Pub Companies

Chloe Smith Excerpts

Tuesday 21st January 2014 Commons Chamber

[Chloe Smith (Norwich North) (Con)]

I, too, welcome the debate. It is not the first time we have looked at the topic. I am in favour of the amendment, because I believe that the Government are taking action and that it is important to do that well, rather than rushing for reasons of political expediency. It is important to start by echoing the point that my hon. Friend the Member for Burton (Andrew Griffiths) made, which was that the previous Government did not act. They seemingly did something only two months before the 2010 general election. By contrast, this Government have taken the trouble to go through a large consultation process, which has been acknowledged to be very popular. I know that many of my constituents have responded to it. It is important that the Government offer a high-quality response.

[Mr Bailey]

The hon. Lady said that the previous Government did not act. Will she acknowledge that they did not act because the Business, Innovation and Skills Committee’s 2009 report did not recommend that legislation should be introduced?

[Chloe Smith]

I defer to the hon. Gentleman, who chairs that Committee, and leave it to him to explain its actions to the House.

I want to focus first on the proposals set out in the consultation. It is right to put in place a system to stop pub companies abusing the beer tie. It is good to look at having an adjudicator who can help tied pubs. It is also good to have independently chosen guest beers, which helps to support connected industries and manufacturing across the UK.

In the time I have been a Member of this House, like every Member present this afternoon, I have become well aware of the situation facing pubs in my constituency. I could talk about the Bull at Hellesdon, an Enterprise inn, which is a good pub at the heart of the community. In fact, that was one of the first pieces of casework I took up as a new Member of Parliament. I could also talk about the Maid’s Head in Old Catton, which is also an Enterprise inn. It hosts an enormous charity fundraiser—a walk around the ring road in Norwich. The only other hon. Member who might have done that is my hon. Friend the Member for Norwich South (Simon Wright). It is that kind of activity that puts pubs at the heart of the community, and rightly so.

I also take my cue from my hon. Friend the Member for North West Norfolk (Mr Bellingham), who noted the role of the Campaign for Real Ale in supporting and campaigning for pubs. CAMRA runs the large Norwich beer festival, which in turn makes large charitable donations, most recently to the Norfolk and Norwich Association for the Blind. The Norwich Evening News is also running its strong Love Your Local campaign. By focusing on a pub a week, it does something very practical to help what can be quite a beleaguered trade.

I think we all acknowledge that pubs are facing tough times because many of their customers are facing tough times. There is a far broader debate to be had in that respect. We might look at many long and short-term economic factors, for example, but we would also do well to recognise the other things that our constituents talk to us about, such as the introduction of the smoking ban, which is commonly thought to have changed the pub trade quite a lot, and competition from supermarkets, which I will talk about later. I have always believed that good pubs can do good trade, regardless of some of those external conditions. I also want to reiterate the point that pubs are at the heart of the community.

[Sir Greg Knight (East Yorkshire) (Con)]

My hon. Friend is making some good points. Does she agree that pubs can also help themselves to improve trade by broadening the services they offer, for example by offering food and, importantly, free internet for customers?

[Chloe Smith]

My right hon. Friend is absolutely correct. That point will resonate up and down the land in urban, suburban and rural pubs and communities alike.

[Neil Carmichael (Stroud) (Con)]

I am grateful to my hon. Friend for giving me an opportunity to point out that the Red Lion in Arlingham would have been closed by a pubco but is still open and now owned by the community. That is a good example of communities taking charge of their destiny and that of their pubs.

[Chloe Smith]

I am grateful to my hon. Friend for pointing that out. I recently made the acquaintance of another landlord in his constituency who not only runs a good pub, but thinks that my hon. Friend is doing a good job as his local MP, which I think is very important.

The value that pubs can give to their communities has been quantified in various places. I want to mention a few figures which have a bearing on the debate. The industry is said to sustain 900,000 jobs nationally and each pub contributes £100,000 a year to its local economy. Crucially, about 30% of the industry is owned by the pub companies, and it is that segment that we are talking about. I support action to make that segment of the market fairer.

[Simon Danczuk]

The hon. Lady is making an important speech, but my point is about urgency. Twelve months ago, I raised concerns about the Hunters Rest in my constituency. Mary Spence, the landlady, said that because of the tie she was paying £500 a week over the odds, which equates to £26,000 a year. She threw in the towel in November. Does the hon. Lady agree that this shows the importance of the Government taking urgent action?

[Chloe Smith]

I have already said that I agree with the Government taking the action that they are correctly taking. The hon. Gentleman gives a solid example of one of the very human effects that we are talking about.

I want to note a couple of other ways in which the pub trade is being supported, including scrapping the beer duty escalator and a set of community rights. The community right to bid gives communities a fairer chance to bid to take over pubs, but there is an issue connected to this that I recently came across in my constituency. Residents were shocked to discover, at the very latest hour, that the Beehive in Sprowston had changed hands from regional brewery and pub company Greene King to the East of England Co-operative Society’s retail arm. I am the kind of MP who runs surgeries in pubs—I run a series called Politics in the Pub—and I am sad to report that I had never made it to the Beehive when this news broke. Now I may never have the chance to have a pint and some politics in the Beehive—unless I prefer a pint of milk, which is not necessarily the sort of thing I am thinking of.

