Report
1. On 13 May 2009, we published our Report on Pub
Companies,[1] which
examined the relationship between the pub companies and their
lessees. Our Report concluded that the industry had failed to
make any meaningful reform since the Trade and Industry Committee's
Report on Pub Companies in 2004.[2]
We asked the Government to delay its response to give the industry
the opportunity to respond and for us to assess its proposals
for reform. We evaluated the industry's response through a second
call for evidence and by holding a further oral evidence session
with representatives of the Royal Institution of Chartered Surveyors,
British Beer and Pub Association and the Independent Pub Confederation.
2. On 4 March, we published our follow-up Report
on pub companies.[3] On
19 March we received the Government's Response together with a
briefing note from John Healey MP, the recently appointed Pubs
Minister, on the Government's new community pubs strategy. The
Government Response and the briefing note are appended to this
Report.
3. We are extremely pleased that the Government has,
as part of its wider strategy on pubs, wholeheartedly endorsed
the recommendations contained in our Report. Indeed, we see its
effective adoption of all of our recommendations, including:
- the future of the tie;
- the use of restrictive covenants; and
- the accuracy of flow monitoring equipment,
as a vindication of our hard work on this issue over
the past two years—work which has been carried out in the
face of vociferous and, on occasion, unacceptable criticism. We
are particularly pleased that the Government has retained the
option of a reference to the Competition Commission.
4. Our most recent Report set a June 2011 deadline
for the industry[4]—a
year after the codes are due to be implemented—to prove
that it has delivered on its proposals for reform and to demonstrate
that those reforms are working effectively. That deadline has
now also been taken up by the Government. In its Response the
Government makes the following commitment:
If the Business, Innovation and Skills Committee
concludes by then that the code is not working as well as it should
we will consult on putting the code on a statutory basis with
effective enforcement.[5]
5. We are grateful to the Government for its acknowledgement
of the central role that we have played in driving forward reform
of the industry. This commitment sends to the pub industry an
unambiguous message that, should our successor Committee not be
satisfied with the industry's measures in 2011, the Government
will not hesitate to intervene.
6. We see the Government's Response to our two Reports
as a vote of confidence in the select committee system. More importantly,
we believe its Response is very likely to rebalance the relationship
between pub companies and lessees in exactly the way we believed
was necessary. We hope the industry will ensure the effectiveness
of the steps it is taking voluntarily—if not the Government
is clearly committed to act.
7. We consider this to be a significant achievement
for our Committee and we look forward to our successor committee
continuing our dogged pursuit of reform of the pub industry in
the next Parliament.
1 Business and Enterprise Committee, Seventh Report
of Session 2008-09, Pub Companies, HC 26-I Back
2
Trade and Industry Committee, Second Report of Session 2004-04,
Pub Companies, HC 128 Back
3
Business, Innovation and Skills Committee, Fifth Report of Session
2009-10, Pub Companies: follow-up, HC 138 Back
4
HC (2009-10) 138 Para 21-70 Back
5
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