COMPANIES hit out the government’s plans for an industry regulator yesterday, saying they would pile regulation on an already-suffering industry.
Business secretary Vince Cable has backed a new adjudicator, which would have the power to apply a code of conduct aimed at preventing rent hikes and constrictive beer supply agreements, claiming big landlords have abused their power at the expense of tenants. The proposals are designed to protect tenants from pub firms including Punch Taverns, Enterprise Inns and Greene King, which Cable accused of failing to “get their house in order”.
He claimed the plans would help what are known as tied pubs, which are establishments in which the tenant signs up to a joint deal that sees them pay the pub company for both rent and the supply of beer.
Pub owners have been accused of jacking up beer supply costs, and Cable said a regulator would ensure fair prices.
But pub firms said the plan would increase red tape and hinder growth. “The government is now proposing a state-backed pubs quango,” Punch Taverns said.
“A founding commitment of the coalition was to reduce regulation, but ministers now seem intent on wrapping Britain’s pubs in red tape.”
Shares in Punch closed 6.16 per cent down yesterday, while fellow pub landlord Fuller Smith and Turner dropped 4.26 per cent as investors sold off shares.