Letter to the chancellor, George Osborne

Sent: Monday, 8 April 2013, 23:09
Subject: Pub Industry Statutory Code of Practice

Dear Mr Osborne

I’ve been in the licensed trade for almost 30 years. I have successfully operated numerous restaurant, bar and pub groups. I’m a founder member of the Fair Pint Campaign and a current steering group member of the Independent Pub Confederation (IPC).

Along with many others, I was shocked to read in the Mail on Sunday that you may be looking to block plans to introduce a pub industry statutory code of practice.

In recent years pub businesses have been failing in unprecedented numbers. Much of the damage being caused to publicans, and the cause of so many of these pub failures, is the abuse of the beer tie and rental valuation systems by companies such as Enterprise Inns, Punch Taverns and brewers that copy them such as Greene King, Marstons and Shepherd Neame. Organisations like the British Beer & Pub Association (BBPA) may wish to promote ‘other issues’ such as duty and supermarket pricing as the reasons for pub failures but this simply isn’t true. Higher taxes may not help but they aren’t closing pubs.

The BBPA does not represent publicans. It is paid for by property companies and brewers. The so called Beer Group (APPBG), Chaired by Andrew Griffiths and managed by Robert Humphries, is paid for by those same parties and does not represent publicans. For far too long both of these organisations have pretended to represent the interests of real publicans whilst in fact furthering the interests of a small number of larger benefactors such as Enterprise Inns and Marstons. In truth, the BBPA and the beer group are far too conflicted to present a true and complete picture of the problems faced by pubs and it does not help with the real issues, nor does it confer credit on Government, when the treasury seems so ready to be part of the smoke screen being thrown up by the BBPA, the pubcos and the beer group.

The statutory code was set to level the playing field between tied and non-tied tenants and breathe life back into a sector that has been virtually destroyed by the greed of a few. Vince Cable’s much needed solution, originally put forward by Peter Luff, was all about preserving jobs, livelihoods and community assets. It was about looking for a fair deal for small businesses in a sector that has become dominated by a small number of property companies and large regional brewers. Whilst we are all looking for a statutory code to ease the pressure for tied publicans, we are still losing hundreds of millions of pounds each year to pub companies in order to support the unsustainable debts they took on in the first place. Much of this money, so needed for investment in the sector, is simply paid away offshore to bondholders. This simply can’t be right.

The sector is at a crossroads and a statutory code, with the correct content, will put the industry back on the road to recovery. It will create necessary change and promot a way forward that offers greater protection for existing publicans and newcomers to the industry such that they do not suffer the extraordinary level of exploitation that has been seen is so many cases up and down the country. We have had four select committee inquiries all screaming for change yet the abuse leveled at tied publicans still goes on today. It seems that Vince Cable, Jo Swinson and other like minded MP’s who care about pubs and publicans are keen to see change that will loosen the grip of the property companies that care very little indeed about the future of the cultural icon that is the Great British Pub.

A statutory code of practice that enshrines in law the principle that the tied tenant should be no worse off than if they were free of tie is the only supportable position. I hope you will agree.

Yours Sincerely

Stephen Corbett