All-Party Parliamentary Save the Pub Group
FAIR DEAL FOR YOUR LOCAL CAMPAIGNERS DESCEND ON 10 DOWNING STREET
Campaigners today went to Downing Street calling on the Prime Minister and Chancellor to give local pubs a fair deal 25 years after the Beer Orders
Supporters of pubco reform and the Fair Deal for Your Local campaign today went to 10 Downing Street to mark 25 years since Margaret Thatcher’s Beer Orders and called on the Prime Minister and Chancellor to urgently act to stop large pub companies exploiting publicans around the country.
2014 is the 25th anniversary since a Conservative Prime Minister and Chancellor led the Government which introduced the ‘Beer Orders’ to break up the unhealthy dominance of the ‘big 6 brewers’ who dominated pub ownership and restricted both choice for consumers and access to a very closed market for small brewers. That Government rightly identified the problem and was right and courageous in taking action, showing that Conservative Ministers do intervene in markets when they are anti competitive and failing consumers – which the current one certainly is.
The problem, however, was that – due to very well funded vociferous lobbying by large companies and their lobbyists – the Government agreed to ignore the advice of the Campaign for Real Ale and others and decided not to introduce a limit of the number of pubs owned by non brewing companies, introducing a limit only for brewers. This was a fundamental flaw, a loophole spotted by the big boys and the money men and directly led to the creation of the large non brewing pubcos. They of course did sweetheart deals with large brewers following golden handshakes, to carry on selling beer and whilst the Beer Orders did affect the big brewers it did in fact simply transfer the power from one dominant group of companies to another. Ironically pre Beer Orders, we had the ‘big 6’ brewers dominating and skewing the market; now we have 6 big pub owning companies that similarly dominate the market and in the cases of the large leased pubcos, have distorted and abused the traditional brewery tie meaning that it no longer is fair for licensees or good for customers – and has been awful for the many communities that have lost pubs as a result.
25 years on, supporters of pubco reform and the Fair Deal for Your Local campaign today handed in a letter to 10 Downing Street, calling on David Cameron and George Osborne and the Coalition Government to put the right the flaw in the Beer Orders and in the same way that their predecessors dealt with the closed and anti-competitive pubs marketplace then, to do so again now and allow thousands more pubs to survive and thrive without the ripoff prices and rents charged by the large pubcos. Campaigners are telling the PM that he must put right the flaw – and not make the mistake of giving in to well-funded, self-interested lobbying by the large pubcos.
Mark Dodds, Dawn Hopkins, George Scott, Val Spencer, Dave Mountford and Greg Mulholland MP at 10 Downing St
This follows a statement at Prime Minister’s Questions last week from the Prime Minister who acknowledged the need “look very carefully at what is happening in tied pubs and at the activities of some pub companies.” David Cameron went on to say that he was “looking very closely at what more we can do to make sure there are fair outcomes for Britain’s publicans and Britain’s pub goers.”
The message from Fair Deal for Your Local campaign to the PM and Chancellor is that the way to deliver this fairness – the only way – is through the ‘market rent only’ option which is a market based solution that will allow competition back into the market and this will give consumers a better deal, in effect finishing and properly doing what the Beer Orders were meant to and partially did with beer, and partially and spectacularly failed when it comes to pubs – due to giving in to the same kind of lobbying happening now.
Commenting, Chair of the parliamentary Save the Pub Group and coordinator of the Fair Deal of Your Local campaign, Greg Mulholland MP, said:
“Twenty five years ago, a Conservative Prime Minister and Chancellor correctly identified that the unhealthy dominance of the big 6 brewers was stopping small breweries getting access to market and giving consumers a poor deal. Now 25 years on, we have a Conservative Prime Minister who must act to deal with the mistake made then – and now intervene to stop the rip-off beer prices and rents being charged by the large pubcos.
“I was pleased the Prime Minister last week personally acknowledged the need for “fair outcomes” for the nation’s publicans. The only way to this is to introduce the market rent only option for the large pubcos. We have had enough delay now and it is time for the PM and Chancellor to decide if they support indebted pubcos, big bonuses and crony capitalism or pubs, hardworking licensees and real choice for consumers”.
