The silent crisis engulfing our pubs

Pub workers are battling against a corrupt set of markets rigged against them.

Pub workers are battling against a corrupt set of markets rigged against them.

Mark Dodds sits opposite me in a café. He looks bereft as he clutches a little cappuccino. It's as if he was made to stand behind a bar, and he looks awkward in a chair. After sixteen years of running his pub in Camberwell, it finally closed down in September.

"We were making a profit until 2005," says Dodds, "We were still a viable business, we just got squeezed from the top. I fought and fought but in the end I had to let go... Honestly, it's a relief to be signing on."

A silent crisis is engulfing our pubs, and the reasons behind it are little known. It blows like a chill across the country, sweeping in and out of the boarded up pub fronts in our inner cities all the way to our remotest rural corners where punters huddle over their pints in their few remaining social centres.

Last year sixteen pubs closed every week. To put that in perspective, that's over two every day. In the last two years, over 1,000 pubs have disappeared from Britain's suburbs alone.

If this was just the result of market demand, the story would be a sad one. But the real story inspires anger. Pub workers are battling against a dark, corrupt set of markets that are rigged against them. Many are going down not because they need to, but because they're forced to.

Think of your local pub. The chances are that it will be "tied", meaning that it is most likely owned by one of the big pub companies. That people who are actually running that pub - the "Publicans" - are forced to pay rent at prices the owners decide (dry rent) and buy beer at the prices they set (wet rent).

These pub company giants are not household names. Enterprise Inns owns 6,000 pubs; Punch Taverns owns about the same. Looking from the outside, it's not easy to tell which pubs have ties and which don't. They don't have to be chains. Today over half of Britain's pubs are tied, and it's squeezing them into submission.

In one of the most shocking statistics, a recent IPPR report found that 46 per cent of publicans in tied pubs earned less than £15,000 a year, compared to only 22 per cent of non-tied publicans.

I'm not often disappointed by the FT, but when they reported on the decline of pubs in this article last week, they failed to tell this story.

"Tied pubs offer you promises of support and training and good beer prices, but they are often lies", says Jonathan Mail at the Campaign for Real Ale, "It's only after you've invested £50,000 of your own money that it doesn't turn out that way, and your beer prices suddenly jump arbitrarily high."

Mark Dodds said he had to buy £2,000 of beer a week from his pub company, when he could have bought the same amount for £1,200 from a wholesale supplier down the road. When he first took over the pub the rent was £32,000, but at the next round of negotiations his pub company wanted to more than double it. The 68 per cent hike they finally settled on, combined with another rise in the next review, bankrupted him.

"If I'd been able to keep our profits for extra investment," says Dodds, "I could have made that pub work."

Why would any pub company want to squeeze its managers in this way? Some say short-termism. As long as you gain the target level of return over the whole portfolio it doesn't matter if one or two get squeezed along the way. In some cases, it may even suit companies to force the publicans out of business so the site can be sold to a property developer. That explanation is at least consistent with the free market, but it still leaves a community without a pub.

We should remember that Britain's 50,000 pubs are more than watering holes. They are centres of our community, as Jamie Wright's sweet film aboutThe Railway in Wales shows. Interesting IPPR research has tried to put an economic tag on the social value of a pub. By factoring in things like the equivalent cost of holding community meetings elsewhere, they found that each pub offered between £20,000 and £120,000 of community value a year. That's on top of the £6 billion tax revenue and one million people they are estimate to employ.

This is not unrelated to the High Streets First campaign. At the moment, betting shops and pay day loan companies can move into former pubs without planning permission. "The Hope" in my constituency was the last pub on Rye Lane, now it's a Paddy Power. Local people feel that they are losing control of the high streets they love.

Of course pubs face other challenges. Demand is falling. Competition is increasing. Supermarkets are serving a new generation more interested in intoxication than conversation. With beer duty set to go up 10p a pint in the budget on top of VAT rises, there are worries that another wave of pubs will be pushed over edge, and free holders like the Railway are also at risk. But according to IPPR's research, it's still the tied pubs that are suffering most.

So what do we do about it? Dodds is exploring setting up a co-operative pub chain, The People's Pub Partnership, and it's worth supporting. It's also worth asking your local pub whether they are tied, and how they are being treated. With punters onside, publicans can increase the pressure on owners for a better deal.

As for policy, the Campaign for Real Ale is calling on the government to give publicans the choice to leave the tie completely at their next round of rent negotiations. Pub companies would still have a few years to make their ties attractive, and pubs wouldn't leave all at once. It wouldn't just help the publicans and the communities that treasure them, it would also be consistent with the free market.

Rowenna Davis is a journalist and author of Tangled up in Blue: Blue Labour and the Struggle for Labour's Soul, published by Ruskin Publishing at £8.99. She is also a Labour councillor.

Rowenna Davis is Labour PPC for Southampton Itchen and a councillor for Peckham

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The Randian Republican who could rein in Trump isn’t a coward – he’s much worse

Paul Ryan's refusal to condemn Trump is not caused by terror or fear; rather, it is a cynical, self-serving tactic.

