Pubcos & How They Have Got Away With It For So Long – The Health & Safety Angle!

By Dave Mountford

When writing Mein Kampf, Hitler first propagated the idea of “the big lie” – of a lie so “colossal” that no one would believe that someone “could have the impudence to distort the truth so infamously.”

Whenever I have put forward a briefing document or presentation to  people unfamiliar with  the great PUBCO scam, I always remember that statement and its relevance to this industry. 

One of the reasons I have struggled to maintain  enough energy, to remain a part of this on-going battle, is my utter  frustration at the inability of anyone to take this issue seriously, beyond a couple of politicians and a handful of hard working Publicans.  With the notable exception of  some well-meaning journalists, the national newspaper industry has met the devastation of our British pub heritage with little interest our own trade Press is so nervous about the litigious prowess of the boys from Solihull and Burton that huge opportunities for proper investigative journalism are ignored. Accurate and well researched stories such as Green King’s breaches of the insolvency act are “not understood” and instead of headlines such as “BBPA caught lying again to BIS”, we get “BBPA defends itself against accusations of misleading Government” – I mean, ask yourself if you could imagine another industry in which a serious journalist would fail to have a field day with Brulines (the flow monitoring system that is placed into cellars to measure what is dispensed so that the figure can be compared to what was purchased through the tied arrangement – inaccurate but used to levy fines anyway)?

 

It is relatively easy, once you take the time, to discover why supposedly intelligent people will support the status quo of the tied model. Business relationships are deep and mutually reliant in this industry and the “old boy network” in some cases goes back generations. The fact is that the unregulated power of the PUBCO model has cast its insidious net far and wide and many are entwined in it.  Take SIBA –, The Society for Independent Brewers whose  top brass support the status quo and feel that the option of a free of tie would be devastating to the industry.  I was personally told by Nick Stafford, Finance Director, that FOT would benefit his members not one jot, and yet logic dictates otherwise. I currently use 37 different locals and  having asked the question of them I have had a 100 % positive response that Free of Tie would benefit their business. So, why does SIBA think otherwise on this issue? Is it because they know something that the average Brewer doesn’t or is it because the SIBA DDS is so reliant on the continual existence of the PUBCO Model, it can’t survive without it?

However if there is one area that should have got someone’s red light blinking, its Health and Safety.

We live in an increasingly Health and Safety conscious environment. I’m sure everyone who is reading this is familiar with an example local Councils who insist on the most stringent of H & S regulations. However in 2009 when I contacted my local council to inform them that I had discovered that the Pub he was running had been handed over to me without gas and electrical certificates and was a danger to my family and my customers, they just weren’t concerned.   Looking back I was certainly naïve but then in my defence you would expect if you are going to rent a property from a landlord, you would expect the property to be safe and fit for purpose – certainly that is the case or residential property. Alas not for commercial premises even if it has living accommodation. The failings were well  documented and I managed to prove that not only had Punch Taverns not undertaken any due diligence regarding The Rising Sun before myself and my family walked in, they knew about it and then proceeded to lie to me for the best part of 18 months.

However, my local Council were hardly jumping up and down in an effort to get to the bottom of the situation either, firstly referring me to The Health and safety Executive. The HSE then compounded my frustration and misery by pointing me in the direction of my local Council despite them successfully prosecuted Enterprise for breaches in H & S only Months before. This toing and froing continued until I took matters into my own hands and a healthy dose of negative publicity got firstly the BII, and then Punch interested – the rest as they say is history, but the frightening aspect of my story was that it was far from unique.

If you don’t know the perfect PUBCO handover  – according to the PUBCO that is , goes something like this:

Outgoing tenant, having his Pub in as good condition as it was when he took it on 20 years before, retires to the Bahamas on the massive profits he has made, hands over his Pub to new tenant on the same day with gay abandon and joyful celebration, passing over all relevant and up to date documentation such as Gas, Electrical and Asbestos reports showing due diligence and a spanking Pub ready to rock and roll and make loads of money for the newbie.

Now I’m sure you all recognise the reality which goes something like this:

Outgoing tenant either evicted for non-payment of rent made up of rent, inaccurate fines for buying out, beer purchase debt, interest, mesne profits and just about anything else the PUBCO can throw in, or outgoing tenant does a moonlit flit, facing bankruptcy from the many numerous creditors he has racked up over the 12 or so months he has been in the Pub, said Pub then being boarded up for a short period of time before re-opened by a management Company run by the best friend of the BDM or opened by the same PUBCO Pub down the road’s tenants half-brother who once cleaned a Hotel in the Village next door. Pub then advertised on PUBCO website as a great business s opportunity to attract some unwary numpty with a bit of cash and the rough idea of how to pull a pint, handed a set of keys, told where the light switch is and off you go mate…….

In the second example I have shown there is a critical difference from the first and that is that there is a period of time between the old tenant being thrown into a lifetime of indebtedness and the new tenant taking over, this time frame is usually filled by either a Tenancy at Will, a Management Agent or a number of large boards on each window with a sign that says “make a difference to your community, run your own Pub”. In each of these examples the ownership of the Health and safety of the Pub reverts back to the landlord, and therefore it’s the Landlords responsibility to make sure that the Pub has gas and electrical certification.

