Fair Pint: "We're seeking changes that will really help pubs

In response to Adam Withrington's blogs (see right) Fair Pint released the following comments:

"Adam Withrington's comments about the Fair Pint campaign are wrong but have at least generated interest in the issues affecting publicans.

The Fair Pint campaign is the fastest-growing trade body in the pub sector. With approaching 1,000 members after just 12 months, our clear message is attracting many more every day. Fair Pint is supported by 3,000 pub members in the Federation of Small Businesses and now by the GMB union. Our concerns have been embraced by the media and we hope to reinforce our strong cross-party support in Parliament through our Lobby Day on May 20. David Cameron wished us well last week.

Founded by ordinary publicans, we rely on the freely given time of members. Contrary to Adam's claims, the group has spent very little on political support - just £3,000 each month since last autumn. Individual donations from a few members have paid for this support and also for some legal advice.

There are no backslapping industry lunches or awards ceremonies. The group is focused on the issues and the facts.

The pubcos, including the large regional brewers, operate the beer tie in an unacceptable way. In other sectors, a long-term commitment to buy from one supplier would be rewarded with high discounts. The opposite is true in the pub sector. Not content with retaining all or most of discounts of up to £250/barrel and making margins of up to 85 per cent on beer sales, pubcos have added up to 53 per cent to the price of beer since 2002. The tie has been extended to include cider, flavoured alcoholic beverages (FABs), wines and spirits with similar price hikes.

The rent review system for pubs has become heavily skewed in favour of landlords. This affects every pub tenant, tied or not. The legal meaning of rent review clauses has become obscured. The hypothetical 'competent tenant' has become one who overestimates income and underestimates costs. The lack of discount available to tied tenants is routinely ignored.

These issues have been suppressed by other trade bodies claiming to represent publicans but really beholden to brewery and pubco interests.

The British Beer & Pub Association (BBPA) still says the tie and rent levels have nothing to do with pub failures even though the GMB recently highlighted the high level of failures in pubco estates.

Fair Pint's careful arguments have succeeded in persuading Parliament to look again at the tie and the Royal Institute of Chartered Surveyors (RICS) to reconsider how its members are practising rent reviews in the pub sector.

Fair Pint simply tells the truth when it says that alcohol duty is paid by producers, not by retailers. Without guarantees that any duty concession would be passed on to publicans and their consumers, those concessions would make no difference to the cost of beer in pubs or help struggling publicans, including many Fair Pint members, in keeping their businesses going.

Adam tells us this is absurd, which shows little understanding of the trade. Alcohol duty is only paid by producers. It is up to those producers as to whether they pass on that cost to publicans and the consumer. If producers absorb concessions and still raise prices, then pubs are no better off.

On one hand, according to Adam, we are fanatics, moments later he has us influencing government policy. Fair Pint met with Treasury officials twice. We confirmed our support for duty concessions if it could be guaranteed that brewers and pubcos would pass the concessions on to pubs.

The duty increase, when it came, amounted to about 0.8p on a pint of four per cent lager. The BBPA will have been told by the Treasury, as we were told, that a duty concession was extremely unlikely. Ted Tuppen, chief executive of Enterprise Inns, astute as ever, raised his prices by six per cent well before the Budget, so clearly he wasn't expecting any concessions.

Angela Eagle and her officials probably do know more about the tie than Adam does about hedge funds.

It's unsurprising that the minister responsible for taxing the sector will know enough about it to ask questions of the BBPA's Michael Turner, assuming Adam's 'good authority' holds true.

It's equally unsurprising at a time when the economy is in tatters and budgets for hospitals and schools are at risk that this Chancellor, or any other, would refuse to hand money to brewers and property companies when not one pub would be saved as a result.

The Axe the Tax Campaign, with Mr Pinty and friends as its low point, was flawed from the start. With the two main pubcos alone needing around £700m every year - £50,000 per pub - just to service debt it was an uphill battle to persuade government that less than 1p on a pint was the real burden for pubs.

Fair Pint offers an analysis of the problems facing pubs that is balanced and truthful. We are pressing for the attention of government and seeking changes that will really help pubs.

The Fair Pint Campaign is adding a coherent voice to the rising calls for reform in the pub sector.

We have become an influential voice in the debate about our future because we are the one organisation representing pub tenants alone and which is not conflicted by other interests."