Licensees fight back at committee meeting

Licensees lashed out at pubcos and the beer tie when giving evidence at the Trade and Industry Committee meeting this morning (Tuesday, 22 June).

Three publicans holding tenancies with either Punch or Enterprise attacked the beer tie and called pubcos "arrogant" and "bullies" as they addressed MPs during the first oral evidence session.

The meeting, taking place at Portcullis House in Westminster, London, got the investigation off to a positive start for licensees after an unprecedented 330 had written to the committee.

The speakers told MPs that pubcos were squeezing all they could out of tenants and that the cost of beer compared to the rent paid was no longer a fair balance.

Richard Harvey, a multiple lessee who runs three Punch pubs including the Queens Head in Stratford-upon-Avon, Warwickshire, said: "The argument for pubcos has been that higher beer prices are supplemented by lower rents. That might have been the case in the past but it isn't any more. Pubcos are arrogant in their demands to increase rents and have now gone too far."

Mike Benner, chief executive of the Campaign for Real Ale, also gave evidence and emphasised the need for tenants to have better access to beers from smaller breweries through guest beers.

Arthur Jacobs of accountancy firm A B Jacobs & Co also addressed the committee and requested an end to the tie completely.

Mr Jacobs said: "Rents should only be set on the basis of the profit achievable, taking into account trends and history."

The committee investigation is looking into the link between wholesale beer prices and those charged by the major pub companies.

It is also looking at the basis on which rents are set and increased and their impact on struggling tenants.

Further oral evidence sessions will take place on July 6 and July 20.

Related articles:​

Pubcos under fire in the Commons (22 June 2004)

Hearing on beer tie investigation (15 June 2004)

MPs' probe swamped with evidence (7 June 2004

FSB attacks pubco profits (3 June 2004)

Parliamentary probe into pubco-tenant relationship (7 May 2004)