Pub company “cartels” have cause landlords in the West Midlands to abandon pubs in droves, a union has claimed.
Figures released by the GMB claim 374 pubs owned by Midlands pubco Punch Taverns changed hands in the last three years. Nationally, one in three Punch pubs changed hands in the same time, a “churn” the union blames on difficult rents and beer prices imposed by the firm.
Punch Taverns described the figures as “totally incorrect and highly misleading” yesterday. But the GMB stood by the figures, saying they were taken from a leaked internal document from Punch itself.
A parliamentary committee is currently looking at the link between pubcos – which includes big Midlands names like Punch and Enterprise Inns – and their tenants, to see if it breaches competition guidelines. Some pub landlords have claimed they are being forced out of business by harsh practices the pubcos put in place to service high levels of debt.
The parliamentary committee, led by Worcestershire MP Peter Luff, is expected to return a finding on Monday, although the deadline has slipped before.
Pubs are currently under an unprecedented amount of pressure from a combination of a downturn in consumer demand, the effects of the smoking ban and aggressive alcohol pricing from supermarkets.
Paul Kenny, the general secretary of GMB, said the high landlord turnover indicated by the union’s figures showed the extent of the pressure landlords were under from pubcos, adding: “A lot of tied pubs no longer have regular tenants.
“This high level of churn is not unique to Punch and will be replicated in other pubco estates. The churn shows that the number of closures in the big pubcos are the very thin end of the uneconomic wedge in this sector and that the level of business failures is high because of unrealistic rents and wholesale beer prices charged by pubcos.
“The high number of short term tenancies shows that pubcos are finding it increasingly difficult to find long term tenants. The short term tenants are not willing to invest to stay in the business.
“Rents need to come down and wholesale prices need to be cut. GMB members who are tenants are asking the union to look at what action is needed to secure these changes. GMB want to see the cartel broken up.”
Steve Corbett, a member of the Fair Pint campaign, accused pubcos of “hiding the damaging level of pub failures in their estates”. The Fair Pint campaign is working in support of landlords at tied pubs. He added: “These figures from GMB will be all too familiar to those inside the pub sector but hopefully they will come as a shock to MPs and business leaders.
“The Fair Pint campaign welcomes and supports the involvement of GMB and we’re optimistic that the Government will listen carefully and take action urgently to deal with the pubco cartel.”