Thursday, 14 October 2010

CAMRA vows to keep up pressure to secure reform of the beer tie

CAMRA vows to keep up pressure to secure reform of the beer tie

“Blinkered” OFT fails to tackle Pub Company abuses

CAMRA, the Campaign for Real Ale, is continuing its campaign to secure reform of the beer tie despite today’s announcement by the OFT, Office of Fair Trading, that it will take no action. This is despite considerable evidence providing reasonable grounds to suspect anti-competitive behaviour by the large pub companies.

The inaction of the OFT, whose responsibility is to ensure markets work well for consumers, is all the more remarkable given that the Commons Business Select Committee and the Government recognise that a competition problem exists and are working to find a fair solution.

Mike Benner, CAMRA Chief Executive, said:

“CAMRA’s initial reaction to the OFT’s decision is that it is based on a blinkered and selective consideration of the evidence. The OFT has squandered an opportunity to support a process of industry self regulation to improve competition and benefit consumers. Today’s OFT decision does nothing to change the fact that the Business Secretary ,Vince Cable MP, has publicly stated that the pub companies are on probation and that they will face legislative action if they fail to reform by June 2011.”

“The OFT recognises the concerns of tied pub landlords but has failed to recognise the impact of these on consumers. It is extraordinary that the OFT appears to have dismissed as irrelevant the treatment of tied pub landlords by the large pub companies. A balanced and fair relationship between tied pub landlords and the large pub companies is crucial to ensuring the pub market works well for consumers.”

“The OFT’s own analysis recognises that tied pub landlords on average pay around £20,000 more for their beer every year as a result of being tied and unable to purchase beer on the open market. CAMRA, unlike the OFT, recognises that higher costs imposed upon tied pub landlords will inevitably be passed onto consumers through higher prices, under investment and pub closures.”

Dr. Rick Muir, author of the Institute for Public Policy Research (ippr) groundbreaking 'Pubs and Places' Report said:

“ippr research shows community pubs are not just places to drink, but are also places where people meet friends and neighbours and where local clubs hold meetings and events. Community pubs are the embodiment of the “big society” principle yet many risk being squeezed to death as a result of restricted competition. The OFT has failed to stand up for individual pub landlords and ultimately it will be consumers who suffer as yet more pubs close.”