Growing number of MPs support law change aimed at halting pub closures

A cross-party amendment to the Small Business Bill could potentially allow licensees tied to large pub companies the freedom to negotiate rent-only deals.

But community pubs minister, Keighley MP Kris Hopkins has warned that the amendment, tabled by Leeds North West Liberal Democrat MP Greg Mulholland, could have "unpredictable" consequences.

The Bill already includes plans for a Pubs Code and an Adjudicator to support tenants, but a growing number of MPs want to include a market rent-only option to stop large companies, those with 500 pubs or more, forcing up beer prices to unacceptable levels, which they claim can be 70 per cent higher than independent suppliers.

Despite apparent wide-spread support for the amendment, Mr Hopkins said it could put the pub industry, which contributes £21 billion to the economy every year, at risk.

"Such a move would have an unpredictable impact on the pubs sector, and risk delivering a damaging blow to these important employers both here in the Bradford district and right across the country," he said.

"Instead, this Government’s reforms through the statutory Code of Practice will rebalance the relationship between pub-owning companies and their tenants, without threatening the balance of the wider industry."

Other Bradford MPs voiced their support for the new legislation, including Mr Hopkins' fellow Conservative MP for Shipley Philip Davies, who was one of the original signatories of the amendment.

"I have spoken to many pub landlords who rent from Pubcos and the common theme is that they are tied into deals which make them far less competitive than free pubs," he said.

"This amendment would stop the worst abuses and allow landlords to compete on a much more level playing field."

David Ward, Liberal Democrat MP for Bradford East, said he would be voting for the new clause to give tenants a "fair deal" and help keep pubs open.

"The Government's plans for pub company reform don't address the fundamental issue of excessive beer prices and rents charged by the large pub companies," he said.

"This option will stop the abuse of the beer tie and will lead to companies offering fair tied agreements, with genuinely lower rents for higher beer prices."

Gerry Sutcliffe, Labour MP for Bradford South, said he would be voting for change as the Government's proposals did not go far enough to help licensees.

“Labour’s position is to give licensees the option of going free of tie – so that they can buy their beers on the open market – whenever they negotiate a new contract.

"This is the best way to ensure that large pub companies offer fair terms to their licensees, and to finally address the scandal of so many valued community pubs shutting."