Pubs call time on claim all-day opening would fuel drunkenness

Bars reinvented themselves as restaurants after licensing hours reform

Source: FT

Kadhim Shubber

May 20, 2015

Many pubs have reinvented themselves as restaurants, amid a fall in alcohol consumption

Many UK high streets were braced 10 years ago for a hurricane of drunkenness. The Labour government had just passed a law that let pubs in England and Wales stay open past the traditional closing time of 11pm and gave them the option of keeping the lights all night.

When the rules changed the hurricane turned out to be little more than a light breeze and, rather than turning into late-night boozers, pubs reinvented themselves as restaurants, heeding the long-term decline of alcohol consumption in the UK.

“Pubs have changed out of all recognition. They are much more part of the hospitality and tourism industry than they are part of the alcohol industry,” said Brigid Simmonds, chief executive of the British Beer and Pub Association.

The licensing changes, which Labour advertised in their 2001 election campaign with the slogan “Couldn’t give a XXXX for last orders? Vote Labour on Thursday for extra time”, let pub landlords serve beer 24 hours a day if they wanted.

In practice, according to a report published on Wednesday by the Institute of Economic Affairs, a right-leaning think-tank, pubs have kept the booze flowing for an average of just 21 minutes more.

Instead, they have focused on food as a source of growth in an industry where beer sales have fallen every year for more than a decade, says Will Brumby, an analyst at Langdon Capital.

“People are drinking less, which is why most [pubs] are becoming more like restaurants,” he said.

Between 2004, just before the changes were introduced, and 2013, consumption of alcohol per head in the UK fell 19 per cent, according to HM Revenue & Customs – from 9.5 litres to 7.7 litres a year.

The long-term decline outweighs the benefits of longer opening times, according to Christopher Snowdon, who wrote the think-tank report.

“[Pubs] can make a little more profit when demand is there but the fundamental problem is a deficit of demand generally,” said Mr Snowdon, noting that the data suggest that today’s young people are “the most clean-living generation for quite some time”.

The proportion of young adults drinking frequently has fallen more than two-thirds since 2005, according to Office for National Statistics figures published in February.

When the Chesham Arms pub reopens at the end of June, it will mark the end of a battle by regulars that highlights a planning dilemma facing the government.

Student bar operator Eclectic Bar Group felt the effect of that clean living last month, blaming an 88 per cent fall in half-year profits on, among other things, students eschewing heavy boozing during the first weeks of university.

JD Wetherspoon, the cut-price pub chain that increasingly competes with cafés, typically keeps its pubs open until midnight, extending the opening hours until 1am on Fridays and Saturday.

But chairman Tim Martin is dismissive about the impact of the extra hour or two of trading a day, compared with other trends affecting the industry.

“Any hypothesis based on the fact that pubs have benefited from this and people are out drinking late at night can’t be true,” he said, pointing to thousands of pub closures over the past 15 years.

More than 12,000 UK pubs have shut since 2002, bringing the total down to fewer than 48,000, according to the British Beer and Pub Association.

“Pubs have lost massive amounts of trade to supermarkets,” Mr Martin said. “Any late-night drinking that’s going on is going on at home.”