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Action Needed To Save 4,000 Local Pubs

Thursday, August 29, 2013

Parliament Needs To Act To Save 4,000 Local Pubs Which Good Pub Guide Says Are Likely To Close Next Year Says GMB

Sky high rents means a pint is 80p higher than justified by inflation and  changes in taxes since 1987 and is pricing pubs out of the market and they have closed in droves and no money is left for investment for those still open says GMB

GMB, the union for tied pub tenants, commented on the report from Good Pub Guide 2014 that 4,000 pubs are likely to close in the next year. See notes to editors for story on Press Association.

Steve Kemp, GMB political officer, said “The report identifies that there are thousands of pubs that have not been refurbished and where the offering to consumers is out dated.

The report does not identify the root causes as to why these pubs that survived the depression and the war have been starved of investment. Action to address the root causes rather than closing them is the answer for staff and for local communities.

Highly indebted property companies own over half of Britain’s pubs. These charge sky high rents to tied tenants of pubs pay interest on massive financially engineered debts. These debts are held mainly by bondholders in offshore tax havens.

Interest payments on these huge debts have to be paid each week before the tenant pours a pint and regardless of whether s/he can make ends meet or not.

To pay these sky high rents a pint of lager is on average 80p per pint higher and ale is 65p per pint higher than justified by inflation and like for like changes in taxes since 1987.

This is pricing pubs out of the market and they have closed in droves. No money is left for investment which is why the pubs still open have not been modernised.

BIS has promised that Parliament will legislate a free of tie 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 rents charged by pubcos. See notes to editors 2 for BIS press release.

We need Parliament to legislate the option to allow tenants to buy products on the open market and pay a fair rent for the building.”

End

Contact Steve Kemp GMB political department on 07730 898 102 or GMB press office 07921 289880

Notes to editors

1 Story on press association

'4,000 BAD PUBS LIKELY TO CLOSE'

This story is embargoed until 29 Aug 2013 - 00:01

published 28 Aug 2013 - 10:40

By Alan Jones, Press Association Industrial Correspondent

Embargoed to 0001 Thursday August 29

Up to 4,000 pubs will close in the next year - but they are ones "stuck in the 1980s", offering indifferent drink and food, according to a new guide.

The closures are bad news for staff and customers, but it is high time "bad pubs" went out of business, giving visionary and energetic licensees a chance to open new ones, it argues.

The Good Pub Guide 2014 predicts that more than 1,000 new pubs will open next year, often in former hostelries which have been shuttered for years.

Between 2,500 and 4,000 will go out of business, but the guide quotes a successful landlord saying there are too many pubs in the wrong place, chasing the wrong market.

"The bad pubs are still being culled, just like lions pick off the slowest of the herd. It makes the pub industry more robust and far better placed for the future," he said.

The guide said standards are improving in pubs, amid increasing vocational training among staff, but it called for pubs to name their chefs on menus as part of moves to close the "absurd status gap" between TV chefs and those working in pubs.

A survey by the guide showed a 65p difference in the price of a pint of beer between Staffordshire (the cheapest) and London (the most expensive), with the average pint across the UK costing £3.20.

When the guide was launched in 1983 there were a handful of national beer brands, but now more than 7,000 beers are on offer, produced by hundreds of brewers.

Beer brewed by pubs themselves, on the premises, typically cost 40p a pint less than the local average, the guide found.

The Pub of The Year was named as the Olive Branch in Clipsham, Rutland, with other awards including the best landlord (Tim Gray of the Yew Tree in Lower Wield, Hampshire), brewery (Fuller, Smith & Turner), new pub (Bulls Head, Mottram St Andrew, Cheshire), dining pub (Stagg, Titley, Herefordshire) and whisky pub (Bon Accord, Glasgow).

More than 4,700 pubs are featured in the guide.

Ends

2 Copy of press release issued by Business, Innovation and Skills Committee

Select Committee Announcement No.16 Monday 22 July 2013

NEW REPORT: Consultation on a Statutory Code for Pub Companies

There can be no more delays in establishing a Statutory Code for pub companies, say MPs

A Bill establishing a statutory code for pub companies should be brought forward at the earliest opportunity, says the Business, Innovation and Skills Committee in a Report published today. The Committee welcomes the Government’s consultation on a Statutory Code of Conduct, an action it recommended in 2011, but warns that there can be no more delays in resolving the matter and bringing forward legislation.

Whilst welcoming the Government’s intention to include within the Code the principle that a tied tenant should be no worse off than a free-of-tie tenant, the Report states that further clarity is needed on how this will be achieved through legislation. The Committee is also supportive of the inclusion of a mandatory free-of-tie option.

The Adjudicator which will oversee the Statutory Code should be given the full suite of powers, including the power to fine, states the Report. At the same time, the Committee notes that PICAS and PIRRS have been positive developments in the pub industry and urges the Government to ensure they are retained in the new statutory framework.

Commenting on the Report, Adrian Bailey MP, Chair of the Business, Innovation and Skills Committee, said:

“The Government has belatedly come to the right decision and consulted on establishing a statutory code and an Adjudicator. I welcome this action and only wish it had come when we first recommended it almost two years ago.

“The Government must now bring forward a Bill at the earliest opportunity and certainly no later than the start of the next parliamentary session. Any more delays would be unacceptable, we have waited long enough.

“The principle that a tied tenant should be no worse off than a free-of-tie tenant is sound. But clarity is needed on how this will be achieved in practice.

"The BBPA is against the inclusion of a mandatory free-of-tie option and highlights the benefits of the tied model. We believe a free-of-tie option should be included in the Code. If the tied model delivers significant benefits it has nothing to fear—it will continue to be an attractive model for lessees and the free-of-tie option will not be taken up.

“The effectiveness of the Statutory Code will be seriously undermined if overseen by a toothless Adjudicator. The Adjudicator should be given the full range of powers, including the ability to impose fines.”

The Report’s other conclusions and recommendations are:

· The Government proposes that the Statutory Code should apply to companies which own more than 500 pubs. Whilst seeing the rationale for setting a threshold, there is merit in including a level of flexibility to allow the Secretary of State subsequently to alter the threshold in the interests of the industry [paragraph 38].

· The Statutory Code should only apply to pub companies with leased and tenanted pubs. The Department should reflect this in the Bill [paragraph 39]

--ENDS--

FURTHER INFORMATION:

Committee Membership is as follows:

Chair: Mr Adrian Bailey MP (Lab) (West Bromwich West)

Mr Brian Binley MP (Con) (Northampton South) Paul Blomfield MP (Lab) (Sheffield Central)

Katy Clark MP (Lab) (North Ayrshire and Arran) Mike Crockart MP (Lib Dem) (Edinburgh West)

Caroline Dinenage MP (Con) (Gosport) Julie Elliott MP (Lab) (Sunderland Central)

Rebecca Harris MP (Con) (Castle Point) Ann McKechin MP (Lab) (Glasgow North)

Mr Robin Walker MP (Con) (Worcester) Nadhim Zahawi MP (Con) (Stratford upon Avon)

Media Information: David Foster fosterda@parliament.uk 020 7219 7556/07917 488729

 


 

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