Meeting of the Parliament (Hybrid) 23 March 2021
I thank Neil Bibby for introducing the bill and for his open engagement throughout the whole process. The bill was not easy for the Economy, Energy and Fair Work Committee to consider, by any means. Listening to the evidence over the months raised many question marks. Effectively, two sides put forward evidence: on the one hand, the tenants; on the other hand, the pub companies or landlords. Frequently, those two sides presented significantly differing evidence, with one side sometimes contradicting the other. Little in the way of independent data was available, and the committee felt concerned at times that it did not have enough information to reach a conclusion—a situation that led to the committee’s initial rejection of the bill at stage 1.
We heard forceful arguments from the pub landlords that legislating for a change in relationship between the tenant and the landlord would lead to dramatic drops in investment in tenanted pubs and create uncertainty and slow recovery from the Covid-19 pandemic. Equally, forceful arguments were made that the pubcos take an unfair share of the profits of the tied tenants and that the legislation would make community pubs more sustainable, as well as increasing variety and choice at the bar for customers. It has been difficult to separate out the carefully constructed and presented arguments and get a grip of the best solution. However, we all want a prosperous and well-run pub sector that provides both choice and service to its customers while enabling the tenant to secure a fair income for the work that they commit to the business.
On balance, I accept the probability that tenants are at a disadvantage when negotiating with pub landlords. The decision for the tenant of whether to take up the MRO option is to be made entirely in the light of individual circumstances. When a good and fair relationship exists with the landlord, it seems to me unlikely that the tenant will wish to disturb it. However, when a relationship is sour or perceived as less than fair, the tenant will have the option to change that relationship if they believe that that will be of benefit.
The concerns about choice of products and the stocking of guest beers—specifically local beers—have received considerable attention. It seems fair to think that a tenant might feel that they have more flexibility to stock products that better reflect local tastes if they take the MRO option.
I was in two minds as to whether the bill was needed, but I am now content that, for a few tenants, it might provide a level of protection and the opportunity to reset a relationship that is simply not providing the expected results. I believe that it is important that we put policies in place that support pubs to best recover from the Covid-19 pandemic. If that will benefit some tenants, it is worthwhile.
Once again, I congratulate Mr Bibby on introducing the bill and I commend it to Parliament.
18:57