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UK government stalling on pub reforms, says opposition
January 21, 2014 / 5:27 PM / in 4 years

UK government stalling on pub reforms, says opposition

LONDON, Jan 21 (Reuters) - The British government was accused on Tuesday of dragging its feet over reforms to the pub industry after it rejected calls from opposition politicians to commit to new laws forcing big pub firms to treat tenants fairly.

In the UK, where almost half of the 50,000 pubs are run by tenants on closely controlled terms with landlords, many pubs have been forced to shut due to small margins and fierce competition from much cheaper supermarkets. Latest figures show 26 pubs are closing every week.

Lawmakers want a code backed by law to prevent firms with 500 or more tenanted pubs like Enterprise Inns, Greene King and Punch Taverns from abusing the “beer tie”, under which such pubs are forced to buy beer from the firms who hold their leases, often at high prices.

To ensure fair beer prices and also rent, an adjudicator would be appointed with powers to fine.

The Conservative-led coalition government outlined proposals for such a code last April and launched a public consultation whose outcome is now months overdue.

The opposition Labour Party on Tuesday criticised ministers for acting too slowly and called for them to pledge to introduce the laws before the May 2015 general election.

“For all the warm words expended on the floor of this house and elsewhere, still, in legal terms, nothing has changed,” Labour pubs spokesman Toby Perkins told a parliamentary debate.

“It seems that no evidence is good enough for them to recognise the reality of what people are seeing in their pubs.”

The government said it agreed on the need for reforms, but that it would not commit to new laws until it had digested the findings of its consultation, which closed later than planned in December.

“There is no attempt to kick this into the long grass. We’re trying to do this properly,” said Business Minister Vince Cable.

He said any decisions would be based on the outcome of the consultation and that he could not second-guess the government’s response to it.

While the government says the code would save tenants 100 million pounds ($164 million) in total a year, Enterprise has argued it would lead to reduced investment, resulting in increased pub closures and shutting off the industry to new entrants seeking a low cost way to enter the market.

Greene King, which has the majority of its 1,200 pubs run on a beer-tie agreement, has warned that if the code became too costly it could reduce the number of its tenanted pubs to become exempt from the regulation.

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