Greg Mulholland MP, Coordinator of the Fair Deal for Your Local campaign and Chair of the parliamentary Save the Pub group, has responded to today’s government announcement of the pubco reform that will feature in the Queen’s Speech. Due to be delivered tomorrow, the Queen’s Speech will set out a Statutory Code of Practice and introduce a new independent Adjudicator for tied pub tenants, but will fall short of introducing a mandatory free-of-tie option.
Government will announce plans to introduce a Small Business, Enterprise and Employment Bill, expected to receive Royal Assent in March 2015. The Bill will introduce a Statutory Code of Practice for the first time and a new independent Adjudicator. The Code will comprise two parts; firstly, a Core Code protecting all tied tenants and giving them the right to request a rent review when beer prices increase significantly or their circumstances change substantially. All tied tenants will also have the right to take disputes to a new independent Adjudicator. Secondly, an Enhanced Code will require pub companies owning 500 or more tied pubs to offer parallel free-of-tie rent assessment to potential or existing tied tenants upon request if negotiations fail. Regrettably the assessment will be for guidance only and will not entitle tenants to go free-of-tie. Having long campaigned for a fairer deal for pubs, Mulholland has welcomed the proposed reforms as “a huge win” but has said that the mandatory free-of-tie option is “now within reach” and must still be brought in.
Commenting, Mulholland said:
“I broadly welcome the announcement and know that many publicans around the country will be delighted by the reforms proposed by the Department for Business, Innovation Skills (BIS). I particularly welcome the fact that the reforms are based on the principle of fair dealing and the principle that ‘a tied tenant should be no worse off than a free-of-tie tenant’. The proposed reforms are a huge win for campaigners and tied tenants, and all the reform needed is now within reach. It is vital government goes further and makes the free-of-tie option mandatory. This is what came out of last April’s consultation, and has been called for by the House of Commons BIS Select Committee, the Federation of Small Businesses, and many other pub sector groups.”
Simon Clarke of the Fair Pint Campaign added:
“Confirmation in the Queen’s speech that the pub industry will finally have a statutory code and an adjudicator could see a new beginning for the prospects of the Great British pub. The codes terms need to be ‘meaningful and material’ as promised by the Government and the adjudicator truly independent of undue influence by the rapacious companies that have brought the pub industry to this sorry state of affairs today. What British pubs need is the flexibility to enable them to evolve to the changing demands of a modern society. Archaic contracts need to be capable of amendment to render unfair terms unenforceable and I welcome that the coalition Government have realised that only strong legislation supporting their own primary objectives- of fairness and ensuring a tied tenant is no worse off than if they are free of tie- will offer a brighter future from the spiraling decline of pubs in this country. A strong code will inject confidence and attract entrepreneurial flair and be the catalyst for a pub revival.”
CAMRA’s Head of Communications Tom Stainer said:
“We are delighted that after our 10 year campaign the Government is now introducing a Pubs Adjudicator to protect the nation’s pubs. With 28 pubs closing a week it is vital that publicans, who are on the frontline of keeping our valued community pubs open, are given protection from heavy handed business practices from the big pubcos.”
Peter Bradley of Licensees Supporting Licensees (LSL) further commented:
“Licensees Supporting Licensees are delighted that the Government has taken long-awaited and much-needed action against pubcos and their unscrupulous business practices. For too long pubco tenants have taken the sharp end of the spile, struggling to make a decent living, whilst pubcos have systematically stripped pub landlords of their profits and stripped communities of their heritage. It should never have been the tenants’ responsibility to clear debts created by reckless, bullying, profiteering pubcos. Licensees have grafted hard, whilst the pubcos took all the reward, resulting in thousands of pubs closing, thousands losing their jobs and the lives of many pub owners left in ruin. Now, finally, we have a Business Secretary who has listened. Pubco tenants have finally been heard. Glasses will be raised by tenants and their loyal customers in celebration. “Time at the bar for dodgy pubcos!” It’s time for a fair deal. “
Gareth Epps, who has played a key role in the Fair Deal for Your Local campaign, also said:
“This is a victory for people power – for the consumer and publican against the greed of irresponsible companies. It is an important step forward that will protect pubs and tens of thousands of jobs. For years the industry vested interests that campaigned to preserve the antiquated rogue practices of the pubcos never had to make their arguments in public due to special access. Now they will have to come out into the open and defend the indefensible.
“However, the principle that a tied publican is no worse off than free of tie is key to this being particularly welcome news to licensees, consumers and Britain’s burgeoning craft beer sector. We do need to make sure the Bill has a level playing field, defined on the face of the Bill, with the full Market Rent Only option overwhelmingly supported in the BIS consultation. Without it, publicans will be able to see how unfair a deal they are getting for the first time, but still won’t be able to do anything about it.”
Chief Executive of Forum of Private Business, Phil Orford also said:
“The Forum of Private Business is pleased to at last have a response from government on this long running issue. An adjudicator should help enormously in the area of PubCo issues, though we will continue to press for further reforms of the industry, not least the free of tie and market rent only options for landlords. However, in the short term we urge the government to push through the adjudicator as soon as Parliamentary time allows. ”
1. For more information, contact Mo Saqib (Parliamentary Researcher to Greg Mulholland MP) on email@example.com or 0207 219 3833.
2. Greg Mulholland is currently away in Ecuador on a charity expedition for the Royal British Legion. More info here: http://www.justgiving.com/TRBLEcuador2014