Pubs Code for Scotland’s tied tenants: a blessing or a curse?


A proposed ‘Pubs Code’ for Scottish licensees in tied tenancies promises to protect their rights but could also lead to pub closures – according to the very consultation paper behind it.

Labour MSP Neil Bibby (pictured) lodged his Tied Pubs (Code and Adjudicator) (Scotland) Bill with the Scottish parliament on February 4th after it won cross-party support. A similar code was introduced in England and Wales in 2015 and Bibby’s Bill will now be debated and considered by parliamentary committees, then by the Scottish Parliament.

Neil Bibby said, “The Bill will reset the relationship between tied licensees and their landlords, giving tied tenants in Scotland statutory protection for the first time. It will also make it easier to bring locally-brewed products into the tied pub sector, helping local economies and boosting sustainability, while also offering more choice to pub-goers.”

But Bibby has also stated in the consultation document that pubs could close as an indirect consequence of the legislation, based on the fallout from the passing of the Bill in England and Wales. This has attracted criticism from The Scottish Beer and Pub Association (SBPA).

Said an SBPA spokesperson, “Far from protecting Scotland’s pubs, Mr Bibby acknowledges that his Bill may bring the risk of pub closures, and may also lead to fewer pub tenancies for those that wish to enter the pubs sector. These negative impacts would be damaging not only for pub goers, but also for those with entrepreneurial ambitions in our country’s hospitality sector.

“Scottish pubs contribute over £1.1 billion to the Scottish economy. They act as a key hub at the heart of Scotland’s communities and employ over 45,000 people right across our country. Despite this valuable contribution, pubs up and down the country already face very difficult market conditions and Mr Bibby’s Bill may hinder rather than help Scottish pubs.”

But there are some trade bodies that have come out in favour of the Bill.

Scottish Licensed Trade Association MD Colin Wilkinson said, “The only way to ensure Pubcos do not exploit their tenants is for the Scottish Government to introduce a robust code of conduct, which must be detailed, universal and comprehensive to avoid misinterpretations. There is also a need for an adjudicator to enforce that code and ensure that Pubcos are not exploiting tenants.”

CAMRA’s Scotland Director, Sarah Crawford, said, “Many pubs in Scotland are struggling because pub companies are taking more than is fair from the profits of their tied tenants.  This just isn’t fair to people running the pubs who are struggling to make a living, and is contributing to the loss of pubs across Scotland. It also impacts on the cost of a pint, and the availability of quality locally produced beers available in our locals.”

Tied tenancy reform is a drum that has long been banged, while operators with direct experience of the system likewise recognise that it serves a purpose, like getting licensees on the first rung of the ladder of pub ownership with less of an investment outlay than they’d otherwise need, like Glasgow operator Mark Lappin.

He said, “It’s a chicken-and-egg situation. It’s a great entry level business deal so that a good operator can work for themselves although you do need to have 20 or 30 grand to put down at least, like when I took on Maggie Mays in Trongate. It was a tied tenancy and was a great way to get to work for myself.

“Then I moved into freehold business and I got my beer 50 per cent cheaper, but I  wouldn’t have got into business without having a million pounds in my back pocket had it not been for the tied tenancy arrangement. Plus there are other financial pressures on tied tenants to factor in, like rates.

“Plus if the Bill becomes law, which I think it will the brewer could say ‘that’s fine you can get you beer from wherever you like as long as it’s my beer’.”


Read the consultation document here.

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