Lets extend pubs adjudicator to Scotland

A pubs adjudicator would give some protection to publicans. Picture: TSPL

After almost ten years of constant campaigning, my colleagues at the Campaign for Real Ale (Camra) raised a glass to the government when, in last month’s Queen’s Speech, the last before next year’s general election, they announced the introduction of a pubs adjudicator as part of the Small Business, Enterprise and Employment Bill.

A pubs adjudicator would give some protection to those publicans who have the misfortune to be tenants of the large, pub-owning companies – some of which have been strangling the life out of the British pub trade over the past decade to service their astronomical debts by charging sky-high rents and exorbitant beer prices.

Given the nature of most pub leases, publicans have no choice but to buy all of their beer from their landlord, and at a price of their landlord’s choosing. It’s no wonder so many pubs have closed over the past ten years.

The large, pub-owning companies have, for years, argued that self-regulation worked well for the industry, completely flying in the face of all the evidence, such as a Camra survey whereby over half of the respondents in tied tenancies with the large, pub-owning companies stated that they earned less than a national minimum wage equivalent salary of £10,000 a year.

Now the government has finally grasped the nettle and struck a blow for tied publicans. The adjudicator will be empowered to ensure that the publican-pub company relationship is subject to a requirement of fair and lawful trading. The adjudicator will also be expected to ensure that tied publicans are no worse off than free-of-tie publicans.

The draft bill was published on 25 June and, under the proposed legislation, all tied tenants will be given the power to request a rent review if they have not had one for five years. They will also, for the first time, have the right to review the information pub-owning companies have used to decide to increase rents, with this greater transparency allowing tenants to see what information their landlord has used to calculate the rent and decide whether or not an increase is fair.

There will also be additional protection for tied tenants whose landlord owns 500 or more tied pubs – if they cannot agree a tied rent with their pub company, they will have the right to a parallel, free-of-tie rent assessment to show whether they are worse off than their free-of-tie counterparts, giving them the information they need to negotiate a better, fairer deal with their pub company.

Finally, they will be able to report breaches of the code to the new, independent adjudicator who will also arbitrate on rent disputes. The adjudicator will have the power to provide redress where the code has been breached and will also be able to launch investigations into allegations of systemic breaches of the code and impose sanctions – including financial penalties – if it finds the code has been breached.

While this has, obviously, struck a blow in favour of our hard-pressed publicans trying to make a go of their pubs, there is still some way to go, with Camra, amongst others, urging the government to introduce guest beer and market-rent only options for tied publicans. With a fairly light legislative programme at Westminster as the coalition gears up for next year’s general election, this is not the end of the road, but the beginning. There is no doubt there is some serious lobbying to be done on both sides as some seek to water down the proposals and others, including Camra, want them strengthened.

However, as with most things political, there is a sting in the tail – the proposed legislation does not apply to Scotland, only England and Wales.

While a Scottish Government spokesman said that Scottish ministers were willing to consider further evidence on this issue, that sounds a lot like they are not really that bothered. What is required is a Legislative Consent Motion (formerly known as a Sewell Motion), more than 30 of which have been passed under the current Scottish Government since 2011. This means that, if the political will is there, then the legislation, when passed, can apply to Scotland as well.

Camra is calling on the minister for energy, enterprise and tourism, Fergus Ewing, under whose remit this falls, to introduce a Legislative Consent Motion when the legislation has worked its way through Westminster. This will ensure that entrepreneurial Scottish publicans can benefit from any act that is passed and get on with running successful pubs, without constantly having to count every penny and keep their rapacious landlords off of their backs.

• Colin Valentine is national chairman of Camra (Campaign for Real Ale) www.camra.org.uk