by Peter Scott

Created on: November 28, 2010   Last Updated: November 29, 2010

Even before the present financial crisis in Ireland (November 2010), the traditional Irish pub was in serious decline. There are many reasons for this, principally:

- Smoking ban from 2004
- Supermarkets providing cheaper alcohol
- High government taxes on alcohol

The Smoking in the Workplace Act, March 2004, prevented pub customers and employees from smoking. The ban was an extension of a previous act that prevented smoking in public places. Since a significant number of Irish pub patrons smoked, the immediate effect was to drive drinkers out of the pub and into their homes where they could legally smoke. This resulted in a sharp fall of pub sales, and an increase in the amount of alcohol being sold by supermarkets and off licences (specialised shops selling alcohol). While some publicans acted quickly to offset the market loss by offering other services (typically better food), many pubs had to close due to falling revenue.

While many would argue that the smoking ban resulted in a healthier nation, there is no doubt that pubs have suffered. Smokers were one of their best category of customer since they would typically have several cigarettes with their drinks, and often have to buy cigarettes at inflated prices in the bar. Alternatively, notice of the total smoking ban was given in advance, and publicans prepared for the March 2004 deadline by installing outdoor areas for smokers (complete with heaters and seats). Other measures taken include themed areas, typically sport, where large-screen televisions and advertised games helped attract a new clientele. There is no doubt that city publicans were less exposed to the effects of the smoking ban, simply because they had a larger and more diverse pool of customers. Country pubs, relying on a relatively small section of their community, closed in their scores, especially where they were situated in more remote areas and away from main routes.

While many publicans point the finger at the 2004 smoking ban, they sometimes forget another major factor in the decline of pub sales, namely government excise tax. This vastly complicated tax, a long-standing taxation of the Irish Republic, adds approximately 30% to the price of alcohol sold in Ireland (in addition to Value-Added-Tax). In Dublin the average price of a pint of stout today (November 2010) is a huge 6 euros. Since many Irish people will use the round system to buy pints (each taking turns to buy for a group of people), an evening's drinking can cost over 60 - 70 euros, depending on the size of your group and the location. It is no wonder that many Irish people resort to shopping for cheap drink in their local supermarket and drinking at home.

A further factor in city pub closures was an effect of the Celtic Tiger, namely the price of property. Where a publican leased a building as a pub in a city location, its value frequently became far less than its value as real estate. Some publicans were given notice to quit, and the site of the bar closed for redevelopment as housing or apartments. Where a publican owned his bar, some gave in to the demand for real estate and sold their site. You can't blame them for wanting to give up the licenced trade for easy cash.

All of the factors previously mentioned are greatly increased by the current financial climate, and surviving traditional pubs must act quickly if they are to survive. Many have already proved that they can survive in a changing climate, but one wonders if we will ever return to the previous situation where the number of pubs in a country village outnumbered the number of shops.

Learn more about this author, Peter Scott.
Click here to send this author comments or questions.