Struggling Pub Landlords to Get Governmental Help
According to British Beer and Pub Association statistics, there were almost 50,000 pubs in the UK in 2012, but this number has been falling steadily for the last two decades at least – in 1982 there were around 67,000 of the drinking establishments.
More than half of public houses currently open are owned by large pub companies, or ‘pubcos’, with the landlords saying that they struggle to make a living because they earn less than the equivalent of minimum wage. The pubs are forced to buy their supplies from the pubcos that own them, in what is called a “beer tie”, and these prices are often much higher than is affordable in the long run. Add that onto the low earnings of the landlords and it is not surprising that nearly 30 pubs close every week in Britain.
In a bid to help these pub tenants who are struggling to pay their rent or costs of supplies, the government has unveiled new plans to bring back the Great British pub.
“Far too many landlords feel their income is squeezed by big pub companies,” declared Business Secretary Vince Cable. “So today, we are taking action to make sure they get a fairer deal.”
One of the proposed reforms to be introduced by the Department for Business, Innovation and Skills is for publicans to be able to get a rent review if they haven’t had one for five years or more.
Landlords running bars owned by pub companies which already own more than 500 pubs will also be able to request something called a “parallel free-of-tie rent assessment”, which will show whether or not the pub would actually be better off independent of the pubco, and they will be able to choose whether or not to be bound to gaming machine suppliers, as well.
Deputy Prime Minister Nick Clegg explained that not only are pubs in Britain often the centre of communities, they also contribute billions to the economy and are a national treasure that has become the envy of the world, and, therefore, needs protecting. “For too long, landlords who are tied to large pub companies have struggled to make ends meet,” he said. “The self-regulatory approach has not worked, so these new rules will give fairer treatment for landlords so that they can keep your local pub going strong.”
On top of all this is the planned appointment of an independent adjudicator, which was requested via a petition with over 45,000 signatures put to it, brought about after a campaign initiated by Lib Dem MP Greg Mulholland. The adjudicator will be enforcing the code, investigating breaches and imposing sanctions such as financial penalties on pubcos that fail to comply with the rules.
The decision has been welcomed by CAMRA (the Campaign for Real Ale), who said it believes that it is vital to keep pubs open and protected from the “heavy-handed business practices” of pubcos.
“We are delighted that, after our ten-year campaign, the government is now introducing a pub adjudicator to protects the nation’s pubs,” said CAMRA Head of Communications Tom Steiner. He revealed that landlords – and the customers frequenting their establishments – may even get to see a fall in the prince of a pint.
“[The] announcement is great news for publicans and pub-goers alike.”