Pub companies ‘behaving like bankers’

These are the words of Greg Mulholland MP, speaking after an Early Day Motion (EDM) which calls on other ministers to embrace recent recommendations made by the Business Innovation and Skills (BIS) Committee, which stated that pub industry self-regulation has ‘failed’.

The Forum of Private Business is now urging MPs to back the Parliamentary motion, which aims to free landlords from being held ransom by large pubcos imposing ‘tied’ arrangements on them.

“​The market has so clearly failed and the pubs sector has been stifled and it is time to free it up allowing the British pub to thrive once again,” said Mulholland, who tabled the motion and is also chairman of the Save the Pub Group, which has persistently lobbied for action.

Irresponsible behaviour​

“It is possible to draw parallels with the banks in this country, who have behaved in a similarly irresponsible manor, for example the pub companies overvaluing of their estates and borrowing against it much like the banks speculation and ‘gambling’, which went so wrong.

“I hope to see as many as my Parliamentary colleagues as possible supporting this EDM, to portray the considerable concern with the current situation and the need for the Government to legislate, based on the recommendations of the Select Committee."

The EDM noted that twice as many pub tied pubs are closing as free-of-tie pubs and called for a guest beer option for lessees who chose to remain within tied arrangements. It argued that actions like this would stimulate the UK pub industry and the entire economy in the process.

‘Real time’ figures from the Forum’s market analyst, the Data Works, suggest that the number new pub start-ups has steadily declined over the past five years, with most new pubs that have launched located in the South East of England.

In September, the Forum’s senior policy adviser Phil McCabe said: “It is clear that pub industry self-regulation is not working to prevent large pub companies from mistreating landlords.

Tougher regulation​

“We need tougher regulation and a more robust code of conduct that allows the British pub to flourish once more. We are calling on all MPs who care about local pubs in their constituencies to sign this motion and to urge the Government to take up the committee’s recommendations without delay.”

Steve Corbett of the pressure group Fair Pint encapsulated the real urgency of the pub industry’s concerns outlined in the EDM, with a final message to business minister Vince Cable.

“We want MPs to sign up to the motion but also to write to Cable, asking him to implement the BIS Select Committee’s recommendations, which would give publicans the chance to become free-of-tie.

“This would breathe much-needed life into a pubco-ravaged sector and should be done as a matter of urgency.”

The Campaign for Real Ale (Camra) is among numerous other organisations that are also lobbying the government to back the BIS Committee’s recommendations.

Last month, BigHospitality reported that pubs are closing at a startling rate of two every day across Britain​.