Solihull pub giant Enterprise Inns has promised the government it will change the way it manages thousands of pubs in a bid to stave off a potential competition commission investigation.
But a campaign for pub landlords said the “tie” between pub-owning companies and their tenants was killing off the trade – and said the government needed to do something despite Enterprise’s plans.
Enterprise, which owns about 7,600 tenanted pubs in the UK, sent a 13-point change plan to Business Secretary Lord Mandelson this week outlining how they would change their relationship with landlords.
Lord Mandelson is expected to decide what action the government will take soon, after pubcos like Enterprise and Staffordshire rival Punch Taverns were criticised by a parliamentary committee looking into the tie.
In their letter to Lord Mandelson, Enterprise promise to offer more discounts on beer, more transparency on pricing and fairer sharing of profits from games machines, among other points.
The company said: “We have already made good progress towards the implementation of these developments. Further details will be provided to tenants and lessees and other parties as appropriate over the coming weeks.”
It said any further action by politicians in the pub industry “would not be in the best interests of either the pub industry or the general public.”
“It would cause damaging uncertainty at a critical time for investment and employment in the industry and would be a waste of taxpayers’ money,” the firm added.
The Fair Pint Campaign – set up by publicans to lobby against the tie – said it welcomed Enterprise’s move as an acknowledgement of what was wrong with the link between pubcos and landlords. But they said the moves did not go far enough – and did not mean there was no need for government action.
Steve Corbett, a tied publican and the founder of the Fair Pint Campaign, said pubs would still continue to close under the new Enterprise regime. He added: “It is clear that the Fair Pint Campaign has successfully forced pubcos to think again about the long-term viability of their models but it’s a great shame that it has taken five years and two parliamentary enquiries to get to this stage. Fair Pint will continue to press the Government for real reform to ensure that the relationship between the ‘pubcos’ and their tenants is a fair one.”
Fair Pint is supported by the Federation of Small Businesses, which said the Enterprise plans were not enough for real change. FSB trade and industry chairman Clive Davenport said: “Substantial evidence among the FSB publican membership shows that the solution to the difficulties publicans face in their relationship with their landlords are not solved by a new set of recommendations but can only be solved through significant reform of the market. Our members need fairness, transparency and a chance to run their business on equal terms.”