Licensees facing bankruptcy because of high rents and rising beer prices

Related tags Minimum wage Business License Tony payne

Hundreds of licensees are facing debt and bankruptcy because of increased red-tape, high rents and rising beer prices.And many licensees are too...

Hundreds of licensees are facing debt and bankruptcy because of increased red-tape, high rents and rising beer prices.

And many licensees are too proud to ask for help, according to Tony Payne (Pictured), chief executive of the Federation of Licensed Victuallers Associations (FLVA).

The FLVA has sent a letter to the government warning that the effects of excess bureaucracy, foot-and-mouth the drop in tourism and many other factors have taken their toll on the pub trade and may lead to smaller outlets folding unless they are offered some financial help. His comments follow the rise last week of the minimum wage - the latest in a long line of changes in employment law to hit the trade.

Mr Payne is advising any licensee who fears his business may be in diffuculty to ask for help now before it is too late. He said: "A lot of people are struggling. I have just made a submission to the government on the minimum wage explaining that a lot of licensees don't even get the minimum wage themselves.

"There are a number of people having to leave the pub trade because of financial problems caused by a fall in beer sales and other difficulties.

"My advice is to ask for help straight away rather than let the situation get any worse. And if you think your rent is too high then contact your licensed victuallers association or your employers as in some cases it can be lowered."

Meanwhile, Business Debtline, which runs a free help-line and advice service for struggling businesses, said it is dealing with more calls from licensees than ever before.Manager David Hull said this was because of a number of factors including the fact that pub companies are now keener to take licensees to court for late or non-payment. But he said in other cases it could be down to the financial naivety of the licensee, especially those who are new to the industry.

Business Debtline set up its helpline in conjunction with the Department of Trade and Industry , the Small Business Service and major banks. Businesses can receive a free self-help booklet which should help them prioritise payments and run their business in the most cost-efficient way possible. For more information, licensees should call 0800 197 6026.