Unintended consequences of new pub planning laws

Pubs currently fall within the A4 planning use class, meaning they can be converted to supermarkets, shops, or demolished, without planning permission or any community consultation. A coalition of campaigners​, which include MPs, community groups and the Campaign for Real Ale, say this has led to “predatory purchasing” by supermarkets and viable pubs disappearing without local people getting a say.

Hopkins said the enhanced protection provided the right balance between protecting community pubs, while avoiding blanket regulation which would lead to more empty and boarded up buildings.

“Blanket regulation could also have adverse consequences on the asset value of pub buildings, harming the financial viability of the pub industry. This Government recognises the economic, environmental and social benefits of allowing redundant buildings to be converted into productive uses without excessive red tape,” he said.

Spiked​

The Government was stirred into action following an amendment tabled to the Infrastructure Bill by Save the Pub Group MPs which would have removed permitted development rights for all pubs, not just those ACV-listed. Perhaps fearing another Commons defeat masterminded by Greg Mulholland, following his stunning market-rent only victory in November, Hopkins revealed the Government compromise, spiking the campaigner’s guns and resulting in the amendment being defeated by a margin of 48 MPs.

While the move has been welcomed in some quarters as a modest step forward in protecting pubs, many in the industry with in-depth experience of the ACV process have warned the new proposals will have harmful unintended consequences for the sector.

Peter Lawson, head of hospitality and leisure at planning consultancy Turley, said the plans, if adopted, will lead to a surge in applications by communities to have their local listed as an ACV, even in cases where it is clear that the ongoing use of the premises as a pub is wholly unviable. 

Frustrate​

“This will in turn frustrate attempts by operators to maximize the value of existing pubs prior to their disposal by obtaining planning permission for an alternative, higher value, use, and will result in them having to sell pubs at a lower existing use value reducing returns for re-investment in new projects or existing more viable pubs.

“Everyone understands the importance that local pubs play in our society, but these measures are unlikely to save unviable pubs and will further frustrate development. This is not good news for the pub companies and breweries,” Lawson said.

Steve Culverhouse, a former licensee who now runs consultancy Changeofuse.com, said many local authorities are unaware of the impact an ACV listing can have on a pub and its owner. He claimed a listing is an encumbrance on the ownership of the property and can reduce market value by up to 30%.

Currently there are about 600 ACV-listed pubs across the country. “It would be interesting to know how many have been successfully purchased by the community and are being run by them. Many listings are politically motivated so as to block planning applications including partial development of the property and nominees have even been known to apply for listing just because they dislike the pub’s landlord,” said Culverhouse.

Delay​

This sentiment is echoed by Simon Hall, director and head of pubs at Fleurets, who said ACV listings have resulted, in some cases, of the loss of a valid purchaser for continued pub use. He pointed to sale last year of a pub in Suffolk that lost two interested parties who wanted to buy it and continue to run it as a pub, because they were not prepared to wait and had concerns over the potential resale in years to come. The pub was eventually sold for use as an antiques centre and for part residential use.

“In cases where there is a clear, higher alternative use value, the ACV listing is little more than an irritant and delaying factor in the sale process, as any community offer can be rejected without reason. In these cases, existing planning legislation would have much more of an influence on future use,” he said.

“As a result, one might conclude that the planning system is better placed to control the future use of pubs. In fact, it has, for many years, been an effective means of preventing the loss of ‘the last pub in a village’ situation and often achieved the same goal without the need for additional legislation.”

Safeguard​

The British Beer and Pub Association is also critical of the Government’s proposals, saying the changes would be an “additional burden” which other sectors do not face. Chief executive Brigid Simmonds said: “It would be hard for small independent pubs who find can find small community premises difficult to sell.

“We already have adequate safeguards, through the community right to bid legislation, which offers protection against pubs being converted to other uses against the wishes of the local community, and can also give local people the right to buy the premises.”

Interestingly, the ALMR’s response was more favourable, labelling the additional protection a “sensible and pragmatic approach” which avoided tying up the whole market in red tape.

“What we do not want is a scenario in which viable, economically beneficial pubs, bars and restaurants are being closed without opposition. Nor do we want to see vacant buildings being allowed to sit empty and unused,” said chief executive Kate Nicholls.

'Unworkable​'

Brakspear chief executive Tom Davies was blunter. Speaking to the PMA's​ sister publication M&C Report​, he said the proposals were “deeply worrying”.

He said: “The Campaign for Real Ale are experts in beer and have done a lot of good in that area but they are not experts on running pubs. They take the stance that any closure or conversion of a pub must be opposed. That is unworkable. If you have three pubs in a village that are struggling to survive, isn’t it better that one remains rather than all three becoming unviable?”

After several months of radio silence, it seems the man heading the pubs ministry has been jolted into life and is now keen to reinforce to voters the Government’s pro-pub credentials through this new legislation, no matter how wrongheaded it might prove to be. Anyone would think there’s an election on the horizon…