So the government has, after all that, decided the pub industry cannot be trusted to regulate itself, and is proposing a statutory code and independent adjudicator to ensure landlords treat their tenants fairly.
The industry, or at least the part represented by the British Beer & Pub Association, is exasperated at the surprise move. It has already set up new structures to deal with complaints and its code of practice is currently on its sixth draft.
Personally, though, I think the government is doing broadly the right thing. If it had only done it sooner it would have saved a lot of bother. In fact, the previous Labour Government, which was making a lot of noise about the need to take action in the days leading up to the announcement, could have done something itself when pubco practices were more inflexible than they are today.
My suspicion is that it is somehow tangled up in the survival of the coalition. Did the Tories concede the principle self-regulation to its partner in a policy swap? Perhaps we’ll never know, but LibDem business secretary Vince Cable seems to have taken more trouble than most politicians to get a good grasp of the issues. It’s significant that he chose not to include a statutory right to a free-of-tie option. This is not a threat to the tied house system as such.
Important questions remain, however. The main one being exactly which pub operators and which pubs come under the legislation.
“The Code is expected to apply to all pub companies which own more than 500 tied leases,” says the Department for Business Innovation & Skills. In the pub industry ‘lease’ is shorthand for the long assignable leases introduced as an alternative to the traditional tenancy. If that’s what the BIS means only two companies, Enterprise Inns and Punch Taverns, will be affected.
Cable, however, said in Parliament that six companies will be subject to the new regulation. This suggests that ‘lease’ here includes tenancies. It makes sense, too, because the 500-pub threshold neatly excludes family brewers, who are reckoned to have a better relationship with their licensees and would feel the burden of regulation more heavily.
If I’m right the New Big Six (the old Big Six were the brewers who dominated the industry before the 1989 Beer Orders) are: Enterprise, Punch, Marston’s, Greene King, Star Pubs & Bars and Admiral Taverns (Trust Inns sits just about the threshold but can easily dispose of a few pubs to get under it).
Where the line is drawn will be debated in the consultation period, but as it stands there appears to be logic to it.
However, isn’t true that all the problems lie with the bigger pubcos? The tenants of family brewers need protection, too, and the Association of Licensed Multiple Retailers has suggested that a voluntary code should remain for them.
What none of this will do is have a dramatic impact on the rate of pub closures. The damage has already been done and the challenges faced by publicans reach far beyond the tied house system.