‘I turned my failing pub round after modelling it on Aldi however Labour’s disastrous finances means I can not promote pints for £2.40’

The boss of Britain’s cheapest pub says the budget will force him to raise his prices early next year after Chancellor Rachel Reeves raised taxes in the UK to their highest level in history. 

Mike Westwood, 40, saved the Waggon and Horses in Oldbury by modeling it on budget supermarket Aldi and turning it into the home of cheap booze.

All his pints cost £3 or less with Carling, Coors, John Smith’s and Strongbow all selling for just £2.40.

But the massive hike in National Insurance payments for employers, as well as an increase to the minimum wage, has threatened the pub’s revival and caused chaos across the hospitality industry. 

Sir Tim Martin, the chairman of Wetherspoon, said his pub chain’s tax and business costs are expected to increase by about £60 million over the next tax year. 

This will include an estimated 67% increase in National Insurance Contributions, which was raised by 1.2p from 13.8 per cent to 15 per cent, while the starting threshold was lowered from £9,100 to £5,000. 

Business leaders have told the Government they are now in ‘survival mode’. 

Fellow pub chain Fuller’s has declared that rising costs could see its annual investment halved from £60 million to £30 million, while Young’s has also declared it may be forced to follow suit. 

Mike, a wholesale supplier to a number of pubs, said: ‘The budget is bound to effect us. I thought it was really sneaky – to announce they are taking a penny off a pint when all their other measures are guaranteed to add 10 or 15p to a pint.

‘We will have to look at it in the new year. I will take the hit in the meantime and wait until the breweries all put their prices up which is usually around February.’

Mike, a married dad of two, has been the leaseholder of the Waggon and Horses for seven years.

He had tried to run it as a real ale pub but that did not work and last February he slashed prices in a bid to stay afloat.

‘I looked at how Aldi and Lidl do it and wondered if I could do something similar,’ he said. ‘It’s all about footfall and volume.

‘Before I made the change we’d get maybe a dozen people in all day on a Monday, now it is 40 to 50 which is incredible for the size of the property.

‘The majority of people around here are struggling and if they can have four pints for a tenner then that’s great.’

The budget has even forced cost cutters like Wetherspoons to prepare for price rises.

Mike said their volumes meant that they could buy at far cheaper prices to him but even they are struggling.

Sir Tim Martin, the chairman of Wetherspoon, said his pub chain’s tax and business costs are expected to increase by about £60 million over the next tax year.

He said: ‘ Martin said: ‘Cost inflation, which had jumped to elevated levels in 2022, slowly abated in the following two years, but has now jumped substantially again following the Budget.

‘All hospitality businesses, we believe, plan to increase prices, as a result.

‘Wetherspoon will, as always, make every attempt to stay as competitive as possible.’

The Waggon is a tiny operation by comparison – a classic old-style boozer with two small bars on the ground floor and a £1-a-game pool room upstairs.

The hits blast out from the jukebox as punters enjoy their cheap drinks every day of the week.

Builder Adrian Dancer, 56, said: ‘I come in here every single weekday after work. It gives us the chance to relax and I don’t drink at home, I like to socialize.

‘It’s not my local. There I would pay £3.80 for a pint that here costs £2.40. I only need to drink four pints and I have covered the cost of my taxi from home which is £4.50.

‘The beer actually tastes better because it goes through the pipes quicker because he’s selling so much of it.’

Asked about the budget, he replied: ‘I don’t like the bloke in charge. He said he wouldn’t take money from pensioners and then as soon as he gets in, he sorts out the doctors and the train drivers and takes it of the pensioners.’

His son Ben, 18, added: ‘I like the atmosphere in here. If the prices weren’t as low as they are then you wouldn’t have the atmosphere.’

Andy Hunt, who runs a small steel construction business, said: ‘I work all over the country so I now how lucky we are to have this place.

‘In London the average pint is £6.50 but here the same drink is £2.40.

‘On Fridays and Saturdays you can barely move in here. It actually used to be one of the more expensive places to drink in Oldbury before the boss changed tactics.

‘I love it. Wetherspoons is a great place for cheap food and drink but it’s a talking pub whereas I like a jukebox.

‘I found parts of the budget really shocking. The tax on farmers is going to kill of many family farms and the National Insurance rises, well, we just have to take them on the chin. I am sure the prices of beer will go up as a result.’

Another drinker Naomi Tolley, 32, was on a Strongbow and blackcurrant which cost her £2.30.

‘This is my local and on a Sunday it gets really busy but even on a weekday there are always people in. Everyone knows everyone else and it brings people together.’

Recycling worker Timothy, 31, had brought in his workmate Jordan, 30, to sample the cheap stuff.

‘We are both drinking Madri which is £4.90 in most places but £2.90 here. I don’t know how they sell it as cheap as they do.’

Jordan added: ‘These days pubs have to do something to stop people buying their cans in the supermarket and going home with them.

‘I would say this is a pub for the people. It is one of the little enjoyments in life and by keeping the prices down he is making that possible.

‘The budget hasn’t helped and if the prices do go up then the drinkers might stay home which is bad for everyone.’

And a 67-year-old drinker, who did not want to be named, said: ‘The budget was just the working man being ripped off yet again. The pensioners got it this time but everybody is out of pocket.

‘This place is trying to do right by the people. Even Guinness is only £3 and it’s £4 everywhere else.’

Bar manager Sophie, 42, said: ‘One of the reasons they keep the prices low is to make sure people come in and as a result it does have a really good atmosphere.

‘You get people coming from out of town just to see the prices for themselves but most of our customers are locals – a mix of working and retired people. It’s a good mix.’