MPs accuse pub trade of overcharging customers

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The Independent Online

MPs have accused the pub industry of overcharging customers by not giving its licensed tenants a fair deal on beer and rent.

MPs have accused the pub industry of overcharging customers by not giving its licensed tenants a fair deal on beer and rent.

Hearing evidence from trade associations yesterday as part of an inquiry into pub companies, MPs on the Trade and Industry Select Committee voiced concerns that there is no transparency in how rents are set nor in the beer price they charge tenants. About half of UK pubs are run by pub companies, or "pubcos", which rent out pubs and supply beer to individual tenants.

Martin O'Neill, the chairman of the committee, said: "The pubcos describe their relationship with tenants as a partnership. But it does not appear to be a partnership of equals." MPs fear customers are paying more for their pints because pubcos refuse to pass the prices they negotiate with brewers on to their tenants. They also believe tenants are not getting adequate information when they sign up for a lease.

But the Association of Licensed Multiple Retailers, which represents a number of pubcos, rejected calls by MPs for a code of conduct to govern the relationship between pubcos and tenants, saying it would hamper the industry's flexibility. It also dismissed suggestions for pubcos to divide their businesses between property and beer wholesaling.

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