James Boag’s Brewery: Tours revived after $1m gov’t package
A new state government support package worth $1m for James Boag’s owner Lion is a “one-off,” Jeremy Rockliff says. So what happens in 12 months when the tap is turned off?
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Premier Jeremy Rockliff has confirmed his government’s $1m, 12-month support package for James Boag’s owner Lion is a “one-off,” but he expects that funding to secure the future brewery tours and the visitor centre for “many, many years”.
Mr Rockliff and Boag’s management announced the deal had been struck on Thursday morning after Lion last week revealed its intention to shut down the brewery tours and the visitor centre at 39 William St, Launceston, from January 31.
“This outcome is a win-win for the Launceston community, and for Boag’s,” brewery director Nathan Calman said. He said the tours and visitor centre had run at a loss since the Covid pandemic.
The cash will enable free tours for Tasmanian holders of a state driver’s licence for a year and an advertising blitz to increase patronage amid other as-yet unexplained enhancements and expansion.
On Thursday afternoon at the visitor centre, Mr Rockliff and Mr Calman said they planned to work together moving forward to iron out kinks as they appeared.
Lion says a carton of beer is $3–$4 more expensive to produce in Tasmania than on the mainland, due largely to the inadequate Freight Equalisation Scheme, and believes the proposed Container Deposit Scheme (CDS) will add $9m-plus to its bottom line each year.
It seeks an energy deal with the state government to limit its ballooning bills, a rethink on the CDS – although it is legislated – and better advocacy to get a commitment from the federal government to boost the freight scheme.
Asked about the appearance of giving taxpayer funds to a company ultimately owned by Japanese beverage giant Kirin, Mr Rockliff said the cash was an “investment in northern tourism and local jobs”.
There was little detail as to what was likely to happen at the end of the 12-month support package. Mr Rockliff said the funding was a “one-off,” but he expected it to secure the tours and visitor centre for “many, many years”.
Mr Calman said Boag’s management looked forward to working with the state government on how to get best bang for buck from the $1m.
He told the Mercury that Lion was undertaking significant work behind the scenes to try and put forward an unanswerable case as to why the freight rebates need to be hiked by the federal government to protect Tasmanian manufacturers from Australia’s last tyranny of distance.
$1m support package as Boag’s brewery owner Lion reverses centre closure
A support package worth $1m will be provided to James Boag’s Brewery owner Lion, which will now reverse its decision to shutter the Brewery Experience, comprising of tours, a visitor centre and function space.
In fact, so precipitous is the reversal, that Tasmanians holding a state driver’s licence will be able to take a tour of the iconic Launceston brewery for free for the duration of the year-long package.
Lion announced on January 18 that economic headwinds, including Covid, rising input costs and reduced beer consumption pre-empted its decision.
Premier Jeremy Rockliff castigated Lion for its decision, calling it a “kick in the guts” that did not “pass the pub test,” but it subsequently emerged that Lion and the Tasmanian Hospitality Association had raised the alarm bells regarding the brewery’s performance as early as March 2021 with Mr Rockliff’s predecessor Peter Gutwein.
On Thursday, Boag’s and Mr Rockliff announced a deal had been struck to keep the Brewery Experience alive, saving a dozen jobs.
“This outcome is a win-win for the Launceston community, and for Boag’s,” said brewery director Nathan Calman.
“The proposal to close the visitor centre and tours was not put forward lightly, but as a response to the significant cost pressures we are facing across our business.
“The response – an outpouring of immense passion for the continuation of our brewery tours and visitor centre experience, reminded us of just how integral Boag’s is to Launceston.
“As a thank you to every proud Tasmanian, we will be offering anyone with a current Tasmanian Driver’s License free brewery tours for the next 12 months.
“We hope this provides a great incentive to bring friends and family to visit Launceston, to understand what we do and enjoy all that our region has to offer.”
Mr Rockliff said the government support will help “enhance and expand” the experience.
