Statutory Legislation is now to the forefront.
Business, Innovation and Skills Committee
Select Committee Announcement No.39
Wednesday 9 January, 2013
For immediate release
Government to implement Committee recommendation and consult on establishing statutory Code and Adjudicator for pub companies.
The Secretary of State for Business, Innovation and Skills has written to Adrian Bailey MP, Chair of the Business, Innovation and Skills Select Committee, to inform him that the Government is to consult on establishing a statutory Code and Adjudicator to oversee the relationship between pub companies and licensees.
This is in accordance with the recommendation of the Committee in its September 2011 report,Pub Companies.
Commenting on the letter, Mr Bailey said:
“The relationship between pub companies and their lessees has been the subject of regular and sustained scrutiny by my Committee over recent years.
“During this period, the industry time and again failed to address the areas of concern raised by us and deliver meaningful reform. Opportunities to put its house in order were squandered.
“In our most recent report on the issue, frustrated by the glacial speed of progress, we asked to Government to keep to its undertaking to consult on establishing a statutory Code and Adjudicator, if we so recommended
“I am pleased the Government has now agreed to this and welcome the Secretary of State’s letter. I also welcome his acknowledgment of the pivotal role my Committee has played in the development of policy in this area.
“The Secretary of State is expected to appear before the Committee in the near future. I look forward to that opportunity to discuss the consultation in more detail, including the proposed timetable.”
Notes to editors:
In its 2011 report, Pub Companies, published on 20 September 2011, the Committee stated:
The position of the previous Government—endorsed by the current Government—was that if we so recommended, it would consult on how to put the Code on a statutory footing. It is now time for the Government to act on that undertaking. In its response to our Report, the Government has to set out the timetable for that consultation and begin the process as a matter of urgency. We further recommend that the consultation includes proposals for a statutory Code Adjudicator armed with a full suite of sanctions. Considering the amount of evidence gathered by us and our predecessor Committees this should not be a lengthy process; and given the Government’s undertaking to us we do not anticipate any meaningful delay. Furthermore, we caution the Government that offering a compromise of nonstatutory intervention would be a departure from its undertaking to us and would not bring about the meaningful reform that is needed. [para 157]
The full report can be accessed on the Parliament website via the link below:
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)
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The publican and Fair Pint campaigner Simon Clarke put it like this: “For far too long, tied pub tenants have been abused by big pub-owning companies. Many have lost their livelihoods, savings and have lived in fear of losing their home. This announcement comes after many years of highlighting this unfairness.”
For many individuals, it is more than a mere pity it took so long. I got to know a guy a few years ago who had packed in a successful, lucrative trade in the music industry to pump his considerable fortune into running what he thought was a lovely Sussex pub. Three years later, he was divorced and living in a council flat. He hadn’t seen his son for months.
Maybe he was a bad businessman, but the point is that the pubco didn’t care either way – it got its pound of flesh whether he succeeded or failed.
Mr Cable said: “There is some real hardship in the pubs sector, with many pubs going to the wall as publicans struggling to survive on tiny margins. Some of this is due to pubcos exploiting and squeezing their publicans by unfair practices and a focus on short-term profits. Four select committee reviews since 2004 have highlighted these problems.
“Last year, we gave the pubcos one last chance to change their behaviour, but it is clear that the self-regulatory approach was not enough, and in October I wrote to the industry to seek their views. A change in the law is now needed to shift behaviour.”
Back at the BBPA, they are carping that “self-regulation should have been given a proper chance to work” and pleading for the new watchdog to operate with a “light touch” to “protect consumers” from the brunt of extra costs.
There are lots of reasons why a pint of beer is an increasingly expensive thing. None of them are to do with powerful pub companies not being allowed to shove around near powerless landlords.
A rare result for the little man, then. You could drink to that.