FSB calls for radical reforms in the pub sector

Date: 2nd September 2009

Small pubs and bars up and down the UK are feeling the effects of high alcohol costs, a trade group has claimed.

According to the Federation of Small Businesses (FSB), charges faced by parts of the hospitality sector should be reduced in order to help the firms through the current economic downturn.

At the heart of the issue is the rates imposed by the Pub Companies (Pubcos), which own many of the businesses

Figures from the report show that one in eight "tied" pubs is paying 50 per cent more for beer than their "untied" rivals, putting them at a severe competitive disadvantage.

Accordingly, 73 per cent of the group told the FSB that they would support a removal of the tie.

A further 87 per cent said that the tie was a "problem" for the business.

Clive Davenport, trade and industry chairman at the FSB, said: "Tenanted pubs are not being given a fair deal from the Pubcos that own them.

"The FSB is calling on the government to introduce an independent ombudsman and a statutory code to ensure transparency at rent reviews. Without urgent action, we could see the pubs at the heart of our communities disappear forever."

Figures from the FSB show that 2,377 pubs have closed down over the last 12 months, with seven shutting their doors every day on current rates.