Government threatens regulation if pubcos fail to reform
The government has warned the pub companies that, unless there is "real reform" in the business practices to improve conditions for licensees, it will step in and impose statutory regulation.
In a report that will disappoint those licensees seeking immediate action, the Business Innovation and Skills Committee (BISC) said that "this is the last opportunity for self-regulated reform", adding that it would not step in until June next year.
Although a Competition Commission enquiry could still be on the cards, it will not be imminent, giving pub companies longer to address the commercial imbalance in the beer tie that has so angered lessees.
The report said that the industry had not made appropriate change, despite two previous reports, in 2004 and 2009.
It added that the British Beer and Pub Association code of practice had only been a "modest step in the right direction" and suggested pub companies had to "significantly build on it with their own codes".
The BISC encouraged the BII to be an independent arbiter in the policing of the code of practice, urging it to "demonstrate the necessary authority and impartiality to be effective as a policeman for the industry.
The report said: "We urge the Government to monitor the success or otherwise of industry initiatives for reform and to keep the possibility of a reference to the Competition Commission firmly on the agenda. We also urge the Office of Fair Trading to look more carefully at the issues involved as it responds to CAMRA's super-complaint for the second time."
In a statement the BBPA said it would address the issues raised head on.
It added: "Companies will apply both the letter and spirit of that code in their own individual company codes within the next few months. This will deliver greater transparency to prospective tenants and lessees, more information, training and a low cost independent rent review panel for existing tenants and lessees. These are the essential building blocks for a new and constructive relationship.
"We invite wider industry groups to positively engage with, and work in partnership on, this programme for change and improvement."
Licensees fear retribution as GMB presses for action >>
GMB to hold 16 public meetings on the beer tie >>
OFT opens surprise Camra super-complaint consultation >>
Unionised publicans snub beer-tie mediation as a ‘sham' >>
By James Stagg
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