Government 'not ruling out' Competition Commission probe

The government says it has "not ruled out" referring the industry to the Competition Commission, if pubcos fail to comply with its recommendations.

The official government response to the Business Innovation and Skills report has been published today and echo all of pubs minster John Healey's plans for the trade.

This includes forcing pubcos to offer a free-of-tie option for tenants and lessees - and the option of a guest beer, outside of the tie.

"The government very much welcomes the report and wishes to pass on its gratitude to the committee for all their hard work and diligence over the past few years in arriving at such a valuable report," the government said.

It also said it would be encouraging pub trade groups to "work together" to reach a point "where further government intervention is unnecessary".

But it added: "At this stage the government has not ruled out a reference to the Competition Commission."

The government's response referred to the Office of Fair Trading's beer tie investigation, following CAMRA's super-complaint.

But it reiterated the OFT inquiry will look at "whether effective competition is delivering choice and value for consumers".

The BIS committee said the relationship between pubcos and their licensees is "very likely" to be rebalanced, following the government's formal response to its lengthy inquiry.

The committee said it saw as a "vindication" of its hard work over the past two years, adding it was "work which has been carried out in the face of vociferous, and on occasion, unacceptable criticism".

It added: "We are grateful to the government for its acknowledgement of the central role that we have played in driving forward reform of the industry.

"This commitment sends to the pub industry an unambiguous message that, should our successor committee not be satisfied with the industry's measures in 2011, the government will not hesitate to intervene."