Analyst: CAMRA's beer tie fight is illogical

The Campaign for Real Ale's (CAMRA) fight against the beer tie is "illogical", one city analyst has claimed.

Douglas Jack of Numis said that removing the tie would reduce pub product range, investment, support and supply, driving up prices as a result.

"CAMRA is not helping tenants or consumers by attempting to drive down pub profitability through transferring purchasing power to the brewers," he said.

"Now that all parties have agreed to the RICs guidelines on rent setting, it should be campaigning for extended central purchasing to reduce pub costs and therefore prices, boosting pub and tenant profitability in the process. Thus, its beer tie stance is illogical."

Jack also said that some of CAMRA's claim that the beer tie had inflated price to the counsumer by 50p a pint was "fictitious". He said that the average beer price across Punch and Enterprise pubs at 30 September was £2.62 a pint — 3% above the average of £2.54 a pint. The average freetrade price was £2.56, according to CGA figures.

Punch and Enterprise's average beer price is also below the average in the tenanted sector of £2.73 "reflecting higher purchasing power that is passed on to tenants through investment and support".

Jack also highlighted that the tenanted sector has a "significantly lower" closure rate then the free trade — 12 a week compared to 22 a week, according to the latest BBPA stats. Critics have, however, pointed out that the closure statistics do not include business failures in the tenanted and leased sector.

He said the key for Punch and Enterprise was disposing of tail-end sites, which he expects to have taken place over the next year.