Wednesday, 19 November 2008

Lovely cuddly-wuddly pubcos in whose safe hands we trust our pubs, Pt. 2

Tandleman's comment on my previous post deserves some examination.

"I like the fair pint campaign recognising as it does the need for the tie for those tied to brewers who own up to 500 pubs, (To do otherwise would mean we would lose all our Family Brewers."

The tie was originally a good thing in that it allowed brewers to develop and have an outlet for what they made. It was never designed for giant and avaricious PubCos. It is their monopoly we must challenge."

You are mostly right in what you say, but your anti CAMRA swipe is just your prejudice showing. CAMRA has campaigned against the big Pub Companies and indeed, if I remember correctly, spoke against them in the last round of government enquiries."

CAMRA, as far as I know, supports the tie in broadly the same way as the Fair Pint Campaign which you rightly praise."

The problem is unfairness. The members of the Fair Pint campaign are angry because they rightly see being tied to unnecessarily expensive sources of supply as reducing their competitiveness. The tie system is fundamentally anti-competitive and that is the crux of the argument against it.

The problem is the tie is always anti-competitive. It is irrelevent whether the pub chain owns 10, 100, 500 or 5000 pubs. And herein lies the problem for CAMRA.

CAMRA heartily dislikes the Pubcos and would like to see their wings clipped. Unfortunately, challenging them for anti-competitive practises would draw attention to the same anti-competitive advantage heartily embraced by the "Family" Brewers (many of which are rapacious PLC pubcos in their own right.)

So, CAMRA has a conundrum – it has a big stick with which it could beat Enterprise et al but that big stick would necessarily inflict collateral damage to their beloved "Family" brewers. And that would be just not on. Even discussing it would cause a mighty big stink.

Also, I believe CAMRA's taciturnity on the subject of competition is political. Although competition and choice go hand-in-hand, CAMRA demands only the latter. As I've previously described, a far-left anti-capitialist ethos pervades CAMRA and talk of competition provokes a head-in-the-sand response. The dread word "competition" can evoke raw memories of the socially brutal Thatcher years. It needn't be so.

I suspect that Tandleman reveres the "Family Brewers" more than I do. The worst of them e.g. Greene King are rapacious pubcos like Enterprise and Punch; only we're expected by CAMRA to pussy-foot around them only because they persist in brewing real-ale (dull as ditchwater though it is.) At the other end of the scale there are some rather more endearing companies. I used to be particularly irked by Youngs, on whose territory I lived for fourteen years. Firstly their own beers were extremely inconsistent. Getting a good pint was the exception, not the rule. Secondly, entering a Youngs pub entailed being deluged with promotional dreck for Stella and Guinness. To all intents and purposes some of their pubs didn't really sell their own beer; beers from the mass-producers won the Youngs seal of approval. In many of their pubs it was even impossible to buy their rather good bottles, notably Chocolate Stout, and particularly, Special London Ale. Why should they benefit from the tie system? (My opinion of Youngs has improved since the Bedford move as consistency and outright tastiness has improved considerably.)

I've had conversations on this theme rather often and inevitably someone will ask "well, Mr Opinionated , what would you do?". Here it is:

End the tie system; it's screwing the country's pubs and inhibiting the craft sector. Yes it would be a big upheaval and there is some merit in the argument that some nice cuddly, long-established traditional brewers would suffer and something should be done to protect them. I would impose two strict conditions that would allow the retention of a tied estate: a) if the company can prove it owned the pub continuously for the past 100 years it can continue to do so. b) that pub shall sell ONLY it's owners beers; not contracted, not licensed (it can be called the Sam Smiths principle.) I'd also automatically give listed status to all pubs 100 or more years old.

OK, my plan will need some fine tuning. I expect your comments will help.

(BTW, I'm not "anti-CAMRA", I'm CAMRA-sceptic. I'm pro-CAMRA-actually-achieving-real-progress.)


The Woolpack Inn said...

Well firstly I do hope that Tandleman does comment. Just put your handbags down!

I broadly agree that the tie is a problem. I'm not sure that there is an easy solution.

I am against the idea that a pub that is over 100 years old should be listed. Just because a pub is old does not make it profitable. Indeed old buildings are often much more expensive to heat, maintain and ensure compliance with our ever growing demand for safety.

Tandleman said...

Um. Yes. I will comment. In fact there was so much I wanted to comment on, I considered doing it on my own blog, but anyway I haven't.

The tie isn't anti competitive if it produces competition. If it allows a small brewer to make ends meet it is likely to provide more competition, not less. The problem arises when the tie becomes a monopoly in a given area. In Greater Manchester, we have Hydes, Lees, Holts and Robinsons competing for business. How would it help them to abolish the tie? Would it help the public? I doubt it.

I do have a liking for Family Brewers, but I really mean those that are wholly or majority family owned. Why shouldn't they have tied houses? It is they who take the financial risk, not shareholders. They stand or fall by their own products or those they choose to sell?

Some of the members of the Independent Family Brewers (IFBB) may be less than convincing however as members, as they are publicly quoted companies. Here I am talking about Fullers and Youngs for example, though they do have substantial family shareholdings. Greene King is not a member and cannot be uttered in the same breath as those who own the company entirely. You mix them up, but your conclusion may well be right about them.

In the end I think it isn't the tied system that is flawed per se, but its application in areas where it is in effect a restriction on trade to the detriment of the business and the public. The Government recognised this in the flawed Beer Orders umpteen years ago, but in the end we got something much worse. Choice is even more constrained and entry to the market is denied by PubCo's restrictive practices. At least in the "good old days" tie and all, we had plenty of different brewers to choose from.

Today Pub companies own 53% (or 30,400) of Britain's pubs. A lot of the rest, while owned by loads of different arrangements are often tied by loan, ownership or agreement.

The IFBB own between them 4200 pubs out of 57,500 (7.3%). They supply over 280 brands of cask ale.They are keepoing open when so many others are closing. Really they aren't the problem.

I do agree that CAMRA needs to point this out more. The figures back up drawing a clear distinction between the likes of Holdens and Hydes and Enterprise and Punch. CAMRA shouldn't be afraid at all of entering that debate and clearly articulating the arguments. The figures are on their side.

So where does the problem lie? It clearly lies where the restrictive practices hit hardest on both public and publicans. The Pub Companies.

Your solution would throw the baby out with the bathwater.

PS - I agree with what you say here: "I'm pro-CAMRA-actually-achieving-real-progress.)"

The Woolpack Inn said...

Oh, I was're here Birthday Boy.

Thanks Tandleman. I now need to go and do some more thinking, as if my head didn't hurt on this one already.

But, I don't believe Jeff is a nutter. He just has a view from his experience inside the industry that many have not got the courage to say to the punters. The only real difference between Jeff and me is that I'm trying to be more diplomatic and Jeff’s got more guts - or less to loose.

Tandleman said...

I don't think I called him a nutter. That was someone else.

Boak said...

A lot of food for thought in this one, and I'm glad you've suggested what could be done instead -- as many have said, coming up with the right legislation to hit "bad" pubcos and reward cuddly local brewers is pretty tough.

Also interesting what you were saying about Youngs. It's not an experience I recognise, but I don't know if they've changed their attitude in the last five years, or if the Youngs pubs I drink in are ones where they take their beer seriously.

Why is being "family-owned" a guarantee of quality? Surely it depends on the family. We've posted about this before, but having been to uni with one great heir to a big brewery, we shudder to think what's going to happen when he's in charge.