Three main political parties agree need for beer-tie reform

17 March 2010 by
Three main political parties agree need for beer-tie reform

All three major political parties see the need to reform the beer tie, it emerged in a Parliamentary debate yesterday that was sponsored by Camra (the Campaign for Real Ale).

The event, which was chaired by Lib Dem MP and chairman of the All Party Parliamentary Save the Pub Group Greg Mulholland, saw the Tories, Lib Dems andLabour all agree on the principle of the tie itself but admit that the way in which it currently operated needed to be looked at.

Meanwhile Lib Dem Don Foster and Tory Tobias Ellwood said they would like to see the matter referred to the Competition Commission immediately.

"I don't see the principle of the tie as necessarily being wrong. The problem is at the moment is how it operates. That means that we do have to have some regulation around what is an acceptable arrangement and that's where the competition commission has got to come in," said Foster.

Labour's licensing minister Gerry Sutcliffe added that he personally thought the tie should be referred immediately. "I do no think the principle of the tie is a problem….But I think the overwhelming weight of evidence is that this is something that is a problem with individual companies. I think that the tie and the management of the tie does need to be looked at," he said.

Beer Duty

Meanwhile Ellwood revealed that the Tories would raise duty on some forms of alcohol in order to effect a reduction of duty on traditional beer. "Where there will be an increase in duties will be on the alcopops and so forth, but where there will be a slight reduction in duties will be the traditional beers that are drunk by the majority of people who go to traditional pubs and actually drink sensibly," he said.

And Foster called for an end to the beer duty escalator and criticised the Government for rising beer duty rates.

"Over the recent period of time, since Labour came to power, the beer duty has gone up by over 50%. When we had the VAT reduction in response to the crisis down to 15%, the beer duty went up 8% to compensate to take account of it. And yet when VAT when VAT went back up, did you see beer duty go down again? Of course you didn't. Beer duty increases have been seriously damaging to the industry and we believe the beer duty escalator has to come to an end," Foster said.

But Sutcliffe indicated that beer duty was a matter for the Treasury, which is busy putting the finishing touches to next week's Budget. But he did admit that a reduction in beer duty would be "difficult" given the state of public sector finances.

Minimum pricing

Foster also called for cheap supermarket alcohol offers to be curtailed through minimum pricing. "We also have to address the unfair competition that people in pubs are facing from pocket money prices in our supermarkets. That means introducing minimum alcohol pricing," he said.

Ellwood said the Conservatives would "pledge that we will prevent the below-cost sale of alcohol in supermarkets]." And he added that it was "morally wrong" to sell alcohol for less than the price of water. He said that it was up to shadow chancellor George Osborne to announce how his party planned to stick to its pledge.

Once again though, Sutcliffe sounded a note of caution on the issue of minimum pricing, warning that supermarkets would be likely to invoke European competition law in a bid to fight off the issue of minimum pricing. "If we are going down the minimum pricing route we have to be very careful about the challenges that you would face," he said.

GMB hits back at BBPA over beer-tie contracts >>

GMB Pub Revolution reps to meet new pubs minister >>

Government urged to clarify new licensing code >>

By Neil Gerrard

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