Pub Companies - Business and Enterprise Committee Contents

Supplementary evidence submitted by David Morgan

  Following the giving of evidence on 18 November, I regret that I overlooked a small but essential point in respect of transparency that was raised by Martin Willis for and on behalf of the RICS.

  Martin Willis stated that a small number of local pub comparables might give rise to a distortion in market evidence. Having had the opportunity of reflecting on this point, I find that it is exactly the same observation that is consistently made by Pubco representatives who also stand against a comprehensive register of public house rents to ensure that Lessees are kept in the dark as to other rent settlements.

  However, the exact opposite holds true for the Valuation Office of the Inland Revenue who hold and certainly utilise, a comprehensive national database of pub rents. They also have information in respect of sales/turnover which of course would be confidential in the open market as a result of the data protection laws. However, it is the very existence of this national database of pub rents that enables them to accurately set Rateable Values nationwide, often by local comparison with, say only three or four pubs and not having any knowledge of "discrepancies" between outlets.

  In the situation of arbitration, the opportunity is available to the tenant to seek disclosure of information that is within the freeholder's hands and not revealed. I have often sought the complete disclosure of pubs, say within an entire city and have been refused on the grounds of "a fishing trip". What has then resulted under an Order for Disclosure is that Enterprise Inns/Punch, etc only reveal a maximum of three to six outlets stating that the information should be sufficient for comparison purposes. I think you will appreciate the anomaly!

  I would be grateful if you could bring this information to the attention of Peter Luff, the Chairman of the BEC and Lindsey Hoyle as it seems that Martin Willis for Fleurets could be alleged to be exactly following the thinking of his major Pubco clients which in turn, might lead to allegations that the RICS is being similarly led.

December 2008

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