UK: Government reveals plans for code of practice on beer supply rules
- Credit: PA
THE Government has unveiled moves to help pubs struggling to pay rent or beer prices with the aim of saving them thousands of pounds a year and stemming closures.
Ministers announced plans for a new code of practice and the backing of a “powerful” adjudicator following complaints about a so-called “beer tie” under which landlords have to buy supplies from the companies which own pubs, often at high prices.
The code would contain mandatory rules for all companies owning more than 500 pubs and would aim to stop abuses of the beer tie, which has been partly blamed for pub closures.
Under the proposals, the adjudicator would have the power to enforce the code and deal with disputes through sanctions and fines.
Business Secretary Vince Cable said: “We gave pub companies every chance to get their house in order... but despite four select committee reports over almost a decade highlighting the problems faced by publicans, it is clear the voluntary approach isn’t working.
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“Pubs are small businesses under a great deal of pressure, many of which have had to close. Much of that pressure has come from the powerful pub companies and our plans are designed to rebalance this relationship.
“Pubs play a valuable role at the heart of our communities and we urgently need a change to help them survive and become profitable. These plans will do just that and could save pub tenants £100 million per year by making sure that pub companies charge their tenants fair rents and beer prices.
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“The new proposals could also allow tied pubs to have independently picked guest beers and help the growth of small beer and ale manufacturers across the UK.
“The Government is committed to building a thriving pub sector. The industry represents many small businesses, employing hundreds of thousands of people across the country.”
Employment Relations and Consumer Minister Jo Swinson said: “We are committed to stamping out abuse of the beer tie and helping British pubs to thrive.
“It has been a huge concern of mine that pubs, often the hub of our communities, are closing down at an alarming rate. What is also shocking is that the figures show that almost half of tied pubs earn less than £15,000 a year, and struggle to make ends meet because of rising beer prices and rent.
“I have heard about a variety of unfair practices such as large unjustified increases in rent, and am clear that this sort of behaviour is not good enough.
“These proposals will put a fairer system in place and will make sure that tied pubs are no worse off than free-of-tie pubs. For the first time, if pubs feel they are being treated unfairly by their landlords, they will be able to complain to a powerful new body.”