Last month the Government announced plans to introduce a statutory code into the sector supported by a code adjudicator, but stopped short of introducing a mandatory free-of-tie option favoured by some campaigners.
Asked about the issue in Parliament, business minister Jo Swinson said: “The Government recognises that some tenant groups and campaigners support this option, which might appear to offer a simple way of ensuring that tied tenants are no worse off than free-of-tie tenants. We looked carefully at this measure but have decided not to introduce it.
“The responses to the Government’s consultation on a statutory code and adjudicator for the pubs sector raised concerns that mandatory free-of-tie would create uncertainty for pub-owning companies and have an unpredictable impact on the wider pubs sector which could even undermine the tied model.
"Even among the polarised views in the industry, there is strong support for the tie as a business model.
“What is important to the Government is that there are protections in place so that the tied model operates fairly. The reforms being taken forward in the Small Business, Enterprise and Employment Bill [including the statutory code proposals] will rebalance the relationship between pub-owning companies and their tied tenants, without threatening the balance of the wider industry.”