Can politicians save Britain's pubs?

 

Thousands of publicans are struggling to make a living, with the smoking ban, high beer tax and "unfair" prices charged by pub companies being blamed. The government has promised to act, but will it do enough?

Alan Leach Alan Leach is giving up being a publican after little more than two years

For millions of people it is "the dream".

Running a pub - what could be better? Chatting to customers, being a leading figure in the community, being bought the odd drink, having fun: it certainly beats the nine-to-five, and the money's not bad, either.

That is the idealised vision of the licensed trade. For many thousands of publicans, the reality is very different.

Pubs, some of them hundreds of years old, are closing at the rate of 18 a week across the UK, according to the Campaign for Real Ale.

The smoking ban and rises in VAT and beer duty have hit profits, not to mention recent recessions and cut-price booze deals in supermarkets.

Many of those running pubs are locked into exclusivity deals, under which they are known as "tied houses". This means they can only sell beer, wine and spirits supplied by the companies owning the premises.

'Getting worse'

Often the wholesale prices are so high they squeeze any chance of making a decent living, it is argued.

A TRADE IN DECLINE?

  • 18 pubs a week closed in 2012
  • 117 million fewer pints drunk in three months to September 2012, compared with the same period in 2011
  • Tax on beer up by 42% from 2008 to 2012
  • Sources: CAMRA/British Beer & Pub Association

Alan Leach is one of the growing ranks of the disillusioned.

He has run the London Unity, in the trendy Hanover district of Brighton, for two years. Given the hilly surroundings, its residents should be thirstier than most.

But Mr Leach, who used to work as a manager for a medium-sized Brighton pub firm, has struggled since taking over his own premises.

He has attempted to diversify to encourage more custom, serving curries and Sunday roasts, but has found it hard.

His lease ends soon and he is not renewing it. The pub, which dates back to the mid-19th Century, has been put up for sale by Enterprise Inns, which owns the building's freehold.

Greg Mulholland Greg Mulholland has pushed for more regulation of pub companies

Mr Leach told the BBC News website: "It's becoming really difficult for publicans. The companies are charging too much for the beer, hitting our profit margins.

"Also, the rise in VAT and the smoking ban are putting the squeeze on us. Things are only getting worse and something has to be done about it.

"Otherwise, independent pubs like ours are going to keep closing, and communities will suffer."

The London Unity is being advertised as premises which would "suit alternative uses subject to planning", one of which could be as flats.

A Twitter campaign has been established to prevent this happening, led by Rhian Jones, a restaurateur who wants to take over the pub and keep it as a licensed premises.

She said: "It's a nice-sized pub and it's in a nice area, with an established customer base. People agree with me that it would be a pity if the London Unity closed.

"Every day I drive past signs saying pubs have closed down and there's permission to turn them into housing. It's so sad. I want to run the Unity as a good old-fashioned pub."

But Enterprise Inns denies it is pushing for the London Unity to become housing in an effort to make a quick buck.

'Scam'

A spokesman said: "As part of our ongoing business, we do from time to time identify a pub which is unable to deliver an appropriate level of sustainable income.

"After careful consideration and a review of all options, the decision has been made to offer the freehold for sale on the open market with no restrictions on future use."

Pubs have changed enormously over the past couple of decades. Most offer food. Some are far swisher. Opening hours are longer.

Queen Victoria pub in BBC's EastEnders Pubs have an established place in British life

But the biggest change came after the Conservative government of the late 1980s became concerned that large breweries owned too many pubs.

The Monopolies and Mergers Commission found they were creating a "complex monopoly", damaging the interests of publicans and customers.

The resulting "Beer Orders" stipulated that no brewery was allowed to have more than 2,000 tied houses by November 1992.

So thousands of pubs were sold, many of them bought by companies which became known as "pubcos", which, as they did not manufacture drinks themselves, were exempt from the terms of the Beer Orders.

They quickly proliferated and the largest today are Enterprise and Punch Taverns, owning more than 8,000 pubs and bars each.

