Pub Companies - Business and Enterprise Committee Contents


Developments since the Committee's Report


1.  We published Pub Companies, our Seventh Report of the current session[1], on 13 May 2009. Normally, we would expect to receive a Government Response before the House rose for the summer adjournment. However, there have been significant developments since we reported. It appears likely that CAMRA will launch a super-complaint to the OFT, and the ALMR[2] is working with an industry group to negotiate changes in the industry. An early Government Response would not be able to consider the outcome of these developments, and the Government might be constrained in what it said because of the reality or even the likelihood of a super-complaint.

2.  We are also aware that the industry has appeared to accept the need to change in the past, and has failed to do so. We have no intention of "letting the industry off the hook"; we believe that a premature response might do this. We have accordingly written to the Minister for Further Education, Skills, Apprenticeships and Consumer Affairs proposing that the Government delays its response until after the summer adjournment. That letter is appended to this Report.

3.  We also take this opportunity to clarify one of our earlier conclusions. Paragraph 190 of the Report says:

Since the OFT is unwilling to initiate an appropriate investigation, we recommend that the Secretary of State uses powers set out in section 159 of the Enterprise Act 2002 to refer supply ties in the public house industry to the Competition Commission for a market investigation. ...

We stand by the spirit of that conclusion, but it simplifies the legal position and unfortunately cites the wrong section of the Act. It would have been better expressed as:

We recommend that the OFT be invited to make a reference to the Competition Commission to investigate the adverse impact of supply ties in the public house industry. If the OFT is unwilling to initiate such an investigation, we recommend that the Secretary of State uses the powers set out in section 132 of the Enterprise Act 2002 to refer supply ties in the public house industry to the Competition Commission for a market investigation...

4.  We recognise that it may take some months for the industry to reach consensus on proposals for change or for any super-complaint to be considered, and there have been suggestions that we should request a six month delay. We do not think it is appropriate at this stage to set such a timetable. We are keeping developments in the industry under review, and will consider the matter again in October.



1   HC 26-I Back

2   Association of Licensed Multiple Retailers Back


 
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Prepared 2 July 2009