Beer waste calculations to be ‘more standardised’

By Claire Churchard contact

- Last updated on GMT

Waste not want not: call for clarity in relation to beer and cider wastage allowances in rent assessments
Waste not want not: call for clarity in relation to beer and cider wastage allowances in rent assessments
Representatives from pub-owning businesses (POBs) have agreed to come up with proposals for a more standardised approach to calculating beer waste from pubs in relation to rent assessments.

The pledge comes after a meeting of the pubs code adjudicator (PCA) and POBs’ code compliance officers (CCOs) on 26 March. 

At the meeting, the PCA raised concerns about the lack of clarity in relation to beer and cider wastage allowances in rent assessments.

It highlighted issues of compliance with how the volume of alcohol that duty has been paid on is measured and how the volume of draught beer and cider that will not be sold during the forecast period is estimated including wastage (where the figure is not included in the gross profit margin).

These issues were flagged in conjunction with the need for POBs to give tied tenants clear and detailed information on these measurements as well as providing supporting evidence for any assumptions. These requirements are set out in the Pubs Code Regulations Schedule 2​ paragraph 5(c) and (f) in conjunction with paragraph 8.

Calculations training 

The PCA also raised concerns about sediment waste and operational waste and how valuers, new tenants, business development managers and others are trained to calculate wastage.

The meeting notes said: “Evidently, POBs all deal with sediment waste in a different ways, with varied and blended approaches. The code requires POBs to give tenants a clear explanation of how wastage is calculated and the PCA stressed the need for greater transparency in current valuations.”

The notes confirmed CCOs were happy in principle to amend their rent assessments to give an explanation and show allowances made for sediment and operational waste more clearly. But they said that they would need to bring in systems changes to make it happen and would need adequate time to implement them.

The meeting concluded with the agreement that CCOs would “come up with proposals for a more standardised approach to waste calculation, provision of Schedule 2 information and examples of how this is embedded into relevant training by 19 April”.

In the same meeting, the PCA also called for pub-owning businesses “to waive confidentiality in arbitration awards”​ to make the process more transparent.

Related topics: Legislation

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