a true positive result for lung cancer.

    Of the 9,990 that did not have lung cancer, a 9% error rate would be 899 adults getting a false positive.

    When those 899 adults were given a second X-ray, there will be a 15% error rate and that is 135 false positives that are very certain that they have lung cancer.

    Those 135 plus the 10 that had true positives equal 145 positive results for lung cancer and 135 or 93% are false.

    Among those who received CT scans, 21% had a false positive after one scan and 33% after two scans.

    For those who received chest X-rays, 9% had a false positive after one and 15% had a false positive after two

    Lung CT Scans Produce False Alarms

  3. Iro Cyr says:

    And not a word about the smoking bans here . Funny that. You may want to post your figures pre-ban and post-ban Dave. I can no longer find these figures in my files and anyway for some reason the Huffington post does not post my comments. Either a glitch or on some kind of black list.

  4. junican says:

    It is really hard to understand how the ‘trick’ actually worked!

    Tens of thousands of publicans and others were FORCED to police the smoking ban. How did such an abomination of ‘law’ come about? Nothing makes any sense.

  5. Frank J says:

    Well, it’s certainly not justified by the data given on here to date. I keep waiting for the ‘piece de resistance’, the one that gives a clue as to why this ban was enacted. And I’m still waiting.

  6. Frank says:

    Good effort on the 16th Nov, Dave, well done.

  7. Dawn says:

    I saw somewhere that when nothing makes sense any more and stupid rules and regulations are introduced that it heralds the start of communism? Not sure how true that is but via the indoctrination of the public against smoking and smokers the powers that be now know just how powerful they really can be through what is actually a form of brainwashing imho.
    They will be happy when we are all being monitored, stuck in our own homes only purchasing and chatting through a .fully ‘monitored’ internet. This will be easy to implement due to users’ greed for internet speed which will be provided but under certain agreements. All those who disagree with a policy being pushed then can be shut up easily.
    It isn’t as easy to stop an idea that forms in conversations in real life public places with people gathering to together in pubs, so, that has to be stopped and the power of the law to stop people even smoking in their own business places has been implemented, impressive social experiment , It is all about control.
    The people because of allowing their bias and fear in have walked right into it.
    As ‘Joseph de Maistre: “Every country has the government it deserves”. Our people have become cowardly, overly materialistic and self serving.

    take care

  8. Pingback: Zyban ~ The Suicidal New Year (Re)solution to Giving Up Smoking… Permanently! | Sovereign Independent UK

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