Liberal Democrat MP Greg Mulholland, who chairs the All-Party Save the Pub Group, has accused pubcos of overcharging for beer and rent to help pay off their large debts.

He said: "The anti-monopolies move went wrong. The pubcos are now as big as the breweries ever were. Politicians on all sides recognise that something needs to be done. A lot of what is going on is nothing more than a scam.

"These firms are in debt and the quickest way to get rid of it is to sell off the premises. That means a load of pubs will end up as housing or supermarkets, ripping the heart out of many communities.

"It's heartbreaking. People are just trying to make a decent living and do their bit to keep places alive."

'Irresponsibly low prices'

Amid accusations that pubcos are exploiting tenants, the current government has promised to introduce a statutory code of practice to govern the relationship between them and landlords, overseen by an independent regulator.

The details of this arrangement still have to be thrashed out.

But Enterprise Inns said the tied house model was working for thousands of publicans, offering a "low cost of entry", as buying a lease was far cheaper than having to purchase the building outright.

Chief executive Ted Tuppen argues that politicians are to blame for much of the malaise, particularly the beer duty escalator, which automatically rises at 2% above the rate of inflation.

He said: "The past five years have clearly been difficult for publicans, with the smoking ban and irresponsibly low prices from supermarkets.

"In addition, the impact of the duty escalator has greatly contributed to the demise of many smaller, wet-led [beer, rather than food-oriented] pubs. During the past three years, whilst our average profit per pub has declined 12% to £67,000 per annum, the Treasury has increased its tax take by 19% to £145,000 per pub."

Action on tied houses is being promised, but it is too late for some. For others, a more fundamental rethink of taxation is just as important.

Behind the bar at the London Unity, Alan Leach is preparing to pack it all in in a few weeks' time. "It's such a pity, but I've got to make a living," he said.

 

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  • rate this
    +8

    Comment number 474.

    Less people going into pubs BUT more alchohol being consumed by the population.

    Because we get it cheap from supermarkets and then buy WAY more than we ever would have in the pub.
    Or is that just me?

  • rate this
    -1

    Comment number 473.

    Thought the Tory party were already rescuing the Pubs single handed, after all they are spending our money on their fiascoes like drunks on a Friday night. Look how they have raised the National DEBT by 58% to £1.2tn in only 33 months. So they must be high on something!

  • rate this
    +1

    Comment number 472.

    @459

    Agreed, and from my experience your attitude is the majority of smokers' towards the smoking areas. I think the social norm now is the 'work like a dog through the week - then binge on fri/sat'. Locals don't get a look in especially during the week, less business, less revenue. Its just how we have changed our habits overall and that unsurprisingly has dealt a huge blow to local pubs.

  • rate this
    +1

    Comment number 471.

    @454
    I agree with you that Politicians don't do anything useful but democracy is not their to sort things for us. Democracy is a tool to use, like a spade.
    Someone needs to pick up the spade and dig the hole it won't magically appear just because the spade is there.

  • rate this
    +3

    Comment number 470.

    We need places that are better connected with local brewers and distillers instead of getting the same products from the same multinational suppliers such as Heinekken or Carlsberg. A place that is truly connected with its community in a micro-market method.

  • rate this
    +81

    Comment number 469.

    The politicians are taxing and moralising (cigarette bans and anti drink campaigns), the pub culture out of existence. The French cherish their cultural habits, we destroy them .... thats why we are being wiped as European nation and turned into some polyglot 'world' culture. The English will disappear from history.

  • rate this
    -9

    Comment number 468.

    Well I know its London and not the country, but I would be glad if more shut down. We have eight pubs and wine bars within half a mile. Weekend evenings are just great with hoards of youths shouting, urinating and throwing up on the streets.

  • rate this
    +8

    Comment number 467.

    How many of you can honestly say you use your local pub a couple of times a week or more? If you want something to be there then you need to support it.

    It's true that the taxman, smoking ban and PubCos aren't helping but you've got to vote with your feet on this one people... use it or lose it!

  • rate this
    +2

    Comment number 466.

