Blair's red-tape pub trade legacy

As Prime Minister Tony Blair prepares to step down after a decade at the top, Nigel Huddleston talks to the trade about his time in office

Tony Blair's stormy relationship with the drinks industry began with the now-infamous text message sent to voters before the 1997 general election which urged: "Vote Labour if you don't give a XXXX for last orders."

Blair proved good on that particular promise, though it took eight years to get round to delivering it as licensing reform and other trade issues proved too complex to solve with a cheeky soundbite.

The Blair years have encompassed extended hours, the smoking ban, moves towards national ID, alcohol disorder zones, war on irresponsible drinks marketing and much more besides. But it's the new Licensing Act that most pub operators feel Blair will be best remembered for - though not fondly.

Policy on the hoof

Peter Linacre, managing director of the Massive Pub Company, described the legislation as a "complete and utter disaster". He says: "The Government has been a major contributor to the red tape we face. The Licensing Act started out with the text message and it was supposed to be a liberalising piece of legislation. But because Blair wasn't committed to it, it became highly restrictive and completely in hock to the readers of the letters page of the Daily Mail.

"If Tony Blair went to the pub I'm sure he'd be a great bloke to have a drink with, but the problem is that whenever he sets out to do something and it comes under public scrutiny, he just changes his mind."

Linacre said the Government's approach to beer duty didn't bode well for the trade if Gordon Brown turned out to be Blair's successor in the end.

"The Government would appear not to understand that they make less by putting up beer duty than they would if they left it alone," says Linacre.

Asked if there is anything positive for the pub trade to take comfort in from the Blair reign, Linacre replies with a lengthy silence. Marks out of 10 for Blair overall, then? "Three, for being a nice bloke."

Chief executive of the Wine & Spirit Associa-tion Jeremy Beadles agrees that "the agenda has become increasingly media-driven".

He adds: "Repeated headlines in popular daily papers have had ministers directing civil servants to develop immediate solutions. Despite repeated reassurances to the contrary, policy is not usually pegged on evidence-based research. It is often distorted to fit the political and media agenda of the day."

Beadles said there had been "an increased willingness" to consult the industry, but with mixed results. "Long, protracted discussions over many months have resulted in the Government imposing unpopular and impractical legislation, such as alcohol disorder zones," he says.

Chief executive of the Tynemill pub company and Castle Rock brewery, Chris Holmes, gives the Prime Minister a score of just two out of 10 and says he would be "delighted to see his departure".

He adds: "In many ways the general culture of the industry has deteriorated. Taking pubs away from magistrates and putting them into the hands of local councils has been disastrous, because of the cost and the ridiculous bureaucracy that we have."

Blair's successor

Holmes is not a fan of the new smoking regulations either. He believes they could have been handled better.

"The representations from the industry went against a total ban and we supported that. Arguably, this goes against the interests of the traditional pub, but works in favour of the mega-pub companies that do a lot of food," he says.

"The only thing that worries me is that Gordon Brown is likely to be taking over. The only decent thing he's done is progressive beer duty. In future, I'd like to see a lot less centralisation and for local authorities to be left alone to get on with the job."

Thorley Taverns' managing director Frank Thorley echoes some of Holmes' sentiments but gives Blair a more generous end-of-term mark of four out of 10.

He says: "Taking control away from the licensing justices and giving it to local government was a retrograde step.

"The people doing it before were experienced and had usually gained the respect of the licensed trade. The problem with the people in a local council is that they can often have another mission or reason behind a decision. Certainly, in the early days of the new laws coming in, we were dealing with people who knew little or nothing about it."

He goes on: "They banged the drum about 24-hour opening but how many places are open for 24 hours? In a lot of places it is allowing people to stay out later but they're also going out later [to start with]. It means pubs are taking the same as before but with greater overheads. They've given people permission to drink later in pubs but not more money to spend in there."

But not everyone is so critical of the Blair legacy. Consumer group the Campaign for Real Ale said Blair's administration had introduced some positive measures for beer drinkers and small brewers.

Head of public affairs Jonathan Mail says: "It's broadly quite positive but there have been some missed opportunities. The introduction of small brewer's relief [progressive beer duty] has delivered £15m to small brewers.

"He also introduced mandatory rate relief for rural pubs, which has helped to keep a lot of them open and viable."

Overall, the Prime Minister scored a creditable eight out of 10 from Mail for his performance over 10 years.

A mixed legacy

Secretary of the All-Party Parliamentary Beer Group Robert Humphreys thinks Blair's legacy is mixed. "The Government was craven in the way it gave in to the media onslaught over binge drinking - it could have stood up to the Daily Mail lobby. By not doing so, it completely changed the tenor of the Licensing Act.

"However, it does seem to be having an impact on binge drinking.

"Elsewhere, the minimum wage has been unpopular in our business, but it has benefited many pub customers, so the pub owners have probably had their extra costs handed back in spades through the till," he says.

"And we may eventually see that the smoking ban is good for the trade."

Pub operators seem most mindful of the rising tide of red tape. A typically robust and succinct assessment of the Blair reign from chairman of Ultimate Leisure, Mark Jones, perhaps sums up the feelings of many in the trade: "After 10 years, he has left the industry bloodied and bruised, but unbowed."

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Blair presides over a period of rising trade costs

Payroll costs have risen by 10% over the past decade as a result of rises in the national minimum wage, according to a benchmarking survey of 39 members of the Association of Licensed Multiple Retailers.

Salaries and wage costs account for 27% of turnover - the biggest single overhead for companies. Meanwhile, the average cost of running the average pub is now 50.7% of turnover without rent.

The other main finding is confirmation of the substantial increase in utility charges - they now amount to over 4% of total operating costs.

A key element of staffing is the money currently being spent on door staff and other compliance requirements as businesses respond to the challenge of responsible drinks retailing.

ALMR chief executive Nick Bish says: "The results suggest that the costs are far more significant than most people would assume, and certainly more than most accounting practices allow for.

"And with the survey suggesting like-for-like sales up only 3.7%, it's easy to see the impact this will have on business margins."