Public Meeting On 31st Jan On 42% Rent Increase For Derbyshire Village Tied Pub As Parliament Debates New Law On 21st Jan To Curb Pub Rent Abuse
Option 3 the “freedom option” offers tied tenants like Claire Muldoon the ability to buy products from the open market and pay a fair market rent for the building says GMB.
GMB, the union for tied pub tenants, will be attending and speaking at a public meeting on 31st January in Derbyshire on attempts by pub property company Enterprise to increase by 42% the rent for Claire Muldoon a tied tenant in the Patternmakers Arms, Duffield in Derbyshire.
The Patternmakers is one of 25,000 pubs owned by big property companies like Enterprise which are piled up with billions of pounds worth of debts. They are overcharging publicans for drinks – wet rent - as well trying to drive up rents – dry rents- in order to pay the interest charges.
Tomorrow (21st January 2014) Parliament debates the long running Government’s consultation on establishing a statutory code of practice to govern the relationship between pub companies and their tenants.
In April 2013 Department for Business, Innovations and Skills published a draft statutory code for tied pubs for consultation which closed in June. There was an overwhelming and unprecedented response from tenants and the public supporting statutory regulation for a free market for products and fair rents.
The details of the public meeting are as follows:
At 2pm on Friday 31st January 2014
The speakers are David Mountford GMB branch secretary for tied pub tenants and Mrs Pauline Latham OBE MP. A representative from Enterprise Inns has been invited.
Claire Muldoon, tied tenants of the Pattenmakers Arms, said “The public are invited to this important meeting as their support and input is essential to our cause.
The purpose of the meeting is to discuss the future of the Pattenmakers Arms in Crown Street, Duffield. As many people are aware Enterprise Inns is asking for a 42% increase in rent, putting the future of the pub in severe jeopardy. A representative from Enterprise Inns has been invited and we hope they will attend to answer some of our questions.
The Pattenmakers Arms has become a very important part of our community to patrons young and old. It has won awards and raised thousands of pounds for charities. Losing the Pattenmakers would be sad for both the local and wider community. A well attended meeting is vital to help us save this fantastic amenity.”
Dave Mountford, GMB branch secretary, added “GMB is in favour of Option 3 the “freedom option” in the statutory code. This offers tied tenants like Claire Muldoon the ability to buy products from the open market and pay a fair market rent for the building. See notes to editors for wording.
Interest payments on the huge pubco debts have to be paid each week before the tenant pours a pint and regardless of whether s/he can make ends meet or not. That is why Enterprise is seeking a 42% increase in rents.
To pay these sky high rents a pint of lager is on average 80p per pint higher and ale is 65p per pint higher than justified by inflation and like for like changes in taxes since 1987. This is pricing pubs out of the market and they have closed in droves.
The common view that shareholders in the pubcos own a pub business is wrong. In fact the shareholders don’t own a pub business; they own a holding company which invests in and manages incomes from pubs- these are called pub securitizations.
These securitizations are the infernal machine that is closing pubs across the country. It is the same infernal machine that drove Southern Cross care homes to the wall.
GMB and others have campaigned for many years for Parliament to legislate to free pubs from this infernal machine before it destroys them all.
This statutory code is likely to be our one chance to save local pubs. MPs must reject the Orwellian world where the pubcos brand regulation to ensure a free market as "red tape".”
Contact Claire Muldoon, Pattenmakers Arms, 4 Crown Street, Duffield. DE56 4EY tel 01332 842844 or Dave Mountford GMB branch secretary for tied pub tenants 07792 198 954 or 07794 021212 or Steve Kemp 07730 898102
Notes to editors
What option 3 says
“Option 3: Mandatory free of tie option with open market rent review
All pub owning companies with over 500 pubs would have to offer a free of tie option with open market rent review. This would apply at the next rent review point for current leases and for all new leases. Each licensee would be able to choose to be either tied or free of tie. This is in addition to the statutory code and adjudicator from option 2.
The rent in the free of tie offer would have to be based on Royal Institute of Chartered Surveyors guidance. This would ensure that there was a genuine free of tie option rather than one involving an unrealistically high free of tie rent.”