It's time to protect pubs from exploitative PubCos

Too many pub companies force their licencees to buy limited products at inflated prices. But the Tories have consistently failed to act.

I often say that one of the best things about my job is that no two days are the same. But for the first time since I became shadow minister for pubs, I’m getting a strange feeling of déjà vu. This is now the third January in a row I’ve been involved in a grassroots campaign to drag ministers to the House of Commons to talk about supporting British pubs.
 
Pubs need this support so they can get a fair deal. Most people know a favoured local which has been left derelict or transformed into a supermarket. These personal stories are reflected by the national figures. The Campaign for Real Ale (CAMRA) estimates that 26 pubs close each week and that each closure costs the local economy £80,000. Pubs are more than just businesses – they are community hubs, part of the fabric of neighbourhoods which bind us together.
                                                                                                                    
That is why it is so important that we fix the unbalanced and unfair relationship between landlords and the large pub companies (known as PubCos) from whom they rent their premises. In the House of Commons on Tuesday we will be repeating our call for a proper statutory code to govern this relationship and protect landlords.
 
Many landlords used to dream of opening a pub so they could be their own boss and run their own business. Unfortunately this dream is all too often not matched by reality. The PubCos own three quarters of Britain’s pubs and often require their licencees to buy all drinks products from them, at whatever price they determine. There also many disputes about setting of rents on pubs, and even cases where a licencee works hard to increase the profit of their pub only to see this swallowed up in increased rents the next year. The PubCos have been accused of creating perverse incentives to squeeze short-term finance out of their properties rather than promote long term stability. No wonder CAMRA estimates that three fifths of landlords tied to PubCos earn less than the minimum wage.
 
The cross-party BIS Select Committee has investigated this issue several times and has consistently recommended a strengthened statutory code to rebalance this relationship. Such a step is also supported by trade unions and small business groups. However, the Tory-led government has consistently failed to act.
 
A new statutory code would not be a silver bullet addressing all of the challenges that publicans face, but it would certainly make a positive difference.
 
In January 2012, the House voted unanimously to introduce such a code, but the government did nothing. So in January 2013, I called an Opposition Day Debate to highlight this inaction.  Just 24 hours ahead of the debate the government announced a dramatic U-turn and promised finally to introduce the code.  But a year later, despite a lengthy consultation, nothing has changed in legal terms.
 
So next Tuesday we will be debating the issue once again.
 
I will make a genuine offer to work collaboratively to get a code on the statute book to support local publicans.  But any new code must meet three key tests:
 
1. The Beer Tie, whereby landlords can only buy products from their PubCo, works for some licencees. However, for many others it means they can only buy limited products at inflated prices. We want every landlord to have the choice of whether to go free-of-tie. This would allow licencees to operate in a re-constructed market which would actually be more competitive.
 
2. When a new licencee takes over a pub, or when an existing rent contract expires and is renegotiated, there should be a fully transparent and independent rent review completed by a qualified surveyor.
 
3. There must be a truly independent body to monitor the regulations and adjudicate in disputes between licencees and pubcos.
 
Many Lib Dems privately claim that they are persuaded of the need for these measures, but have difficulty persuading the Tory side of the coalition. I hope we are able to gain enough support from right across the House to ensure that next Tuesday marks the start of a brighter future for this great British industry.
 
The Campaign for Real Ale estimates that 26 pubs close each week. Photograph: Getty Images.

Toby Perkins is Labour MP for Chesterfield and shadow minister for small business

Getty
Show Hide image

Labour's establishment suspects a Momentum conspiracy - they're right

Bernie Sanders-style organisers are determined to rewire the party's machine.  

If you wanted to understand the basic dynamics of this year’s Labour leadership contest, Brighton and Hove District Labour Party is a good microcosm. On Saturday 9 July, a day before Angela Eagle was to announce her leadership bid, hundreds of members flooded into its AGM. Despite the room having a capacity of over 250, the meeting had to be held in three batches, with members forming an orderly queue. The result of the massive turnout was clear in political terms – pro-Corbyn candidates won every position on the local executive committee. 

Many in the room hailed the turnout and the result. But others claimed that some in the crowd had engaged in abuse and harassment.The national party decided that, rather than first investigate individuals, it would suspend Brighton and Hove. Add this to the national ban on local meetings and events during the leadership election, and it is easy to see why Labour seems to have an uneasy relationship with mass politics. To put it a less neutral way, the party machine is in a state of open warfare against Corbyn and his supporters.

Brighton and Hove illustrates how local activists have continued to organise – in an even more innovative and effective way than before. On Thursday 21 July, the week following the CLP’s suspension, the local Momentum group organised a mass meeting. More than 200 people showed up, with the mood defiant and pumped up.  Rather than listen to speeches, the room then became a road test for a new "campaign meetup", a more modestly titled version of the "barnstorms" used by the Bernie Sanders campaign. Activists broke up into small groups to discuss the strategy of the campaign and then even smaller groups to organise action on a very local level. By the end of the night, 20 phonebanking sessions had been planned at a branch level over the following week. 

In the past, organising inside the Labour Party was seen as a slightly cloak and dagger affair. When the Labour Party bureaucracy expelled leftwing activists in past decades, many on went further underground, organising in semi-secrecy. Now, Momentum is doing the exact opposite. 

The emphasis of the Corbyn campaign is on making its strategy, volunteer hubs and events listings as open and accessible as possible. Interactive maps will allow local activists to advertise hundreds of events, and then contact people in their area. When they gather to phonebank in they will be using a custom-built web app which will enable tens of thousands of callers to ring hundreds of thousands of numbers, from wherever they are.

As Momentum has learned to its cost, there is a trade-off between a campaign’s openness and its ability to stage manage events. But in the new politics of the Labour party, in which both the numbers of interested people and the capacity to connect with them directly are increasing exponentially, there is simply no contest. In order to win the next general election, Labour will have to master these tactics on a much bigger scale. The leadership election is the road test. 

Even many moderates seem to accept that the days of simply triangulating towards the centre and getting cozy with the Murdoch press are over. Labour needs to reach people and communities directly with an ambitious digital strategy and an army of self-organising activists. It is this kind of mass politics that delivered a "no" vote in Greece’s referendum on the terms of the Eurozone bailout last summer – defying pretty much the whole of the media, business and political establishment. 

The problem for Corbyn's challenger, Owen Smith, is that many of his backers have an open problem with this type of mass politics. Rather than investigate allegations of abuse, they have supported the suspension of CLPs. Rather than seeing the heightened emotions that come with mass mobilisations as side-effects which needs to be controlled, they have sought to joins unconnected acts of harassment, in order to smear Jeremy Corbyn. The MP Ben Bradshaw has even seemed to accuse Momentum of organising a conspiracy to physically attack Labour MPs.

The real conspiracy is much bigger than that. Hundreds of thousands of people are arriving, enthusiastic and determined, into the Labour party. These people, and their ability to convince the communities of which they are a part, threaten Britain’s political equilibrium, both the Conservatives and the Labour establishment. When the greatest hope for Labour becomes your greatest nightmare, you have good call to feel alarmed.