No benefit to pubs in energy shake-up

The vast majority of pubs will not benefit from a new scheme to protect against being ripped off by energy suppliers.

Government has said that small businesses will be included in the forthcoming redress scheme to resolve consumer complaints, which begins in October.

But only firms that use less than £5,000-worth of electricity or gas per year will get to access the service for each utility - so hardly any pubs will benefit.

The move is a huge blow for licensees, who could find they have even less protection from being exploited by energy suppliers.

The scheme will see an independent ombudsman charged with resolving consumer complaints. Energy suppliers will be legally bound to take part.

The Department for Business, Enterprise & Regulatory Reform (BERR) rejected plans to include all firms employing fewer than 10 staff and with turnover under E2m. This would take in all but the largest pubs.

Suppliers said the decision should be based on consumption because this information would be more reliable and make it easier to identify who is covered by the new arrangements.

A BERR spokeswoman said the decision had been made but it is "not set in stone", which gives hope that the policy could be abandoned.

The change comes as part of a wholesale reform of major consumer watchdogs, which are to be abolished in October and replaced with one body, the National Consumer Council (NCC). Energywatch is to disappear in September and the NCC will take on its responsibilities, with the exception of complaints handling.

However, other forms of protection may still be available to pubs. This could include a new system of complaints handling from the NCC, although only those facing disconnection from supply could take this service.

"We are really pushing [energy regulator] Ofgem to ensure suppliers to small businesses are covered," said Audrey Gallacher, Energywatch's head of company performance, research and advice.

Energywatch is also lobbying the Office of Fair Trading to allow small businesses to seek help from advisory service Consumer Direct.

missed chance

Fewer than one in four Punch leased pubs would be protected under plans for the redress scheme, the pubco estimates.

"We are missing the chance to protect the significant majority of our leased pubs," said Punch's legal and estates director Neil Martin. "It is very disappointing."