Vice-Chair of the parliamentary Save the Pub Group Caroline Nokes MP said:
“The tied leased pubco model is a model that’s anti-competitive, distorts prices and exploits small businesses. The Federation of Small Businesses, Forum of Private Business, nine other pub sector groups, as well as the BIS Select Committee all agree the Government must introduce a ‘market rent-only’ option.
“The Fair Deal for Your Local campaign is going to 10 Downing Street to reiterate to Government that only this will bring down the price of a pint across thousands of pubs and give the sector the “fair outcomes” the Prime Minister himself talked about.”
Fellow MP Brian Binley added:
“38 years ago I was involved in the pub swap which saw many Midlands pubs change their branding from Mitchell and Butler and Ansells to Courage in one fell swoop. And where did it get us? To the demise of the old brewery estates, beneficent as they where, and onto the age of the pubcos with their unsustainable financial structures.
And was the social world of pubs enhanced? Clearly not. So what are the lesson? Keep Government out of meddling with the pub business other than accepting the recommendations of the BIS Select Committee: Free up tenants from the thrall of the big pubcos. Allow them to pay a fair market rent and free them from the tie.”
Grahame Morris MP also added:
“Parliament has spoken and we must now act to fix the unbalanced and unfair relationship between landlords and the large pub companies. It has been 25 years since the Beer Orders, which laid the foundations of the fundamentally flawed and anti-competitive Pubco model, and the Government now has the opportunity to right this wrong.
We must end this unviable business model that prioritises short term profit over promoting and supporting the long term future of pubs in our community. I hope the Government will listen to campaigners by introducing a ‘market rent only’ option, which is the only way we can deliver a fairer and more competitive market that works in the best interests of consumers and publicans.”
Emily Ryans Campaigns Manager for the Campaign for Real Ale (CAMRA) said:
“25 years ago at the advent of the Beer Orders, CAMRA raised concerns about the monopolisation of the pub sector by big companies and the impact of this imbalance of power on the beer and pub sector.
“Our campaign aim is the same now as it was 25 years ago: to deliver fairness, choice for consumers and freedom for licensees to make a reasonable living. We are calling for a statutory code of practice, market rent only option and guest beer right for licensees tied to large pub companies.”
Simon Clarke of the Fair Pint campaign added:
“Fair Pint Campaign cannot encourage the Government enough to ensure that the intervention into the pub industry is not a watered down version of what is needed. The pubcos’ self-regulatory code simply put into a statutory form would be disastrous as it does not begin to address the fundamental issue of tenant profitability and the unfair share of risk and reward. Ed Davey said what is needed is material and meaningful reforms and that is what thousands of tied tenants in the land are clinging on for.
With the sheer size of response to the Public Consultation and the unanimous support from the House of Commons in three votes, demonstrating overwhelming support for a statutory code with market rent only option, we look forward to the Government finally announcing that the long term public interest will take priority over short term big business profits.”
Steve Kemp, GMB Union’s lead organiser for tied pub tenants said:
“GMB is campaigning for Option 3 in the statutory code. This will offer tied tenants the ability to buy products from the open market and pay a fair market rent for the building. This statutory code is likely to be our one chance to save local pubs. This campaign exposes the Orwellian world where the pubcos say that regulation to ensure a free market is “red tape”.
Inez Ward of Justice for Licensees added:
“25 years ago the then Conservative government brought in the Beer orders which were fundamentally correct in addressing the problems in the market, however they were also fundamentally flawed in allowing the big pub owning companies to arise from the ashes and behave in no different fashion. This government now need to address and rectify that flaw with a Fair Deal, in order that pubs may continue to support and benefit their local communities and Britain as a whole.”
Chris Wright of the Pubs Advisory Service said:
“We welcome Government action on fairness, this issue has been subject to BIS enquiries for 10 years now, clearly there has been no rush to legislate in this sector. Self regulation has had more than a decade to work, some pub company codes date back to 2002, it is therefore completely understandable that statutory intervention has been proposed by Government and accepted by the trade as the way forward.”
1. For more information contact Mo Saqib (Parliamentary Researcher to Greg Mulholland MP) on 0207 219 3833.