Licensing disadvantages Qld brewers says industry

Ocean View wine and beer

Ocean View Estates, located just outside Brisbane, is in a unique position. As both a winery and a craft brewery, it has experienced firsthand the disparity between beer and wine when it comes to Queensland’s licensing laws.

These licensing laws are in the spotlight as the first anniversary of the state government’s Craft Brewing Strategy looms. The manifesto promised to “streamline” and make material changes to the complex and restrictive state licensing laws, which industry figures say put craft brewers at a disadvantage, in contrast to the state’s winemakers.

Thomas Honnef, owner of Ocean View, said that they had experienced both sides of the coin, and found that winemakers benefitted from advantageous legislation. Even the newly-introduced container deposit scheme in the state applies to beer containers (as well as soft drink and water containers) but not to wine bottles.

This incongruity has been brought to the fore at recent festivals Ocean View has attended, including Regional Flavours and events in the Moreton Bay region like the Moreton Bay Food and Wine Fest. Under the existing rules they were able to sell their own wine but unable to sell beer there.

“We just don’t take beer there. Anything produced under our wine producers can be taken and sold, but not our beer. The Moreton Bay festival organisers had a full community licence which allowed us to sell there, but if it’s under our beer producers licence there is no ability to do that,” Honnef said.

“What’s happened is that the wine industry saw a large growth in the popularity of fine table wine in the 1990s, and it developed a different sort of clientele and feel,” Honnef said.

He believes it is the perception of beer and its association with excess which has held it back in legislative terms, as well as its traditional ownership by large corporates which has led to it being treated as ‘big business’.

“Beer has always been dominated by the big producers. In Australia there were three or four brands, based on the state you live in, monopolised by those big companies.

“With beer, it’s all about what society perceives it as, and society perceives beer as a drink people just get stuck into.

“It’s an evolution of business that people are making craft beers.”

Now that craft beer is becoming a major growth sector and more vocal as an industry – coupled with changing beer drinking habits – legislation will move with it, he said.

The state government itself placed emphasis on growth statistics of the industry in the strategy – saying that the local industry of 90 individual breweries employing more than 1,700 (as of 2018) contributed an estimated $62 million annually to the Queensland economy.

The strategy planned to “address inconsistencies in regulatory systems” – of which the licensing disparity between wine and beer is one.

Craft beer vs wine

Ocean View owner Honnef said that licensing laws are “very complicated”.

“They take a fair bit to understand and to try and change them,” he said.“[With] craft beer there is room to change the law and allow satellite and event variations on your licence. With wine, we have to apply for that privilege, and for every event we have to apply for it and they have to approve it.”

The satellite and event additions to wine industry licensing are one of the major points of contention, according to Russell Steele of RSA Liquor Professionals, a licensing, training and compliance business.

These disparities are largely as a result of the 1994 Wine Industry Act, which gave winemakers access to an advantageous licensing regime.

“They made it a standalone act separate from the Liquor Act, and its purpose was to support and develop the Queensland wine industry.

“Fast forward 25 years it’s been an absolute success,” Steele said.

Similar to the rhetoric around the Queensland Craft Beer Strategy, the act aimed to foster investment in and growth of the state’s wine industry, and also develop its tourism potential.

It introduced the the satellite cellar door licence which allows wine producers with a wine producer licence to sell or give away their product at other venues – anything from a gift shop to a delicatessen.

“It gives them is a direct path to market. They can be like Jupiter basically, they can have as many moons as they like – there is an unlimited amount of satellite licences they can apply for,” explained Steele.

“They also are entitled to a wine permit, which gets lodged 21 days before an event. That means any Queensland winery, either individually or collectively can get one, and sell their product at a festival or farmers’ market.”

Neither of these licence extensions are an option for Queensland brewers.

“Every state has very different liquor legislation so it’s hard to make generalistic comments, but Queensland has fairly conservative liquor laws,” explained Steele.

“Retail liquor takeaway is mostly restricted to commercial hotels and clubs. Craft beer permits are allowed in the Liquor Act already, but they only allow a brewery to provide samples at an event, with some limitations, and it can be a free sample only – they can’t sell liquor for consumption by the glass or stubby.”

Steele said that whilst this might not be an issue for brewers with the supply, brand and profile to enable them to list in major retailers like Dan Murphy’s or BWS, it’s the smaller, hyperlocal breweries that are suffering.

He suggested an artisanal producer licence, to encompass not just breweries but distilleries as well, which would give them these satellite and event licence rights.

“What we asked for was parity with the winemakers. Treat us the same as you do the wineries,” he said.

