Last chance saloon for politicians and pubs

Self-regulation was never going to work; its effectiveness reliant upon a changing mindset from those responsible for many of the well-publicised abuses synonymous with the pubco modus operandi.​

It’s a bit like asking the wolf to convert to a diet of lentils and tofu; it was never going to happen was it?

Undoubtedly many in the wider media will conclude the issue has now been ‘sorted’, tenants have now been given a degree of protection so everything will be just fine. Sadly, nothing could be further from the truth.  

Scaremongering​

The BBPA of course continues to indulge in its favourite tactic, scaremongering. Their latest protestations suggest a fantasy world, devoid of all sound reasoning; a fact amply illustrated by Brigid Simmond’s latest article for the PMA.

It smacks of growing desperation; highlighting the extent to which the ‘Pyongyang’ hierarchy find themselves increasingly on the back foot. Flailing desperately as the questions become difficult, Simmond’s instinctive response is to crank up the smoke machine.    

She states “a self-regulatory system that costs around £100,000 per year will be replaced with a statutory adjudicator costing nearly £2 million per annum. These additional costs will be passed on to consumers in the form of higher beer prices”.

My response to that would be this:

• Do we want a cheap system that clearly doesn’t work or a more costly one that does?
• Do we want perpetuate a system that allows a select few to continue benefitting from the sweat and toil of the majority?
• Do we want to retain a system that condemns the overwhelming majority of tied tenants to struggle on less than minimum wage?
• Do we want the current rate of pub closures to continue unabated?

Accountability​

Time and time again pubcos have shown contempt toward the merest hint of reform, adhering rigidly to an uncompromising business model; one geared solely toward appropriation.  

Accountability is not part of the BBPA’s vocabulary – after all, the eagle eye of an independent adjudicator looking over their shoulder will undoubtedly cramp their style.

But we shouldn’t become overly preoccupied with adjudicators – the real issue is the tie, we know it, the BBPA know it and politicians are all too aware of it. It’s the reason we are where we are today.

Simmonds of course remains oblivious to such concerns; suggesting reformists demanding a level playing field are mere idealists.  

“The grass is always greener – this could not be more true for proponents of free-of-tie who maintain that their beer would automatically be cheaper and the beer choice wider. This is not necessarily true and if it was, it is highly likely that they will be tied to a different distributor or wholesaler, who in return for cheaper drinks will insist on loyalty to their brand, or range of drinks.” ​

It’s rare to encounter anything so utterly divorced from reality. Indeed, one could be forgiven for thinking that on this particular Brigid didn’t quite know what to say so opted to cut and paste an excerpt from ‘Top 5 Fairy Tales’​ by Hans Christian Andersen.

Why on earth would any FOT operator allow themselves to be dictated to in such terms when fledgling brewers are quite literally falling over themselves to get their products to market?

Competitive​

It would appear the BBPA’s chief executive fails to understand the dynamics of a free market, one where demand is driven by the ability to offer competitive products at competitive prices.  

She is not alone in this respect. Pubcos preoccupied with wondering where the next buck is coming from have clearly lost touch with what’s going on out in the real world.

Thanks to the explosion in micro-brewing, the range of beers now available is nothing short of staggering. Walking into any supermarket, customers are confronted with weird and wonderful beers from across the globe, at equally weird and wonderful prices.

To have any chance of survival, publicans need to replicate the choice on offer and reduce prices; the shackles of the tie ensure such aspirations will never become a reality.     

Light-touch​

Pubco priorities lie in driving up wholesale prices whilst obtaining increased discounts from brewers. And of course, by allying themselves to the big pubcos, larger brewers enjoy the ‘safe haven’ of a protected market.

A very ‘cosy arrangement’, isn’t it?

The fact that such ‘mutual back-scratching’ runs contrary to the interests of both tenant and the consumer seems beyond the comprehension of many politicians. In any other industry there would be accusations of price fixing and cartels; little wonder Simmonds calls for “light touch legislation”.

The tie is THE​ issue that has to be addressed; everything else is little more than window dressing.

Steve Kemp, of the GMB union states that for tied tenants "to pay these sky-high rents, a pint of lager is on average 80p per pint higher and ale is 65p per pint higher than justified by inflation and like-for-like changes in taxes since 1987.”

Tenants need to be empowered to stock products consumers want to drink; not products that generate the greatest profits for pubcos. Tenants need to buy at prices which enable them to make a decent living; not at prices that condemn them to a hand-to-mouth existence.

Rapacious​

Unsurprisingly Brigid Simmonds doesn’t see it that way. If she’s to be believed, “proponents of legislating for landlords to be forced to offer a mandatory free-of-tie option, fail to see that reducing the commercial buying power of the pub company would destroy the model and threaten the closure of vast numbers of pubs throughout the country with thousands of vital jobs lost”.

She conveniently fails to acknowledge the plethora of boarded up pubs littering the landscape, all of which bear testimony to a rapacious business model her organisation continues to resolutely defend. Whilst pondering this fact perhaps she could also consider why none of the advantages of the “commercial buying power of the pub company” filter down to tenants?

And this really is the issue, isn’t it? Where does all the money generated from pubs go? Continually siphoned off to service debt, fund bonuses and severance packages, finance share-option schemes, golden handshakes and inflated salaries to senior personnel, little is allocated for investment, considerably less ends up in the pocket of tied tenants.  

Whilst that situation is allowed to continue, nothing will change.

Greg Mulholland’s call for a mandatory free-of-tie option for tied tenants gives politicians one final opportunity to redeem themselves; to finally do what is right.   

It is they who now find themselves in last chance saloon.