Pubs: looking for common ground and sense

Scarcely a day seems to go by without some major story about the pub industry hitting the headlines. In the last two or three weeks alone we’ve had the government’s latest approach to dealing with binge drinking, new figures on the still devastating rate of pub closures and, last but not least, the reopening of the Office of Fair Trading’s inquiry into the tenanted pub sector. All three of these subjects have, alas, been common themes for some time and are, to some extent, inextricably linked. The government’s remorseless attack on pubs over the issue of binge drinking while doing little or nothing to target the scandalously cheap booze sold by supermarkets is a significant factor in the pub closure rate. Similarly, the price the big pub companies charge their tenants for their beer supplies has been cited by campaigners as a key factor in many failures. This is a thorny subject, with entrenched views at either extreme of the pubco/tenant divide, but there can be little doubt that an inability to compete with nearby managed pubs has been a factor in some of the pub closures suffered over the devastating past two or three years. The sad fact is that none of these three big themes reflects positively on the industry. Whatever your views on the root causes of binge drinking, the public’s perception is certainly not helped by the reliance placed by many high street establishments on irresponsible promotions. And surely it is not beyond the wit of the different strands of the industry to find a position on the tenanted pub debate that would satisfy the authorities and avoid a protracted competition inquiry with unforeseen and damaging consequences. While government intervention on the beer tie is the last thing we need, I reckon a bit more legislation might just be what is required to stem binge drinking. I recently listened to Steve Thomas, the Luminar chief executive, make an impassioned and well-reasoned plea for the imposition of minimum pricing on alcohol. At a stroke, it would resolve the anomaly of loss-leader supermarket pricing and go a long way to dealing with the issue of irresponsible discounting in high street pubs and clubs. As long as the government didn’t decide to snaffle some of the implied higher price in some sort of anti-alcohol levy, it would also have the effect of helping operators’ margins and allow them to compete on a more level playing field with the supermarkets. A more sympathetic government attitude to the industry would also help those closure numbers. The reduction from 52 closures a week to 39 reported by the British Beer and Pub Association last week is good news, for sure, but it is still nothing to get excited about. The closure of 39 pubs a week is nothing short of a disaster, not only to staff and communities up and down the country but also to the Treasury, which as a result will lose £250m of tax revenues during the coming year. Even if we cannot rely on a sympathetic ear from Messrs Brown and Darling, surely the prospect of a widening hole in the already dangerously depleted public purse should be enough to cause an outbreak of common sense? Or am I being too naïve? Alas, I fear so. Dominic Walsh is leisure industries correspondent for The Times newspaper