BrewDog has warned that the UK brewing and hospitality sector is facing a £1bn cost surge over the past year, as rising energy, labour and raw material costs pile pressure on producers and pub operators ahead of the Autumn Budget.

The Scottish brewer said that escalating energy bills, increased National Insurance contributions, higher wages, and a raft of other new taxes and packaging regulations have forced breweries and pub groups to make “difficult decisions” to protect their futures.

BrewDog added that it estimates the industry would need to sell an extra 950,000 pints every hour to offset the additional costs.

“In the past year alone, energy, wages, National Insurance, raw materials, packaging and regulatory costs have all moved in the wrong direction,” said chief executive James Taylor.

“Taken together, these increases have added more than £1 billion to the sector’s collective bill.”

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The company recently announced targeted job cuts, a handful of UK bar closures, and the sale of its Lost Forest estate in Scotland as part of a drive to consolidate operations and focus on its core beer and bar business.

Taylor urged the Government to offer meaningful relief in next month’s Budget through reforms to business rates, beer duty and temporary VAT support for hospitality, warning that “many independent brewers and pub operators will simply not be able to withstand the pressure” if costs continue to rise.

He also pointed to international examples, including Ireland’s decision to cut VAT for hospitality from 13.5% to 9% from July 2026, as evidence of the kind of support needed to safeguard the industry.

Emma McClarkin, Chief Executive of the British Beer & Pub Association, echoed BrewDog’s concerns, saying: “This analysis reinforces the cumulative impact of the huge barrage of costs the industry has had to cope with. We urge the Chancellor to act by cutting beer duty and reviewing punishing employment and packaging costs so we can thrive at the heart of high streets and communities across the UK.”

Taylor added: “Britain’s brewing heritage is something to be proud of. With the right policy environment, this sector can be a powerhouse for jobs, growth and creativity.”