A new statutory code will give pub landlords running tied pubs new rights to help them get a fair deal from pub companies. The rules will be enforced by an independent adjudicator with the power to punish pub companies that break them. Tied tenants usually have to pay a higher price for drinks from the company they rent from. This should be balanced out by reduced rents or other benefits – but this has not always been the case, putting some tied pubs at a disadvantage.
The new rules will address that, meaning that:
Landlords will be able to request a rent review from pub companies if it has been five years or more since the last one.
Landlords will be given the right to review the information used by pub companies to justify any rent increase.
Landlords tied to pub companies with 500 or more tied pubs will be able to request an additional rent assessment to show if they are worse off than pubs with no tie.
Pubs will have the right to decide if they are tied for gaming machines as well.
Damian is currently working to draw local communities’ attention to their ability to nominate pubs in their areas as “assets of community value”. This means that, should a pub come to be put up for sale, a moratorium on the sale (of up to six months) may be invoked, providing the local community with a better chance to raise finance, develop a business plan and make a bid to buy the pub on the open market. Where the pub is a tenanted/leased property owned by a ‘Pubco’, the hope is that the knowledge of this potential hurdle/delay gives the Pubco some extra motivation to support the licensee in the development of the business and makes the pub at least a little less attractive a prospect for sale for conversion to residential use.
Damian will continue to press for more openness about how rents are set and for high-quality pre-entry training and independent advice for licensees.
He said: “I have argued for reforms for pubs in Parliament over the years and the reforms just announced are going to be a big help to the trade. I have always believed that the beer tie is not the biggest issue; when applied well, the tie can act as a way of sharing risk and can help people into the industry. What is needed is a transparent system throughout the industry to enable both tied and non-tied publicans to compete effectively, and I believe that these reforms will contribute to that.
“I also hope to see communities rally around Pubco-owned locals and consider nominating them as assets of community value, so that there is the opportunity to save them should they be put up for sale. Pubs are great social hubs, and provide valuable jobs and income for East Hampshire; we should do what we can to keep the great ones that we have here.”