Stop the Pubco Rip-Off!
Despite campaigning efforts to date, large pubcos continue to take far more than is fair or sustainable form pub profits, leaving many pubco tenants unable to make a living, despite having a decent turnover.
The pubco rip-off is in the form of hugely inflated ‘tied’ prices that tenants are forced to pay and also high rents, so many pubco tenants are doubly overcharged. Over the years, the large pubcos and giant breweries have twisted the traditional tied tenancy model as operated by smaller breweries, so that it is no longer a fair model at all, but rather one that in many cases leads to tenants losing their businesses and pubs closing.
We are campaigning for a fair tenanted model – where finally tenants receive a fair share of the pub’s profit. Despite some positive changes, the result of hard campaigning work, including by leading members of the Campaign for Pubs, we still don’t have the ‘fair and lawful’ dealing as promised by the Government, nor are tied tenants no-worse-off than free of tie tenants.
The Fair Deal for Your Local campaign
The Fair Deal for Your Local campaign was launched in 2013 by Campaign for Pubs Director Greg Mulholland. It is now a British Pub Confederation campaign supported by all the British Pub Confederation organisations, including the Campaign for Pubs.
The Fair Deal for Your Local campaign is seeking a GENUINE Market Rent Only option for pubco tenants, which is the simple right to pay an independently assessed market rent on a free-of-tie basis.
We STILL need a Fair Deal for Locals in England and Wales!
Huge pressure from campaigners led to the introduction of the Pubs Code (for England and Wales) and Pubs Code Adjudicator. In a remarkable victory in November 2014, MPs defeated the Government and backed Greg Mulholland’s Market Rent Only option amendment, to at last give pubco tenants the right to able to take a fair share of their pub’s profit, free of the unfair pubco ‘tie’.
However the Government then watered this down and the Pubs Code only allows for a weak version of a ‘market rent only’ option for tied tenants, which is based not on an independently assessed market rent, but only an above market figure offered by the pubco and then negotiated on. The process itself is not what Parliament intended and allows the pubcos to delay a resolution for months by making unreasonable offers and forcing unnecessary arbitration, when the original intention was that an independently assessed market rent would be put in place 90 days after a tenant requested it.
The Pubs Code also only applies to tied tenants, so we have the absurd situation where a tenant who exercise their right under the Pubs Code also immediately take themselves out of its remit and loses any statutory protection, even though they are still tenants of the same company. We have seen during the Covid-19 crisis the disgraceful way free-of-tie (supposedly ‘MRO’) tenants have been discriminated against by the large pubcos, and alas the Pubs Code Adjudicator confirmed they have no protection and are not covered by the Pubs Code.
The legislation has also created a very weak and ineffectual Pubs Code Adjudicator role, with insufficient powers and far too much emphasis on arbitration, making the role not really an Adjudicator at all but merely an arbitrator between two sides where there is an huge imbalance. We need changes so that the Adjudicator can and does fulfil the role originally intended by Parliament, to actually enforce a strong Pubs Code and uphold tenants’ rights.
What is the Fair Deal for Your Local campaigning for now?
ALL tenants of the large pubcos deserve the basic statutory right to an independent assessment of their rent, and to have the right to pay only that rent to their pub owning company. They also deserve a strong Pubs Code Adjudicator, with proper powers to adjudicate, investigate and enforce, not just to issue press releases and arbitrate privately.
So to finally get a fair tenanted model and a fair deal for locals we need:
- A genuine market rent only option, which means that from request, the tenant has the right to pay an independently assessed market rent from 90 days of requesting it.
- The Pubs Code and genuine MRO must cover all pub-owning companies with 500 or more pubs who have any tenants/lessees and apply to all their tenants/lessees (only), whether free-of-tie or tied (to check if rents are at market level and not artificially set by the pubco).
- A strengthened Pubs Code Adjudicator role with the clear remit and power to uphold a strengthened Pubs Code and ensure tenants can access their right to pay an independently assessed market rent.
A Fair Deal for Your Local for Scottish tenants
The Campaign for Pubs supports the campaign for a Pubs Code – and for a genuine Market Rent Only option for pubco tenants in Scotland. We support the Tied Pubs Bill tabled by Neil Bibby MSP and urge Members of the Scottish Parliament to get behind it. Scottish tenants also need the simple statutory right to an independent assessment of their rent and to be allowed to pay that and only that to their pub-owning company – so this is what should be introduced, rather than following the watered down and inadequate Pubs Code in England and Wales.
