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Leeds MP wins sensational victory in House of Commons on pubco reform

November 18, 2014 5:49 PM

November 2014, FDFYL18112014The Fair Deal for Your Local campaign today won a sensational victory in the House of Commons, defeating government 284 votes to 269, a result that is all but set to give thousands of publicans across the country the market rent only option many have long called for.

Going into the Small Business Bill debate, the cross-party amendment was signed by 91 MPs, with the Fair Deal for Your Local campaign itself having 212 MPs signed up as supporters. The campaign was also backed by ten organisations including the Campaign for Real Ale, Federation for Small Businesses, Forum for Private Business, GMB and Unite.

New Clause 2 had been tabled by Greg Mulholland, Chair of the All-Party Parliamentary Save the Pub Group, Adrian Bailey, Chair of the BIS Select Committee and Brian Binley, a member of the Select Committee and President of the Save the Pub Group, with support from many pro-pub and pro-small business MPs across the House. In the run up to the vote, over 8,000 CAMRA members contacted their MPs urging them to back the clause.

Market rent only is a simple, market based solution what would allow tenants of the large pub companies the right, at rent review or renewal, to ask for an independent assessment of their rent without tie obligations, then have the option to pay this to the pub owning company - or to opt for a fair tied agreement with a lower rent being offered in exchange for higher beer prices.

Commenting after the win, Mulholland said:

"This was a victory for people power, for commonsense and for fairness and a victory a huge hard pressed publicans and their customers. I thank all MPs who had the courage to listen to their constituent licensees, CAMRA members and campaigners who have been campaigning for years to end what CAMRA call the pub scandal.

"For too long, the large undebted pubcos have exploited their tenants and taken more than is fair or sustainable from pub profits, now the House of Commons has clearly passed the select committee option of a market rent option which will stop the pubco rip-off of hugely marked up beer prices and excessive rents.

"This is great news for pubs, hardworking pubco publicans and for communities and consumers, who will see many more sustainable pub businesses and a cheaper pint of beer, free from the pubco price escalator".

"Contrary to typically misleading and increasingly desperate statements from their pubcos and their lobbyists, this does not abolish the beer tie. It simply gives tenants the right, at rent review or renewal, to request an independent assessment of their rent and opt to pay that if their pubco fails to offer

"As Coordinator of the Fair Deal for Your Local campaign I am hugely proud of all supporting organisations and want to say a huge thanks and congratulations to CAMRA, The Federation of Small Businesses, The Forum of Private Business, The GMB, The Guild of Master Victuallers, Fair Pint, Pubs Advisory Service, Justice for Licensees, Licensees Supporting Licensees, Licensees Unite the Union and the Punch Tenant Network. A big thanks also to the BIS Select Committee, their Chair Adrian Bailey and former Chair Peter Luff and all the members who did such important work looking at this issue and coming up with the simple, obvious, market based solution that will now become the law".

John Allan, FSB National Chairman said:

"This is a historic day for tied publicans who look forward to a more open and competitive marketplace. The freedom to stock a wider range of beers will provide a boost to local economies while giving consumers greater choice.

"We call on Government to support today's decision and for all parties to back publicans in their respective 2015 election manifestos."

Adrian Bailey, Chair of the Business, Innovation and Skills Select Committee also said:

"Today was a great day for pub tenants and for parliamentary democracy. The MRO is the first step to releasing pub tenants from the shackles of a relationship with the Pubcos that was unfair to them, damaging to the industry and the communities it serves. However we must not assume that everything will suddenly come good. The BIS Select Committee will continue to monitor the application of the MRO and is fully prepared to take further action if is not adhered to."

Dawn Hopkins of Licensees for Licensees, added:

"Our members are ecstatic at the news that MPs have voted for New Clause 2 in the Small Business Bill and have backed MRO. This is literally a life changing decision for so many tied licensees, a lifeline to be able to continue running their pubs and to actually make a living and keep our pub industry thriving. We cannot thank enough the MPs that voted yes, and to all those involved in the Fair Deal For Your Local Campaign who worked so hard to make this happen."

Paul Naylor of Licensees Unite said:

"Unite are proud to be part of pub history on today's momentous events in Westminster, that should see the pub sector being fairly treated and hopefully to stem the tide of closures and stabilising what was in danger of becoming a failing industry."

Paul Kenny GMB General Secretary added:

"MPs have done the right thing and GMB welcome this. Government must accept this vote and move to properly implement it to save 25,000 tied pubs.

MPs have voted for a clause that shows that the market rent only option is a simple, cheap to administer and market based solution that at certain trigger points would simply give licensees the choice as to whether to pay a fair rent only or stick with a tied agreement. This choice will force the large pub companies to ensure that their tied agreements - where tenants pay marked up prices for beer and other products and services - are competitive, fair and attractive to tenants."

Grahame Morris MP, Vice Chair of the parliamentary Save the Pub group, also said:

"This is an excellent result. Support for the clause was from across all sides of Parliament. This is an example of predatory companies exploiting landlords at the expense of the economy, the community and consumers. I'm very proud I put my name to table this clause and hope in time it will make a real positive difference for landlords and pub users throughout the UK"

Inez Ward of Justice for Licensees said:

"Yesterday's vote was a vote for pubs, it will be good for the pubs, licensees, customers and small brewers alike, it will also be good for the pubcos who can now build a sustainable business moving forward. We hope that the lesson moving forward will be that by working together for the benefit of the trade can produce some fantastic results for the trade."