Tuesday, July 05, 2011

Thank you @john lewis and my apologies; I completely erased this from memory in my state of eternal oppressed pointlessness and eternal indentured servitude so thanks to you for pointing it out. It was 9 March 2011:

Private Members' Bill (under the Ten Minute Rule, SO No 23); sponsored by Martin Horwood.

Coincidentally, I met Martin Horwood only last Thursday at the Employee Ownership Association's Summer Dinner in the House of Commons where I sat between two women who work for... John Lewis.

The second reading of the bill has been put back to November 2011. Unfortunately Private Members' Bills rarely pass into legislation. In this case though there's an interesting bit of timing going on.

Regarding the upcoming (Thursday) Business Innovation and Skills' Select Committee hearing the pub industry's new Codes of Practice are being scrutinised in detail. One detail being looked at is whether or not the pubcos are offering their tenants a 'free of tie lease option with open market rent review' as recommended by BISC in 2009.

The pubcos argue that their tenants are happy with the tie (without direct evidence from their publicans) and cite the pattern of national pub closures as proof that the tie actually shelters tied pubs and publicans from the vagaries of the unbridled free market economic storm that ravages the pub industry even more than other retail sectors. Pubco's say statistics prove that fewer tied pubs close than do free of tie; ergo tied pubs are less likely to close than free of tie pubs are because of the pubcos presence in the market “we are innocent m'luds, we look after our tenants”. This porky pie, by the way, is a porky pie; see here:

Since 2009 all pubcos have rewritten their codes of practice supposedly to comply with BISC recommendations. A central part of the codes is that they should offer 'to provide their tied lessees with a guest beer option and the option to become free of tie accompanied by an open market rent review'. All the pubcos imply their COPs meet this recommendation and that they all offer a 'free of tie price option'. They do not.

What they 'offer' is a range of 'discounts': A tenant can choose to sign up to a big discount on their beer but that's goes with a much higher rent than the option where the beer is REALLY expensive - and the rent is too high anyway because it has not been subject to an 'open market rent review' under RICS guidelines: What the pubco 'offers' with one hand it takes back with the other.

When I order beer from S&N this week it will cost me £2000 (which I have to pay for with cash two days before delivery or else they won't deliver). If I were to order EXACTLY the same quantity and brands from a local wholesaler it would be delivered without payment upfront and it would cost £1,300.

My rent is the same as the Vale in East Dulwich and they are a free of tie pub.

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