On 6 January, the Co-op confirmed to the Norwich Evening News that it had exchanged contracts on the Beehive and would announce plans for a new community food store in the near future. Local residents then quickly organised and held public meetings, and local councillors and I met residents to go through the options for using the community right to bid. In this case, however, it was too late because information about the sale emerged at a very late stage. I have asked the Co-op to provide information about its plans so that it can engage with the community at an early stage. Understandably, the community is concerned not only about the closure and loss of a pub but the potential effect of a supermarket on other local businesses, as well as any intrusive aspects of the new premises that might arise from parking, lighting or similar things.

I know from experience that the Co-op’s retail arm is extremely keen to work with local communities, and I urge it to do so in this case so that the necessary issues can be properly addressed, despite the fact that planning permission is not required for a change of use from A4—which, as Members will know, is for pubs—to A1 for supermarkets. That feature of the planning system involves a very easy switch, which sometimes means that communities are not consulted on the concerns that can accrue when a pub closes.

I urge the Minister to look at this set of issues as it connects to pub companies. This is not only about the relationship between a tenant and their proprietor but the relationship of a pub to its community and the relationships that ought to be examined in the planning system—in other words, what citizens ought to be able to expect in a well-planned local area. These issues come down to wanting to keep the economy moving. I do not say that there should be stasis throughout the whole planning system, but there should be sufficient safeguards and community involvement in planning.

I support the Government’s amendment, because action has been taken to help pubs not only on the issues addressed in the consultation on an adjudicator and more, but in the field of community rights. That is very important, but, on behalf of my constituents, I am looking for the final element of fairness to enter into the debate.

--- Later in debate ---

[Susan Elan Jones (Clwyd South) (Lab)]

It is a great pleasure to follow the hon. Member for Leeds North West (Greg Mulholland), whom I know has a long track record of campaigning on this issue.

I am sorry that the playwright Samuel Beckett is no longer with us, because there is more than a shade of an existential play to this one: in act one, we all eventually come to some sort of conclusion, but in act two, it all replays, only in this case there are more than two acts and nothing changes, and on and on we seem to have gone.

[Chloe Smith]

The hon. Lady should come to the Sewell Barn theatre in Norwich. It is currently playing much better works than those.

[Susan Elan Jones]

I fear I might also have to go to a Welsh pub to hear my hon. Friend the Member for Huddersfield (Mr Sheerman) teach us folk singing, but I would be delighted to come to the hon. Lady’s constituency as well.

We were last here debating this matter on 9 January last year, when many of us genuinely felt reassured by the Government’s promises to introduce a statutory code and independent adjudicator, which we all concluded were needed, and I am extremely heartened that today, having doggedly pursued this issue, my hon. Friend the shadow Minister has offered the possibility of a proper cross-party agreement in order to get the Bill on the statute book. The Secretary of State said earlier that it all depended on the legislative timetable, but we know the paucity of business on that timetable. It would be easy for the Bill to pass, and I hope it does.

It was clear that an industry regulator was needed when we debated this last year and that the Government had to take action, and so they still do. We are not waiting for Godot; we are waiting for Government. One year on, and a good deal longer since the House first spoke out, many of us are disappointed that no progress or change has been made. Of course, any regulator must be created carefully, but the Government’s sluggish action is nothing short of a tragedy in many communities. As Members will know, the Government’s response to their own consultation on pub company reform is now four months overdue.

Society changes fast, and it is more than 20 years since the former Prime Minister John Major evoked those oh so quintessentially British images that not even UKIP councillors could complain about: of cricket, warm beer, and spinsters cycling—preferably having kept to soft drinks before doing so. The pub has been in decline for many different reasons, not least the revolting practice of what I believe is called pre-loading, which was mentioned earlier, but it is not about which Government did what. Figures from organisations such as the Campaign for Real Ale demonstrate the scale and pace of the decline, in a situation where we could effect positive change. With 26 pubs closing every week, a few hundred must have closed in the four months in which we have been waiting for the consultation on pub company reform. That is deeply concerning.

I am concerned about why the Government have failed to act. As Members will know, if a Bill is to be introduced before the general election, the Government must put it in this Queen’s Speech. With every month of stalling, it becomes less and less likely that a Bill will be passed this Parliament. We are losing hundreds of pubs a year, which adds up to hundreds of businesses and job losses. With hard-working families already struggling to makes ends meet, that will only add to the melting pot being created within our local communities. By the Government’s own admission this time last year, our local pubs are struggling. We know that. The Secretary of State for Business, Innovation and Skills was correct when he said that these small businesses were under a great deal of pressure.

In my own constituency, I am delighted to have seen creditable examples of communities coming together to fight for change, but often that has happened in opposition to the tied system, not because of it. I have been hugely impressed by a group from the village of Minera. Faced with a pub that had closed, local people came together, raised the money and reopened a much-loved pub that is now a welcoming hub within that beautiful mountainous community. Tyn y Capel pub is an excellent example of a truly community-owned and run pub. Local people have bought shares and are managing the enterprise, but financially, for all their success in the community, it is touch and go. It is not possible to run the pub full time; still less is it possible to have full-time paid staff—much of the time, it is staffed by volunteers, with only a temporary residue of paid staff.

We need more Tyn y Capels, but we need an environment in which pubs can survive. Thousands of pubs have closed in the last four years, and hundreds more are being sold every year, and with each closure, a family, an individual or a community lose their business, livelihood or a vital connection to their community.