Pub Companies - Business, Innovation and Skills Committee Contents

Written evidence submitted by Mark Charman

1.  Since the committees last enquiry and my submission to your previous enquiry I now only run a free of tie estate. When we have landlords they tend to be private landlords or small pubco's with realistic expectations with regard to rents and repair liabilities.

2.  With that said, I do feel that I am in a position to comment further on the current tenant pubco relationship. In my current position I am interviewing on a constant basis. This year alone I have interviewed over 100 applicants that are either current tenants or have recently been a tenant with one of the major five pub companies.

3.  In my view the situation remains largely unchanged. I still come across numerous tenants that are not only dissatisfied with their pubco but usually have a desperate story to tell. The new codes of practice seem to be treated as a bit of a joke. Forms are filled out, tenants are provided with information and boxes are ticked, but the underlying issue of a tenant not being able to make a decent living still remains. Furthermore, the aggression with which tenants are treated does not appear to have dissipated. I can give you a very recent example:

I met a very capable and experienced couple last year who turned down a position with myself in order to take a position with Punch Taverns. Punch Taverns were very keen for this particular couple to run a very well known public house with a good reputation. The couples were promised a fair deal, fair rent and were given assurances that some immediate maintenance issues would be attended to. Seven months on the couple are told they will not be getting the 21 year lease as originally promised and instead the pub is likely to be sold. Punch refused to install a boiler leaving this particular couple no choice but to install one at great expense. I should point out that they are trading the pub above expectation and their standards are incredibly high. There seems to be much of the same treatment whereby in their own words, this slightly naive couple have been used and abused and have been put through unnecessary emotional strain.

4.  I am however glad to report that smaller pub companies are at long last facing the reality of the situation and are starting to make sensible business decisions for the benefit of all in the industry. There should be a word of caution however that a number of pubco's with large estates have been unable in recent years to let large proportions of their estates and have instead chosen to operate them as managed houses. I have seen evidence recently that one companies advertised deal for managers isn't quite as described and managers are sometimes finding themselves working for very little and on occasion having to pick up a number of the pubs utility bills. There seems to be some of the tenanted mentality towards treating people creeping in to these new managed estates. I believe great care should be taken to ensure a new problem is not created out of trying to solve an old one. In my view there is an unhelpful, unwilling and dirty undertone to the running of many of the larger pubco's. My view remains that the tie is unworkable as a business relationship and regulation to remove the tie from estates with more than circa 50 pubs would be of great benefit to the industry and particularly the hard working people who run the majority of the countries pubs. However, I believe further regulation would be required to totally resolve the industries problems. Once a pub company has more than 1000 pubs they can become dominant and oppressive to those involved in them. Perhaps the committee should consider whether or not pubco's in the future should be allowed to grow beyond a certain number of pubs.

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Prepared 6 October 2011