David Kitchen, the Independent Brewers Association’s Queensland representative and founder of Ballistic Beer Co, said that one of the most important things to the organisation was getting licensing right.

“It’s a hindrance in most cases and an embuggerance in others,” Kitchen.

“When you have to have two or three different licences and everyone is a bit different in the way it’s implemented, that’s something that we really need to have streamlined to allow us to continue to grow, expand and be profitable in that process so that we can afford to do it.

“If we can get the licensing done in a manner that allows that, it will be a very significant win for us, but one that we haven’t got near yet.”

He said that the IBA had been in discussions with the state government about the issue, and it was looking into specialist licences.

“They’re looking at an artisan licence which is a step up from our current producer wholesaler licence and could give us quite a leg up in the industry if that’s done right. I very much encourage them to continue to consult with the relevant players in the craft beer industry.”

He said the disparity between wine and beer producers was an “illogical inequity”.

“There’s this massive double standard in what’s acceptable for wine but not for beer.

“You can go to any farmers’ market, buy and drink wine and nobody bats an eyelid at it, even though it’s three times more alcoholic than most beers.

“Beer at the moment is exactly where wine was at the beginning of that growth and support from the government,” Kitchen said.

“If the government supports the craft beer industry properly, there’s no reason why its not going to be the next wine industry – the next massive export industry with a renewable product that’s not environmentally degrading. If they get behind it more then chances are they are going to reap the benefits.”

But whether lobby groups and the Department for State Development can get these licensing changes over the line is another matter, due to the association of the craft beer strategy with tackling alcohol-fuelled violence in the minds of policymakers, according to these industry figures.

Tackling alcohol-fuelled violence

In April, the 778-page, state government-commissioned Quantem report was released, looking into the tackling of alcohol-fuelled violence in the state.

It found that Queensland needs “more refinement and regulation” and that “continued high levels of alcohol consumption and insufficient regulation of the market” were behind continuing alcohol-related violence.

“The government made a policy decision to link their response to tackling alcohol-fuelled violence, which is a complicated, controversial consideration with craft beer legislation. Instead of running a single bill focused on the craft beer strategy, they adopted a policy position to combine them,” explained Steele.

Steele said associating any craft beer legislation with this social agenda risks tarring independent beer with the same brush, and with a state election next year, it could prove a make-or-break moment for any licensing changes for the brewing industry.

“If the two are linked together, by not making a standalone specific craft beer strategy bill, we fear that we will lose a bunch of other things that were discussed, including a legislation amendment around grant programmes that will give producers access to scale up grants, as well as changing planning laws and liquor licensing.”

This itself harks back to historical perceptions of beer, which identify it as fuel for violent and anti-social behaviour. The IBA’s David Kitchen said this was a perception that needed to change, but one that wouldn’t if craft beer continues to be inextricably associated with social issues related to alcohol misuse.

“Even if you look in the front cover of the Craft Beer Strategy, it says alcohol is a dangerous and nasty product, it will kill people and all of that,” he said.

“I would love to see people looking at craft beer and breweries in a completely separate light to a big box pub or a drinking precinct.

“What’s positive is [in craft breweries is] the predominance of families at these places. There is already a real self-monitoring of behaviour as a result of that.

“Also children are seeing adults drinking sensibly, and learning that it’s ok to go and engage in conversation and have the occasional beer – not go and get wasted. Correct behaviours are being modelled.

“If you allow craft breweries to operate you are rewarding the behaviour that you want to encourage. Education is better than policing. Craft breweries help them achieve what they want in a way that’s not financially crippling for the operators.

“In every way it’s a better model for managing alcohol-fuelled violence. As an alternative to these unsuccessful methods of managing consumption of alcohol, craft breweries provide an excellent example of positive action.”

Steele agreed, saying that the government should be focusing on the positive contributions of craft beer.

“We want to continue to work with the government, but we are asking them to prioritise this in a way that reflects how many jobs we are creating and are continuing to create.

“The frustration felt by the local industry when high level government support was provided to BrewDog is now even more palpable.

“18 months after venting our frustration, there’s no sign of changes, and there hasn’t been much done to support the local brewers.”

Minister Cameron Dick of the Department for State Innovation, who spearheaded the Queensland Craft Beer Strategy, told Brews News that when it comes to legislation affecting craft brewers, it had consulted with the IBA in October 2019, and is planning on having legislation amendments introduced into Parliament in early 2020.

“We’re consulting extensively with the industry around liquor licences and potentially establishing a new licence category for smaller enterprises and new entrants,” he said.

“…and now the federal government has announced proposed amendments to the excise regime, we’ll support the Independent Brewers Association to put forward proposed amendments that will best underpin future growth for Queensland’s craft brewing industry.”

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