Pub vote result: Joy for Britain's struggling landlords as Government suffers a shock Commons defeat

Embarrassment for Michael Gove as 39 Coalition MPs defy whip

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A shake-up of Britain’s struggling pub industry is on the cards after the Coalition suffered a surprise defeat in the Commons today.

Fifteen Tories and 24 Liberal Democrat MPs defied their party whips to support moves to loosen big breweries’ control over pub landlords.

It is thought to have been the first time ministers have been defeated on a Commons Bill, and is a deeply embarrassing result for Michael Gove, who became Chief Whip four months ago.

MPs voted by 284 to 269 in favour of an amendment by the Lib Dem MP Greg Mulholland to sweep away many of the restrictions on so-called “tied pubs”, which are forced to buy drinks from the companies which own them and to comply with their rent demands.

The Commons broke into cheers and Mr Gove faced Labour taunts of “resign” when the vote was announced.

Under the amendment landlords will be allowed to shop around for beer and to negotiate their rents.

With around 30 pubs closing every week in the UK, supporters of the reform say the moves will ease financial pressures on landlords.

Ministers had offered to shake up the rent rules in two years’ time following a review, but this olive branch was rejected by MPs.

Mr Mulholland, who is chairman of the Save The Pub campaign, said the Government’s proposals would mean "business as usual".

He said his plans would “simply bring back market forces into a sector that frankly has become grotesquely anti-competitive”. He said: “It is closed to many smaller breweries and it is not working for publicans. It's not working for those communities losing pubs, and actually frankly it's not working for those large companies themselves.”

Gareth Epps, a Liberal Democrat activist and one of the leaders of the grassroots campaign, said: “This is an amazing win. We had a total budget of £1,500. Not in my wildest dreams could I have imagined it possible to win this vote against a government whip. Never doubt that a small band of committed citizens can change the world.”