Punch makes BEC promises
Punch has confirmed that it will be backing a range of recommendations contained within the highly critical Business and Enterprise Committee report on the pubco/tenant relationships.
Among a range of promises, the tenanted operator says it will stop rentalising machine income and match insurance quotes obtained by tenants.
The company has issued a statement to the stock market this morning which states that it will be:
• Supporting the creation of an independent process for accrediting improved transparency in rent assessments, including supporting the plans of the BII to introduce a low cost arbitration plan for determining rents;
• Confirming the Company's commitment to offer lessees the opportunity to buy their pub from the Company
• Explaining how the leisure machine tie optimises machine returns and review the division of machine income and will remove the lessee's machine share from rent calculations in future rent reviews
• Confirming the company's commitment to fair insurance contracts — if lessees can better the price of insurance for comparable cover that the Company is able to procure, we will reimburse the difference.
• Confirming the company's commitment to cease imposing restrictive covenants on future sales of individual properties.
Punch said it recognises that there are a number of issues facing the pub industry at present and whilst these cannot be attributed exclusively to the pub company model, it is in the company's own and its lessees' interests to address the issues that have been raised by BEC.
The company added: "Indeed, the Association of Licensed Multiple Retailers ('ALMR') wrote to the chairman of the BEC on 10 June, noting that it was working with a number of industry stakeholders (including Punch) to address the issues raised by BESC, by negotiating changes in industry practice through a formal mediation process with the intention of introducing legally binding changes in the relationship between pub companies and their lessees.
"AMLR hopes to reach a resolution within six months."