Following my high profile “spat” (to quote the Morning Advertiser – how’s that for the blithe description of a Company whose deliberate inaction put my family and customers lives at risk) – I was asked to assist other tenants in similar situations to myself. What I discovered was a pattern of similar Health and Safety issues, all surrounding the crucial time of handover from one tenancy to another. It became clear that my experience, far from being an isolated incident, was a frequent occurrence and on occasions this extended beyond mere electrical issues. 

A Hotel in Wales rented out by Enterprise Inns was discovered to have a broken waste pipe under the bar, venting raw sewage into the cellar. Subsequent investigations made it clear that the BDM was well aware that this was a long running issue and had been part of a dispute with the previous tenant. This Hotel also had significant electrical problems which should have been corrected by any competent electrical report, but no such report existed. The refurbishment promised to this particular tenant was put back after he signed the lease and he was forced to spend the majority of his own money on basic remedial work in a desperate effort to get the business started – a familiar tale no doubt. Many campaigners will be familiar with The Owl at Rodley in Leeds, a Pub that I became involved with in 2009. Once again basic Health and safety issues were at the root of the problems within the Pub and again. The landlord ignored all the requests to follow up on inspections that the tenant had paid for herself. Inspections that showed serious issues with the electrical safety of the property, and again, something that was the responsibility of Enterprise Inns.

It was during this protracted case that I began to realise that Enterprise really were not bothered, not necessarily because they were in the right, the evidence showed they weren’t, but more to do with the fact that they knew that no one was interested in this issue. Again I was pushed between the local Council – “nothing to do with us Mr Mount ford, speak the the HSE” and the HSE – “sorry Mr Mountford, we do not deal with preventative issues, speak to your Council”. I recall pointing out this– “by saying you’re not interested in preventative issues, does this mean someone has to die before you take any interest”. If I remember correctly then guy on the phone agreed that this was something that had been levelled at him before. Of course that was exactly what the HSE had done in the case of Paul Lee, the Liverpool licensee who had died in this pub premises as a result of a failing by Enterprise Inns and where it was highlighted that another 474 tenants were put at risk.

http://www.hse.gov.uk/press/2010/coi-nw-46enterpriseinns.htm

However it was during our Hotel Case in Wales that it finally became a little clearer just why this area of the PUBCO abuse model, should be one that they were least worried about. After  getting the backing of the GMB I persuaded one of our Health and Safety teams to write to the HSE. It was clear from the response, some weeks later,  that the Health and Safety Executive were only interested in Gas safety in Domestic Properties and Local Authorities were responsible for enforcing “most other Health and Safety legislation in Public Houses”. However it would appear that Westminster City Council were responsible for Enterprise Inns and they “act as a focal point for national matters with the Company”

I then received a second letter in late April informing me that the HSE had met with the Group Safety Manager of Enterprise along with Westminster City Council and following this meeting (which I wasn’t aware of nor was I invited to) the HSE were “satisfied that Enterprise Inns do have a suitable policy and management system for domestic gas safety issue” and this was “supported by management arrangements to monitor and review the implementation of the Policy”

Obviously that was fine then!!!

So……where does that leave those who are suffering from potential breaches in the area of Health and Safety – creek and paddle comes quickly to mind!!!

Enterprise and others  will obviously look to  exploit this glaring grey area in the law and our experience of local Councils shows how reluctant they are to go up against expert litigators employed by  PUBCOs when they have neither the manpower or the legal clout to do so. The HSE are obviously satisfied that everything is tickety boo, without even visiting the average PUBCO tied Pub and meanwhile tenants are still allowed to trade in premises that are at best not fit for purpose and at worst are death traps.

In the end until the worst happens and there is another Paul Lee, we can only keep raising the issue and hope that this will be addressed as part of the statutory legislation that can’t come soon enough.

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4 comments on “Pubcos & How They Have Got Away With It For So Long – The Health & Safety Angle!
  1. Publican Sam says:

    Spot on Mr Mountford. It’s high time primary legislation was altered to include commercial properties within the scope of H&S especially relating to gas and electrical installations.

  2. J Mark Dodds says:

    Ah, tied Pubco’s – led the Arthur Daleys of the pub sector, with no conscience

  3. J Mark Dodds says:

    Ah, tied Pubco’s – led by the Arthur Daleys of the pub sector, with no conscience

  4. John Feeley says:

    I have said many times, the only language the Pubcos understand is MONEY. Everyone should stop paying rent and buy out ! This would get the attention of the press and politicians. We hear the same old same old week in week out and as Dave implies, no one is listening. The PMA is just another mouthpiece of the Pubcos as is the BII, BBPA and many others. A few years ago the GMB looked to be our saviour, but alas, they turned out to be a toothless bulldog, all talk and very little action ! It’s probably too late for me, I’ve a lease renewal in November and I do not think it’s worth the worry or the risk staying in bed with unprincipled con men like ENTERPRISE INNS. I wish I knew how to get the message out to all the vulnerable publicans just waiting for the axe to fall. Being nice and patient will not work, time for drastic action. And don’t think the government is going to make any difference with legislation, Georgie Porgy Osborne will look after his mates, mark my words.
    John Feeley, Bruce Arms, Masham. brucearms@hotmail.co.uk

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