Punch tells MPs beer tie probe would be a "waste of time and resources
Punch Taverns chief executive Giles Thorley has written to MPs arguing an investigation into beer tie would be "a waste of time and resources".
In an effort to persuade the government not to refer the matter to the Competition Commission, Thorley sent the 750-word letter, seen by The Publican, last week defending the model and outlining Punch's position.
"We believe an investigation into whether the tie is compatible with EU and UK competition law would be a waste of time and resources, since the existence of the tie has already been looked at and approved on multiple occasions by the European Commission and the Office of Fair Trading," the letter says.
A spokeswoman for Punch said the letter had been sent to a "limited number" of MPs in constituencies where Punch has pubs.
But the letter later adds: "We do accept and believe that the tied business model should continue to evolve to further protect the interests of our licensees, and to make the relationship more transparent."
The letter has been prompted by last month's Business and Enterprise committee (BEC) report into the pubcos, which recommended the model be investigated by the Competition Commission.
Thorley also says the company is taking the views expressed in the hard-hitting BEC report "very seriously" and "will carefully consider how to best incorporate them into the work we are already doing".
The company is also offering more than £1.6m support a month in more than 1,000 of its leased pubs, Thorley says.
BEC chairman Peter Luff, who was one of the recipient's of the letter, told The Publican he was "encouraged" by Punch's response as it "clearly addressed some of the issues".
"They are showing a willingness and I would congratulate them on that," he said.
He also said it was "great" that the Campaign for Real Ale had lodged a "super complaint" with the Office of Fair Trading (OFT) as he was not worried about the method, but as long as the right result was achieved.
Collectively the committee had said it had not referred the tie to the OFT because it had failed to address the issue on previous occassions, while Luff suggested it had had a "blind spot" on the issue.
