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Alcohol Duty Review
| 14 June, 2022
Resilience, Resistance and Recovery
So pleased to see you all here today – it’s great to be back at Olympia and to be meeting in person and also to see so many familiar faces among you. I hope we can catch up over the next few days. It’s been far too long…
Three parts to this morning’s session. I’ll start with what’s increasingly becoming a tradition for me at the London Wine Fair, and that’s a look back over the last twelve months or so and then a look ahead to some of the challenges and opportunities facing the sector – or at least the ones we know about!
Then a second part: your ‘BOGOF’ offer if you like… David Richardson, Regulatory & Commercial Affairs Director at the WSTA, who will outline the results of some WSTA research into the experience of businesses moving goods to and from the EU post-Brexit and any lessons learned.
And then we are going to raise your BOGOF to a 3-for-the-price-of-1! Simon Stannard, WSTA Director of Policy will join David and me for a Q&A session. Please get thinking of questions – and I hope between us we’ll be able to answer them… just as we have been doing every fortnight since shortly after Covid began!
But first a look back over the last 12 months and a look at what’s coming over the horizon. And I’ve subtitled my speech resilience, resistance and recovery – I hope all will become clearer why in the next 20 minutes or so.
I am really looking forward to reflecting on how well our sector has weathered the storms of the last few years and, finally, after years of disruption, is sitting back and basking confidently in the sunny uplands that is the post-Brexit trading environment… Regrettably that is not today’s speech! The promised sunny uplands look some way off and so that speech will have to wait for a future Wine Fair. Instead, I’ll be reflecting on the resilience of the wine trade to have weathered both Brexit and COVID over the last couple of years and survived. I’ll also highlight some WSTA success along the way. And then look to the significant challenges that lie ahead.
And I don’t want to sound downbeat, because we have much to celebrate as a sector as we get together in person for the first time since 2019. As we celebrate our resilience and some success, it is important to recognise that uncertain times lie ahead. But if we – or rather, if you – have demonstrated anything over the last few years it’s that this wonderful, vibrant sector is resilient. It’s had to be. And, for an industry that’s built on tradition, it’s shown itself to be remarkably fleet-of-foot of late. Whether that’s an accelerated shift towards online retailing or adjusting to a new trading environment and new procedures and paperwork (more on that from David later).
And that’s not to minimise the experience of the last two years. It’s been incredibly tough for many, especially for those that supply into the hospitality sector, which were not given access to the same degree of Government support as businesses in the hospitality front line. This time last year the hospitality sector was only just beginning to open up. One year on, there are tentative signs that sales patterns are returning to pre-COVID levels with a more familiar balance between on and off trade sales. Fingers crossed that resilience is giving way to recovery – and that this continues and is boosted by the Jubilee celebrations, a summer free of restrictions and an Autumn World Cup. But also that it endures beyond the summer and into what threatens to be a much tougher autumn and winter.
And despite the challenges of the last year and more, helping WSTA members navigate what at times seems like and ever-changing trading landscape, I am immensely proud of what the WSTA has managed to achieve for our sector.
Top of that list has to be our efforts in convincing the Government to do away with costly and unnecessary wine import certificates – the now infamous VI-1 forms. We estimate this has saved about £70 million for both those non-EU countries that used to have to complete import certificates and for EU imports into the UK where it wasn’t necessary to introduce the new simplified certificate provided for in the UK/EU Trade & Cooperation Agreement (TCA).
I am pleased that government – in this case, Defra – was prepared to listen to the unified voice coming from the sector that advocated scrapping VI-1s. In the event the Government had little choice but to do the sensible thing and get rid of them. A single voice on behalf of a unified industry and a listening government prepared to act was a powerful and transformative partnership. [Take a bow, VP. Let’s have another round or two of that please!]
And the Government – or parts of the UK’s Governments – have listened to the industry and, at least as far as England and Northern Ireland are concerned, has been listening and has agreed not to include glass bottles in any deposit and return scheme to be rolled out in 2024. The WSTA was for some time been almost a lone voice in arguing against including glass in any deposit and return scheme. I am delighted we were able to convince Governments in Westminster and Belfast to think again. [And, come to think of it, we have had to persuade a few in the industry as well…] So resistance and resilience important to allowing recovery to take root.
Let me be clear though – the WSTA is not against the principle that those that put waste packaging on the market should pay for its collection and recycling. On the contrary we think it is only fair. Our concern has long been that if industry is being asked to pick up the tab, then any system must offer the best value for money. With glass recycling rates already in the high 70 per cents (87% in Wales!) – it makes no sense to introduce a completely new scheme aimed at increasing the recycling rates by less than 10%. Instead far better to look at ways to increase the existing recycling rates by building on the existing infrastructure.
And – like Vi1s – Deposit and Return Scheme design is another example of where a listening government working with a concerted, informed and united industry could reap rewards for all parties – literally in this case, given all 4 parts of the UK are now led by 4 different political parties. From resistance to recovery…