Struggling pub landlords across the North West are set to benefit from Business Secretary Vince Cable’s plan to regulate the unfair rates they are charged for beer by suppliers.
Mr Cable will pursue legislation to curb the ‘exploitative’ practices of PubCos – the large chains that control the rent paid and beer stocked by their pubs – which will be addressed by an independent adjudicator.
The move stems from long-running attempts from Liberal Democrat MP Greg Mulholland, also chairman of the all-party save the pub group.
The campaign wants the interaction between landlords and PubCos monitored by body able to impose fines for malpractice.
Meanwhile, an e-petition demanding the removal of the beer duty ‘escalator’ – a 2 percent beer tax hike – from the next budget, has passed the 100,000 signatures threshold.
This means the issue will automatically be debated in parliament, with the petition still not set to close until February 15.
Mr Cable’s reforms are ‘not perfect’, according to Rochdale MP Simon Danczuk, but he claims they will boost the industry and halt the alarming recent trend of pub closures in the region.
He said: “Pubs are vital hubs for communities in Rochdale, but due to the Tory-led government’s inaction and broken promises on backing small landlords they are closing at an ever-increasing rate.”
Around 27 pubs close each week in the UK, with more than 200 having been converted into convenience stores in the last two years.
Crucial to the demands of campaigners is a free of tie’ option – which would allow landlords to buy beer for the best price on the open market rather than being in a locked agreement with a PubCo to pay their rates.
Mr Danczuk argues Labour pressure made the government change their approach to the issue, with the Conservatives having dismissed the idea out-of-hand only three months ago.
Labour used the first Opposition Day Debate of 2013 to call for statutory regulation of the PubCos, which the Conservatives lent their support to less than 24 hours later.
“It’s a good start and I look forward to working with them to implement the change,” he added
The move will please the Fair Pint campaign – a coalition of independent landlords.
A spokesman for Fair Pint campaign said: “Well-run British pubs are now closing in unprecedented numbers. In 2006-07 bankruptcies amongst pub landlords increased seven-fold. It is clear that the tie between landlord and PubCo is a significant and contributory factor to the demise of the local British pub.
“The tied lease agreement creates a wholly inequitable relationship between the PubCo and the tied pub landlord. It has resulted in an unfair and uncompetitive arrangement for tied pub landlords and consumers alike.”
Mr Cable said that PubCos were given one last chance to change their conduct last year, but it has now become clear that self-regulation is not having any affect.
Paul Nuttall MEP, the deputy leader of UKIP, disagrees that this change will rejuvenate the pub industry.
He said: “Legislation such as the smoking ban and increasing alcohol duty have made many local British pubs unsustainable – and the government’s proposed regulations are insufficient to save them.”
The government acknowledge that beer taxes and the smoking ban have had some impact on pubs.