“The Boag’s Brewery visitor centre is not only a local cultural icon but a vital part of the local northern economy attracting thousands of visitors a year,” Mr Rockliff said.
“The unique experience it offers has been a significant drawcard for Launceston for decades, with the benefits flowing to other businesses in the region and across the state.
“That’s why it’s so important that not only does the visitor centre remain open, but that we work with Lion to make the visitor centre experience and attract more locals and tourists. The funding will also support a targeted marketing strategy to promote the tour experience nationally.”
Launceston Mayor Danny Gibson urged locals to take advantage of the offer of a free tour.
“The decision by Lion to not only keep the visitor centre open and the tours operating, but to
actually further enhance both of those experiences is incredibly exciting for Launceston,” he said.
“It will provide a much-needed boost to our visitor economy, as well as further enhance our
region’s UNESCO City of Gastronomy credentials.”
It is now incumbent on the state government and Lion to ensure such drastic steps as closure can be avoided in future.
Lion still claims it is being walled in from all directions due to spiralling costs. It believes the state government’s proposed Container Deposit Scheme will add $9.3–$9.8m per annum to its bottom line and claims a carton of beer is $3–$4 more expensive to produce in Tasmania, due largely to the inadequacy of the Freight Equalisation Scheme.
Electricity costs are spiralling due to the Ukraine invasion and, as reported by ACM, TasWater is making moves to recoup the full cost of treating the wastewater of big industrial users in Launceston, including Boag’s.
“There’s a handful of large industrial trade waste customers that are actually not paying the full cost of treating their trade waste at our sewage treatment plants,” TasWater chief executive George Theo told ACM.
BOMBSHELL DOCS GIVE NEW BOAG’S TIMELINE
James Boag Brewery management and the Tasmanian Hospitality Association have scoffed at suggestions by Premier Jeremy Rockliff that he was caught by surprise by the announcement this week the iconic Brewery Experience would cease at the end of January.
The Mercury understands brewery owner Lion met with ex-Premier Peter Gutwein as early as March 2021 to request a range of additional assistance, including export partnership, energy relief, and a rethink on Tasmania’s container deposit scheme (CDS).
Nathan Calman, the brewery director, wrote to Mr Gutwein again on November 9, 2021, specifically to again foreshadow the concerns Boag’s held about the proposed CDS. Boag’s claims the current formula would between $9.3m – $9.8m a year to its costs, equivalent, it says, to 10 per cent of its operating budget.
The letter’s revelation by Labor MP Michelle O’Byrne, who had permission to release it, shows the depth of animus Boag’s management feels towards the state government.
After Lion confirmed on Wednesday night that the Brewery Experience, comprising tours, functions and a visitor centre, would cease from January 31, Mr Rockliff said the closure did not “pass the pub test”.
Speaking at Symmons Plains Raceway on Thursday, he said it was “not good enough,” a “kick in the guts,” and that he was “extremely disappointed”.
“I wish they’d come to us earlier and spoken to us about this and we could have worked through whatever challenges they may well have had, but don’t cut off your nose to spite your face,” Mr Rockliff said.
However, it’s now emerged that Boag’s management reached out to the state government at least twice in 2021, firstly at the March meeting with Mr Gutwein and then via letter in November.
It’s understood that at the March meeting, Boag’s management went into detail about the headwinds it faces, including spiralling energy costs, the feared hit from the CDS, and the lagging state of the Freight Equalisation Scheme, acknowledged to be a federal issue.
Tasmanian Hospitality Association chief executive Steve Old was caustic in his statement following Mr Rockliff’s.
“The Premier can allude to being blindsided by the closure of the Boag’s visitor centre but this is far from the truth,” Mr Old said.
“We flagged the struggles the visitor centre was facing on several occasions with state government ministers, but they chose to ignore our concerns.”
A state government source backed in Mr Rockliff’s prior statements on the Brewery Experience’s closure.
