Cork VFI chair: Pint price rise will be passed on

The Cork chair of the Vintner’s Federation of Ireland (VFI) has warned that Diageo’s latest price increase of 12 cent per pint “will be passed on to customers”.

Global drinks giant Diageo has announced an increase of 12 cent per pint, exclusive of VAT, on every draught beer in its range from February 1. This includes Guinness, Rockshore, Hop House 13, Smithwicks, Harp, and Carlsberg.

Michael O’Donovan, owner of the Castle Inn on South Main Street, and Cork city and county chairman of the VFI, said it’s “inevitable” that the price rise will be passed on to consumers.

“It’s always disappointing when a company raises their prices, because at the moment with the current cost associated with doing business, it’s inevitable that those prices will be passed on to customers,” he said.

“We’re hoping that consumers will understand that we have to pass it on, we can’t absorb the prices at the moment with soaring prices of energy, with inflation, and general increase in the cost of doing business… I suppose that is the reason why [Diageo] are putting prices up, and we understand that… [but] to have this at the moment is really tough,” he added.

In a statement to The Echo, a Diageo spokesperson said that the company is facing significant input costs.

“Like many businesses in Ireland, we are facing significant inflation in input costs across our operations,” they said.

“We have absorbed these costs for as long as possible but unfortunately, we can no longer continue to do so,” they added.

The VFI have called for Diageo to reconsider the move, saying members are “extremely frustrated about the situation”, in particular following another price increase from Heineken in December, and the prospect of losing the 9% VAT rate at the end of February.

“[We’re calling on Diageo] to reconsider where they are in the business cycle at the moment in January and February, and maybe in a couple of months’ time when we hopefully have lower energy costs that they can come back and review the situation,” said Mr O’Donovan.

“Increasing prices with a cost of living crisis going on, it makes it difficult for people to come out and enjoy themselves… Price increasing is not what we want to do, because obviously keeping prices as they are at the moment gives us a battling chance to survive,” he said.