Punch to disregard slot machine income when setting rents
Pub group Punch Taverns has come under fire after it announced it will no longer take slot machine income into account when setting rent levels.
The move away from ‘rentalising income' is intended to ensure Punch complies with Business and Enterprise Committee recommendations on transparency in its relationship with licensees.
The initiative will only be applied to Punch pubs that are re-let or subject to a rent review, which can expect to see a boost in income of around £1,250 per annum.
However, the move has been criticised by campaign group Fair Pint, which described it as "half-hearted".
"This news has been presented by Punch Taverns as good news for tenants when it is at best a half hearted response to the Business and Enterprise Select Committee's recommendation that the machine tie ought to be scrapped entirely," said Fair Pint founder member and tied tenant Steve Corbett.
He added that Punch's decision to stop rentalising machine income only applied at rent reviews or when tenants take on new leases showed that the group is not interested in helping tenants currently fighting for survival.
"The move seems less generous if you look at the figures in detail. If Punch is forgoing £1,250 a year of income from rentalisation, our calculations suggest that it is still keeping £4,500 a year of income," he said.
"Punch states that it will forgo £2m a year in income when its accounts show that its income from machines was £31.3m last year, an average of £4,000 per pub"
Punch Taverns declined to comment.
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By Emma White
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