The union of more than 1m members, which claims to be the largest in UK and Ireland, issued a joint plea with the British Pub Confederation on 15 May for large pub companies to cancel rent or “face the collapse of thousands of pubs and the loss of hundreds of thousands of jobs”.
According to figures cited by Unite, approximately 20,000 of Britain’s 40,000 pubs – which support close to 500,000 jobs – are leased to tenant operators.
While each of the six pub companies that fall under the pubs code’s jurisdiction have outlined plans to support tenants through the crisis and signed a joint declaration to preserve tenant rights, none have written off rent accrued during the pandemic pub shutdown across the board.
“Unite has many members within the pub industry who are on the breadline,” Unite national officer for food, drink and agriculture Joe Clarke said. “They are not being supported by the pub companies, which are still asking for rent or allowing publicans to amass huge debt by deferring rent payments.
“Because of this, the limited Government support available is unlikely to secure a long-term future for many publicans or their staff. This will also have a devastating impact on the beer production and delivery sector.
“Pubcos need to think long term and cancel rent payments for self-employed publicans or face the collapse of thousands of pubs and the loss of hundreds of thousands of jobs.
“There needs to be a structured Government-led plan for the industry, and this must include the voice of tenant publicans and staff representatives, not just that of the large pubcos.”
Need to ensure the industry survives
After Unite added its voice to the calls to cancel pub rent, British Pub Confederation chair Greg Mulholland – who has joined tenants in pushing for rent cancellation under the online #Nopubnorent campaign – added that he believes the way self-employed pub tenants are being treated by large pubcos and breweries is “scandalous”.
“These corporations are charging rent on closed pubs with no income,” he said.
“Worse still, they are asking tenants to hand over their Government grants. These funds are intended to enable the pub and publicans to survive, not for pubcos to line their own pockets and those of their shareholders and prop up questionable corporate structures.
“The message from the British Pub Confederation and Unite is clear: pubcos must cancel rents during the crisis and stop trying to get their hands-on grants meant to ensure these pubs have a future.
“The Government needs to step in with a plan to facilitate this and ensure the industry survives.”
Grant purpose ‘explicit’
However, in response to growing calls for pub companies to write off rent during the Covid-19 shutdown, the British Beer & Pub Association’s chief executive Emma McClarkin told The Morning Advertiser (MA) in April that the Government had been clear in its intention for grants to be used to cover fixed costs including rent and that cancellation would leave the sector in disarray.
“When announcing this vital support for the UK economy and businesses, Chancellor Rishi Sunak was explicit: ‘Businesses have fixed costs that we will target support at – most of these have two major fixed costs: rent and staff’,” she explained.
“On the purpose of the grants announced in the support package, he was even clearer that the ‘… grants we have given actually provide a lot of cover to cover those fixed rental payments’.”
“This means pubs, like other businesses, have the support they need to continue to meet their fixed outgoings – supporting the entire business ecosystem.”
What’s more, after the Government’s 50-page Covid-19 recovery plan revealed that ‘at least some’ pubs could open as early as 4 July, UKHospitality’s chief executive Kate Nicholls told delegates at MA’s digital MA500 conference that Government support for the sector should extend until the end of the year – if not into 2021.
“UKH is calling for the Government to guarantee furlough, grants and loans extended. As we go into recovering period in 2021, we need to ensure the business rates holiday is extended so we don’t cripple with an overload of debt from rent and rates.
“[We need a] gradual evolution of those schemes and making sure those schemes are supported.”