    The fact that we still have licensing laws at all shows how backward a nation w are. The "workers" not providing munitions phase which pre-empted the laws in the first place are long gone but still we suffer the consequences.

  • rate this
    +2

    Comment number 465.

    Its obvious the PubCos are the problem, followed closely by supermarkets and the duty escalator, what needs to happen is:

    1. Ban any company from owning more than say 20 pubs
    2. Introduce minimum pricing on alcohol and stop supermarkets selling at a discount.
    3. Freeze the duty escalator on beer

    Job done.

  • rate this
    +2

    Comment number 464.

    Pubs are under pressure from supermarkets selling ridiculously cheap alcohol and from the PubCos that are only interested in the rent

    If drinking is a problem in society then why just hit the pubs and leave cheap alcohol available from the supermarkets


    I tried getting help for my local pub from my MP (Mathew Hancock) but no doubt he was too busy drinking subsidized booze in Parliament !!

  • rate this
    0

    Comment number 463.

    What's needed is a system where sales in 'proper' pubs are not taxed and the landlord can actually make money. Proper pubs being those belonging to a brewery rather than the chains of pub companies ruining the industry with businesses destined to fail from the outset. Instead, load the 'lost' tax on supermarket/off licensed sales.

  • rate this
    -20

    Comment number 462.

    Pubs are doomed. Firstly they sell a class A drug called Alcohol which will soon be on its way to being banned like Tobacco. Secondly they all turned into restaurants twenty years ago when it became unfashionable to drive to them to drink alcohol. So I'd say they are going the way of the village post office. Irrelevant and on the scrap heap of history.

  • rate this
    +4

    Comment number 461.

    The problem is largely the fault of politicians trying to crack the binge drinking nut with a broad legal sledgehammer.

    By increasing duty on all alcohol, regardless of where it is served, all they have done is made people seek out the cheapest booze and drink at home.

    At home, there's no-one to tell you you've had enough or keep order. People drink more, pubs go out of business.

  • rate this
    +5

    Comment number 460.

    Sorry 419 I didn't mean to mark you down I intended to mark 401 down.
    Country pubs are not booze factories.

    Amending the music licence fees would help.
    The cost of live sport is too high for small pubs too

  • rate this
    +2

    Comment number 459.

    Don't think the smoking ban is to blame, I & all the smokers I know don't mind going out esp if there is a shelter. High prices don't stop the 'drinkers' in my local but it's simply no longer the social norm for many locals to pop to the pub of an evening - if this continues then pubs are doomed and there isn't a thing the Gov can do about it.

  • rate this
    -21

    Comment number 458.

    The culture is too supportive of pubs and the stupid notion that they are an important part of the 'community'. Don't care at all about the decline of this local drug dealer: many heavily infiltrated by local organised crime, noisy, and full of annoying jakey drinkers and mindless violent idiots drowning their moronic woes.

    Go on 'have another drink' and let them wither and die.

  • rate this
    +11

    Comment number 457.

    Smoking ban was a bigger reason for pubs decline than many realise. Certainly in my local we were told that for every smoker who will no longer come in there will be non smokers who will start returning. That never materialised. Some just stopped coming and got used to drinks at home (cheaper too). The landlord tries so hard bless him but its all an uphill battle. Hes cut his opening hours too

  • rate this
    +17

    Comment number 456.

    The Victorians had it right with designated 'Smoking Rooms' - but the current dictatorial morons have replaced 'lattitude' with the arrogance of "they'll have to put up with it" and "the non-smokers will simply replace the sales". Not happening, is it morons! Still, the muslim voters will be pleased at the national eradication of such offensive alcohol vendors, and we'll be so culturally enriched!

  • rate this
    +4

    Comment number 455.

    Ten years ago I helped organise a campaign over industrial land in Kentish Town, north London. As part of it a photographer made a montage of pubs in the postcode that had shut. From memory the total number was 40. Since then more have shut. The reasons and remedies are well known: reduce taxes, restrict supermarket sales. Not hard to imagine NW5 will be pub-free in a decade's time, otherwise.

 

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