Thursday, 10 January 2013

Many questions to be asked of the statutory code of practice for the pub industry!

Let me say at the outset, that the governments plans to introduce a statutory code of practice, and an adjudicator to regulate the relationship between pub companies and their tenants, will hopefully, lead to a fairer deal.

Over 3,500 tied pubs have closed since early 2009. And let's face it, many of that figure have closed due to excessive rents, and being forced to buy beer at way above the market rate.

I am now sure many tied tenants will now be looking forward more to 2013, as a result of these favourable proposals.

But whoa, hang on! It only affects companies with 500 or more boozers. The 'big six': Greene King, Star Pubs and Bars, Punch Taverns, Enterprise Inns, Marstons and Admiral Taverns.

What about regulating companies with less than 500 'watering holes'? Surely, these proposals are only legislating for a small segment of the 50,000 plus pubs in the UK.     

Who thought up this figure of 500 anyway? And dare I say:''What if the big boys split their estates into 'separate' companies. Small enough to gain the exemption?''Perhaps I am being a little mischievous here!

Another question: What is the governments assessment, of a tied tenant being ''no worse off than the free of the tie tenant''? Come on, as late as October 2012 they were bleating that everything was fine in the pub sector! Thankfully, they have now seen sense and done a 'U turn'. Finally, admitting that fairness is required in the relationship between the big companies and their tenants.

So, back to my original gripe. Why should a company with 499 boozers or less be exempt from the statutory code? Isn't a tied leasehold a, err, tied leasehold?

There are quite a few family brewers, smaller companies, up and down the land, who some might describe as small pubco's. Correct me if I am wrong, but don't they have the same business objectives?

Unfortunately, there will be many of these companies still charging far higher prices for beer in their tied pubs, than the free of the tie hostelries. Thus, making the statutory code of practice, in this instance, about as useful as a chocolate fireguard!

As you can see from my comments and thoughts, there are, in my opinion, still lots of questions to be answered. Let's hope that some of the points raised, do not lead to turbulent waters, for the governments current proposals.

I hope you enjoyed reading the blog. You can now record your view by voting in one of the boxes in the right hand column :-)