Livingstone's pub loan scheme

Ken Livingstone attacked pubcos as he revealed plans for a multi-million pound loans scheme for London tenants to buy their pubs if he is re-elected mayor.

In an exclusive interview with the Morning Advertiser, Livingstone expanded on proposals to help the capital's pubs if he becomes London's mayor again.

Livingstone, who is bidding to be Labour's candidate for the 2012 mayoral election, said problems with pub landlords began with the Beer Orders in the late '80s.

"As brewers came out, international companies moved in and bought up pubs. They are property owners and have no interest in preserving the pub.

"They make them sign the contract that says they've got to buy booze from pubcos with a 50% to 60% mark-up.

"These poor buggers who think they can make a go of it find they are tied with an onerous contract. After about nine months or a year they go into liquidation and the pubco sells it on. It's wrong."

Livingstone is backing the GMB's campaign against the tie. But he is sceptical about the likelihood of industrial action by tenants having the desired effect.

Livingstone said: "I think if we can get all the [tenants] to just completely switch off [beer flow] monitoring and buy cheaper beer, the pubcos would back down, but getting a large number to do it would be difficult."

Part of Livingstone's campaign includes creating a "revolving fund" for loans to help licensees buy their pub. It is expected to be used in conjunction with standard bank loans. When asked about the expected size of the fund, he replied: "It depends how many pubs would be under threat.

"Last year 11 pubs a week were going out of business so it would probably be totalling under the tens of millions."