Sunday, 13 January 2013

Labour forces government climb-down to save community pubs

Pressure from the Labour Party has forced the Tory-led government to perform a climb-down and introduce legislation to help protect struggling pubs in places like Hyndburn.

The number of pubs closing per week has recently risen from 12 to 18 and more than 200 pubs have been converted to supermarket convenience stores over the past two years alone.

Many factors have an influence, but the unfair and unbalanced relationship between licensees and their landlords, the large branded pub companies or “PubCos” who dominate the market, has undoubtedly played a part in this sad decline.

A broad coalition of groups in the pub trade – including CAMRA, the Federation of Small Businesses, the Independent Pub Confederation, the GMB and UNITE Unions, the Forum of Private Business and Fair Pint have been calling for a statutory code to guide and regulate the relationship between the PubCos and their tenants and licencees.

Labour has long supported these calls and on 12 January 2012 the House of Commons voted unanimously for a statutory code to be introduced. Despite this the Tory-led government decided to sit on its hands and ignore the will of Parliament and the broad coalition of pub industry groups.

Labour therefore called the first Opposition Day Debate of the year – one of the very few opportunities for parties not in government to decide what the House of Commons will debate and vote upon – on 9 January 2013 on the issue of PubCo regulation.

Climb-down
As recently as October 2012 the government did not believe there was a problem and the minister responsible refused a meeting request from the Publican’s Morning Advertiser on the grounds that all the government’s commitments to pubs had “now been achieved”.

But remarkably within 24 hours of Labour’s Opposition Day Debate the Tory-led government spectacularly caved in and announced that they would introducing a statutory code after all.

Pubs are vital hubs for communities in Hyndburn and are valued strongly by local people, but due to the Tory-led government’s inaction and broken promises on backing small landlords they are closing at an ever-increasing rate. The number of pub closures a week has risen to 18 and over 200 pubs have been converted to convenience stores in the last two years alone.

I welcome the fact that, after Labour called a debate on this issue and on the eve of the debate taking place, ministers have decided to think again and I was proud to vote for Labour’s motion on 9 January. However, the government still has some questions to answer and has not gone as far as many groups in the sector would like.

Work still to do
It is still unclear whether the government’s reforms will offer struggling landlords a free of tie option so they can buy their beer on the open market rather than being contractually committed to only buy their beer from their PubCo at often inflated price. The original BIS press release this week announcing Cable’s plans specifically noted that the new code “will not mandate, as some campaigners have suggested, a ‘free of tie option’ with open market rent review”. A couple of hours later this sentence had been removed from the press release on the Department’s website, leaving campaign groups like CAMRA scratching their heads as to where they stand.

The government is also refusing to consider a guest beer provision which would allow tied pubs to at least serve one guest beer at the bar. Again this was something heavily pressed for by campaign groups in the pub sector including FairPint, the GMB and CAMRA.

Finally, the government has not made clear how local pubs will be protected ahead of a new statutory code being prepared. Large pub companies could potentially see a window of opportunity to cash in on their assets whilst the new code waits to become law.

Speaking after the debate, Labour’s Shadow Pubs Minister,Toby Perkins MP said: “After a whole year of inaction and foot dragging from ministers, the government have caved in and are finally accepting what we have said all along: that ensuring fairness in the relationship between the big pub companies and their landlords will require a statutory code. Labour has led calls alongside a broad coalition for a proper statutory code to support landlords, protect local pubs and help turn around the tide of pub closures we have seen.

“However, the confusion around the free of tie option is greatly disappointing for many in the pub trade as is the absence of a guest beer provision.

“Given the huge amount of time which ministers have already wasted, it is crucial that the government moves quickly to bring forward proposals for a proper statutory code this year. We will be urging ministers to strengthen the Code by including a non-tied option for publicans, which campaigners have long been calling for.”