“We stand by our position that this decision is disappointing and does not pass the pub test, and should be revisited,” the source said.
“The Premier had constructive conversations with Lion (on Thursday) on the challenges they are facing, and we will continue to engage with them in coming weeks.
“There is no doubt the best thing for the workers and the northern economy is for the centre to remain open post-January.”
‘Massive kick in the guts’: Premier lashes Boag’s tour shutdown
The mayor of Launceston says grog giant Lion’s decision to close the James Boag’s Brewery Experience, comprising brewery tours, a visitor centre, and a bar and function hire space is a “significant blow” for northern tourism.
It was revealed late on Wednesday by Labor Bass MP Michelle O’Byrne that the experience, located at 39 William St, opposite the brewery itself, was being “wound up” at the end of this month.
“The Boag’s tour is an institution. (I am) so distressed to hear the Boag’s experience is being wound up at the end of January. This (is an) important tourism experience, employs locally and drives our visitor economy,” she said.
A Boag’s spokesperson told the Mercury the decision was pre-empted by a difficult few years during the height of the Covid pandemic.
“The last few years have been very challenging for our business with overall beer consumption in decline, rising input costs and the impacts of Covid on the hospitality and tourism industries,” they said.
“As a result, we have taken the opportunity to reassess our offering at Boag’s and made the difficult decision to close our permanent hospitality and tour offering.
“Sadly, this will result in some job impacts at the Boag’s visitor centre.”
Premier Jeremy Rockliff called on the mainland owners to reconsider their decision to shut down the centre.
“I am disappointed at this decision, which is a massive kick in the guts for both the workers at the site and the local Launceston economy,” Mr Rockliff said.
“The Boag’s visitor centre has been an iconic drawcard for Launceston for decades that attracts visitors from across the country, and there’s no doubt its closure will be detrimental to the northern economy.
“The unique experience it offers has been a significant drawcard for Launceston for decades, with the benefits flowing to other businesses in the region and across the state.
“I understand the mainland owner has cited the impact of Covid as justification for this decision, but with our economy strong and visitors returning in record numbers, this does not appear to pass the pub test.
“The government has reached out to Lion management this morning to better understand the reasoning for this decision and we stand ready to assist where we can to allow this iconic Launceston experience to continue into the future.”
Tasmanian Hospitality Association’s Steve Old claimed his group had raised the brewery experience’s struggles with state government ministers “on several occasions”.
He said pressures on the business included, in addition to Covid, the spiralling cost of electricity and freight, tax hikes and the belief the industry has that a proposed Tasmanian container deposit scheme would “put beer prices up for consumers”.
Launceston Mayor Danny Gibson said the experience’s loss was a “significant blow”.
“The Boag’s visitor centre and brewery tours are consistently ranked extremely highly by visitors to Launceston through feedback to the Launceston Visitor Information Centre and through a range of tourism review websites,” Mr Gibson said.
“In point of fact, the James Boag Brewery Experience is ranked by TripAdvisor visitors among Launceston’s top three most popular activities, alongside visits to iconic Launceston destinations like the Cataract Gorge and City Park.
“Boag’s has been associated with Launceston for more than 160 years and the City of Launceston has an excellent working relationship with local management on the ground at the brewery.
“However, the decision by Lion’s national office to effectively close the brewery to tourists is a significant blow for the city, especially at a time when Launceston is seeking to leverage the opportunities that will flow from being designated a UNESCO Creative City of Gastronomy.
“Lion has pointed to a range of Covid related factors in its decision-making, and there’s no doubt the past few years have been extremely tough for all kinds of businesses.
“However, it’s my intention to seek a meeting with Lion as soon as practicable to better understand the decision and to explore any opportunities to reconsider the closure in the future.
“I extend my sympathies to the affected staff at Boag’s who have done so much to boost Launceston’s reputation as a visitor destination to a global audience.”
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Originally published as James Boag’s Brewery: Tours revived after $1m gov’t package
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