Fair Deal campaigners press Government on ‘market-rent-only’ option

31-Oct-2013 - Last updated on 31-Oct-2013 at 09:51 GMT

The campaign group wants to stop the ‘exploitation’ of licensees by the large pub companies

Fair Deal for Your Local - the campaign group that demands a halt to the exploitation of licensees by large pubcos - has written a letter to Business Secretary Vince Cable insisting a ‘market-rent-only’ (MRO) option for pub tenants is a simple, moderate and gradual way of splitting profits.

In the letter, GMB (the union for tied tenants) and the nine other Fair Deal members including Camra claim that the MRO option should be included in the proposed statutory code, also quashing claims from the larger pub companies that it would cause additional red tape and increased costs.

Under the MRO option, a tied licensee can choose whether to remain in the same tied agreement and pay extra for tied products and a lower rent to compensate them, or swap onto agreement under which they simply pay market rent and acquire products from any source if they consider the tied rent is not fairly reflecting the tied product prices.

The Department for Business, Innovation and Skills has already promised that Parliament will legislate the MRO option, with tenants able to buy products on the open market and pay a fair rent for the building - the aim is to lower sky-high rent charged by the pubcos.

The letter confirms that this is not only the clear solution but also a gradual one that, as well as leading to a fairer split of pub profits, would also allow the pubcos time to adjust their model as it would come into practise over a number of years.

Social justice

Steve Kemp from the GMB National Office explained that union members are now ‘relying on the right decision to be made by Government’.

“It is time for true social justice for British publicans and the pub industry as a whole,” he said.

Other pub organisations agree, with Simon Clarke from Fair Pint adding: “The ‘market-rent-only’ option is the simplest solution - it is phased, it is self-policing, and the cost would be apportioned to the parties as already provided for in the existing leases, saving the industry money.”

Clive Davenport, the chairman of FSB Enterprise and Innovation, added: “Our research shows that nearly 90 per cent of publicans want a market-rent-only option - in other words being able to buy product free-of-tie with an independently assessed fair rent.”

The Government’s verdict should be available soon following the widespread consultation on the draft statutory code over the summer.

Download the letter from the Fair Deal for Your Local Campaign here