Poor ol’ Paul Ryan. For a few brief hours on 27 January, a week after the inauguration of Donald Trump, the Wikipedia entry for “invertebrates” – which defines them as “animals that neither possess nor develop a vertebral column (commonly known as a backbone or spine)” – was amended to include a smiling picture of the Republican Speaker of the House of Representatives.

The online prank reflected a growing consensus among critics of Ryan: confronted by a boorish and authoritarian president plagued by multiple conflicts of interest, the House Speaker has behaved in a craven and spineless manner. Ryan, goes the conventional wisdom, is a coward.

Yet as is so often the case, the conventional wisdom is wrong. Ryan’s deafening silence over Trump’s egregious excesses has little to do with pusillanimity. It’s much worse than that. The House Speaker is not a coward; he is a shameless opportunist. His refusal to condemn Trump is not caused by terror or fear; rather, it is a cynical, self-serving tactic.

Long before Trump arrived on the scene with his wacky “birther” conspiracies, Ryan was the undisputed star of the GOP; the earnest, number-crunching wunderkind of the right. He was elected to Congress in 1998, aged 28; by 2011, he was head of the House budget committee; by 2012, he was Mitt Romney’s running mate; by 2015, he was Speaker of the House – and third in line for the presidency – at the grand old age of 45.

The Wisconsin congressman has been hailed in the conservative media as the “man with a plan”, the “intellectual leader of the Republican Party”, the “conscience” of the GOP. Yet, again and again, in recent years, he has been singularly unsuccessful in enacting his legislative agenda.

And what kind of agenda might that be? Why, an Ayn Rand-inspired agenda, of course. You know Rand, right? The hero of modern-day libertarians, self-described “radical for capitalism” and author of the dystopian novel Atlas Shrugged. As one of her acolytes wrote to her: “You have the courage to tell the masses what no politician told them: you are inferior and all the improvements in your condition which you simply take for granted you owe to the effort of men who are better than you.”

Ryan is an ideologue who insists on giving copies of Atlas Shrugged to interns in his congressional office. In 2005 he told a gathering of Rand fans, called the Atlas Society, that “the reason I got involved in public service, by and large, if I had to credit one thinker, one person, it would be Ayn Rand”.

Rolling back the evil state while balancing the budget on the backs of the feckless poor, in true Randian fashion, has always been Ryan’s primary goal. Even Newt Gingrich, who served as Republican House Speaker for five years in the 1990s, once decried Ryan’s proposals to privatise Medicare ­– the popular federal health insurance programme that covers people over the age of 65 – as “right-wing social engineering”.

These days, Ryan has a useful idiot in the White House to help him pull off the right-wing social engineering that he couldn’t pull off on his own. Trump, who doesn’t do detail or policy, is content, perhaps even keen, to outsource his domestic agenda to the policy wonk from Wisconsin.

The Speaker has made his deal with the devil: a reckless and racist demagogue, possibly in cahoots with Russia, can trample over the law, erode US democratic norms and embarrass the country, and the party, at home and abroad. And in return? Ryan gets top-rate tax cuts. To hell with the constitution.

Trump, lest we forget, ran as an insurgent against the Republican establishment during the primaries, loudly breaking with hard-right GOP orthodoxy on issues such as infrastructure spending (Trump promised more), health-care reform (Trump promised coverage for all) and Medicaid (Trump promised no cuts). It was all a charade, a con. And Ryan knew it. The Speaker may have been slow to endorse Trump but when he did so, last June, he made it clear that “on the issues that make up our agenda, we have more common ground than disagreement”.

A year later, Ryan has been vindicated: free trade deals aside, Trump is governing as a pretty conventional, hard-right conservative. Consider the first important budget proposal from the Trump administration, published on 23 May. For Ryan, it’s a Randian dream come true: $800bn slashed from Medicaid, which provides health care to low-income Americans, plus swingeing cuts to Snap (the Supplemental Nutrition Assistance Programme, aka food stamps), Chip (the Children’s Health Insurance Programme) and SSDI (disability insurance).

In Trump, Ryan and his fellow anti-government hardliners in Congress have found the perfect frontman to enact their reverse-Robin Hood economic agenda: a self-declared, rhetorical champion of white, working-class voters whose actual Ryan-esque policies – on tax cuts, health care, Wall Street regulation and the rest – bolster only the billionaire class at their expense.

Don’t be distracted by all the scandals: the president has been busy using his tiny hands to sign a wide array of bills, executive orders and judicial appointments that have warmed the cold hearts of the Republican hard right.

Impeachment, therefore, remains a liberal fantasy – despite everything we’re discovering about Russia, Michael Flynn, James Comey and the rest. Does anyone seriously expect this Republican-dominated House of Representatives to bring articles of impeachment against Trump? With Paul Ryan in charge of it? Don’t. Be. Silly.

Mehdi Hasan is a broadcaster and New Statesman contributing editor. He is based in Washington, DC

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

This article first appeared in the 25 May 2017 issue of the New Statesman, Why Islamic State targets Britain

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