Ireland: Diageo announces new 6% price increase on its products
The price of a pint in Ireland is set to climb by about 10 cent from the middle of next month – and while Diageo described the increase as necessary to “maintain a sustainable business”, publicans have condemned it as a “hammer blow” to the sector, the Irish Times reported on March 26.
A 6 cent increase on Diageo products including Guinness, Carlsberg and Smithwick’s will take effect from April 15th, but will come to almost 10 cent when tax is included. It comes on the back of a 12 cent price hike the drinks giant rolled out this time last year.
According to figures from the Central Statistics Office, the average price of a pint of stout in Ireland last November was €5.62, while lager cost €6.06, although prices vary wildly across the State, with some pubs in urban centres charging close to – and sometimes even beyond – €10 for a pint.
“Like many, we continue to face increased costs across our business – we have kept these increases to a minimum, but it is required for us to maintain a sustainable business for the future,” a Diageo spokeswoman said.
Publicans have reacted angrily to the latest price move, with the Vintners’ Federation of Ireland (VFI) saying the decision “is the latest hammer blow to the pub trade and underlines the need for Government to introduce further supports for a sector experiencing unprecedented costs pressures”.
The umbrella group’s chief executive Pat Crotty said the announcement was “not just disappointing, it’s a critical hit to an industry on the brink. Publicans have been navigating a storm of rising costs, including the increase in minimum wage, additional mandatory sick days and the impending pension auto-enrolment scheme. This latest price hike is a blow they cannot afford.”
He said the cumulative effect of these financial pressures threatened the viability of the trade.
“The Government must come forward with support measures for the trade, as the Increased Cost of Doing Business grant, while welcome, is not an adequate response.”
“The VFI is calling for further supports to include a reduction in excise, a return to the 9 per cent VAT rate for pubs serving food and a reduction in employer’s PRSI. Publicans can’t be expected to take all these hits without meaningful support.”
The VFI also appealed to the public to understand the challenges facing their local pubs.
“We know our customers are in the middle of their own cost-of-living crisis so the last thing our members want to do is increase prices. Unfortunately, most publicans will have to pass on this increase, as it’s all but impossible to absorb given the rise in labour costs and other soaring charges,” Mr Crotty said.
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