Tied pubs 'not less likely to close'
The All Party Parliamentary Save the Pub Group has published evidence that it claims disproves tied pubs are less likely to close than freehouses. The claim is based on an analysis by the group of existing figures from CGA.
The Save the Pub Group stated: "The pub companies, the BBPA, and others claim that tied pubs are less likely to close than free-of-tie pubs. This, however, has been proven to be misleading. New research compiled by the Save the Pub Group shows that between December 2008 and December 2010 the number of free-of-tie pubs rose by 575 pubs, whereas the number of tied pubs fell by 3028.
"In 2010 the total number of tied pubs fell by 2.3% (659 pubs) whereas the number of free-of-tie pubs fell by 1.3% (293 pubs).
"Tied pubs closures are disguised in the figures quoted by the BBPA because tied pubs are being reclassified as free-of-tie shortly before they close, which appears to be a deliberate attempt to falsify the situation.
"In 2010, 416 pubs moved into the free-of-tie category and it is likely that many of these closed, despite not trading as free-of-tie for any substantial period of time or in some cases potentially not at all.
"It also remains the case that the amount of pub business failures is considerably higher in the tenanted pub sector but that the pub companies do not publish these figures and have refused requests to do so.
"This so-called 'churn', with pubs closing temporarily, is very damaging to pubs long term viability and each temporary closure is the failure of a pub business, which should also be taken into account when assessing the failure rate of different types of pub."
The All Party Parliamentary Save the Pub Group argues that its evidence undermines the claims made by the pub companies and others "that the tie somehow helps pubs".
It stated: "Indeed it strongly demonstrates that tied pubs are less likely to survive and more likely to close than free houses. This fact that Punch Taverns have announced plans to sell off 2600 pubs because they are unviable under the beer tie model, which hardly suggests the tie is keeping pubs open.
"It is also notable that now there is a trend of former tied pubs becoming re-opened and rejuvenated when taken on by small companies, small breweries and enterprising individuals, running the pub on a different and fair business model."
Anti-pubco campaigner and Save the Pub Group chairman MP Greg Mulholland stated: "It is time to expose the complete myth that freehouses are closing in greater numbers than tied pubs. The reality is, as everyone in the pub trade knows, that many many more tied pubs are failing than free-of-tie ones and this applies to the many tied pubs that go through the cycle of closing, re-opening and closing again as tenants are squeezed out, but also to permanent closures and the loss of those pubs to the local community.
"The fact the big pub companies and their cheerleaders don't want people to hear is that between December 2008 and December 2010 the total number of tied pubs fell by over 3,000. Over the same period the number of free of tie pubs increased by over 500. It is unacceptable for the pub companies to claim the tie is saving pubs when the number of tied pubs is in dramatic decline compared to a much more stable free trade sector.
"It is also time to expose the fraud that is going on here, with tied pubs being reclassified shortly before closure or sale, to pretend they are freehouses in some cases when they have never even traded as such or for a very short period, with closure already planned. This is a scandal and the Select Committee and ministers need to be made aware of it.
"The facts are clear. Not only are many more tied pubs closing than freehouses, but the pubco tied model as operated by many companies is closing pubs that could survive were they free-of-tie. It is time for people in the industry to start to be honest. Without reform, many more pubs will close because of the pubco model of the tie which makes it impossible for many tenants to make a living and closes pubs that should not close.
"That reform is needed to save thousands of pubs that can and would survive under different ownership and a fair and sustainable business model. The Select Committee and Government should be clear - it is time to save the pub, not save the pubco whose debts are destroying Britain's heritage".
