Alcohol code will hasten pub closures

The mandatory code of conduct for alcohol retailers - set to cost community pubs £1,100 per year — could hasten pub closure rates.

That was the message delivered to the Government by All-Party Parliamentary Beer Group chairman John Grogan during a debate on the controversial proposal in Parliament yesterday evening.

It comes as figures released by the British Beer and Pub Association show pub closure rates have increased from five to six per day.

Under Government plans, pubs and other alcohol retailers would have to abide by strict codes on retailing, with compulsory staff training and the use of smaller glasses among the measures.

Grogan said if the code was too "onerous", it could cost £1,100 a year for "a well run community pub that causes no problems to anyone".

He added that "there is a danger that..the rate of pub closures could rapidly increase".

Fellow Labour MP David Kidney urged Smith to be "cautious" when imposing the code on pubs — "to ensure that she does not put another nail in the coffin of well run and orderly public houses, which are already so financially fragile at the present time."

And former minister Keith Vaz said: "The problem is not the pubs; it is the supermarkets.

"Why are the Government letting the supermarkets off the hook? It is their provision of cheap alcohol that allows people to get tanked up before they go out on a Saturday evening.

"There is no code to control that provision, which is why we have a problem. It is the loss leaders in the supermarkets that are really causing the problem."

Smith said: "The vast majority of those who operate responsibly will not be troubled by the changes.

"We need to ensure that we have the right powers in place to tackle the irresponsible minority, but without creating difficulties for responsible premises, whether on-licence or off-licence."

But she hit out at cheap drinks deals in the on-trade, highlighting promotions such as all-you-can-drink and free drinks for women.

"Frankly, that is an invitation to binge drinking, and it is not good enough."

A consultation on the details of the mandatory code is set to be released in February or March.

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Association of Licensed Multiple Retailers chief executive Nick Bish welcomed Grogans comments.

"We welcome John Grogan's highlighting of the potential cost of the new code. Our industry is well aware of the harm that overzealous, untargeted and excessive regulation can do to business.

"As the current recession deepens the Government needs to be aware that the burden of red tape currently shouldered by our industry risks doing far more harm than any good.

"We are now entering a dangerous new phase of this downturn, as even the most innovative and successful operators' efforts to attract new custom risk being stifled due to the excessive regulation that they have to deal with on a day-to-day basis.

"Every penny spent on increased compliance costs is money which is not re-invested. That re-investment is vital to help safeguard jobs at a time when businesses are at their most vulnerable."