TWO rebel Hampshire MPs struck a blow against “rip-off” rents and beer prices by helping to defeat the Government over the power of the big pub owners.

An alliance of Liberal Democrat and Conservative backbenchers, with Labour support, stunned ministers by forcing through an amendment to break restrictions on 'tied' pubs.

It means landlords will be able to negotiate to pay “market only” rents, instead of paying rates set by either the brewery or 'pubco' which owns their pub.

But some large pub chains warned them move could cost thousands of jobs.

Under the proposals landlords will be able to buy beer on the open market, rather than from the owner - changes which, campaigners believe, can slow the flood of pub closures.

There have been growing protests over the large companies, those with 500 pubs or more, ramping up beer prices to - it is claimed - 70 per cent higher than independent suppliers.

Among the 40 rebels were Liberal Democrat Mike Thornton (Eastleigh) and Conservative Andrew Turner (Isle of Wight), who defied the Coalition whips.

They joined Labour MPs John Denham (Southampton Itchen) and Alan Whitehead (Southampton Test) in helping to defeat the Government, with a majority of 25.

It was the first time since the 2010 general election that the Government had been defeated on a Bill supported by both Coalition leaderships.

All other Hampshire Conservative MPs backed the Government, on the amendment to the Small Business Bill.

Enterprise Inns said yesterday's successful Commons rebellion ''threatens to have serious unintended consequences for publicans and the industry at large''.

The British Beer and Pub Association (BBPA) said the vote was ''hugely damaging'' and that the Government's own research showed it would result in 1,400 more pubs closing, with 7,000 job losses.

But the Campaign for Real Ale (Camra) said the change would secure the future of pubs, helping them to stay open and ensure the cost of a pint remained affordable. It was also backed by the Federation of Small Businesses (FSB).

The vote saw the Government suffer its first legislative defeat - by 25 votes - as Tory and Liberal Democrat MPs rebelled against the Coalition to support an amendment to the Small Business, Enterprise and Employment Bill.

It will mean pub tenants tied to big companies being able to demand a ''market rent only'' (MRO) agreement from them.

Simon Townsend, chief executive of leased and tenanted pub operator Enterprise, which has 5,500 pubs, sounded a grim warning.

He said: ''This amendment, which was not supported by the Government, threatens to have serious unintended consequences for publicans and the industry at large.''

He said a Government review had rejected the ''market rent only option'' as damaging to pubs, communities and the wider industry, and would lead to ''widespread pub closures, significant job losses and reduced investment in the sector''.

Mr Townsend added: ''We continue to believe the tie offers the best operating model for the vast majority of our publicans.

''In light of yesterday's vote we will continue to assess all options to safeguard the interests of both our publicans and shareholders.

''In the meantime we will monitor the situation closely and await the Government's response to this unwelcome development.''

Punch Taverns, which has around 4,000 leased and tenanted pubs, said the reform ''would have significant adverse consequences for Britain's community pubs''.

It said the Government had earlier rejected the mandatory ''free-of-tie'' option of tenants as it was likely to have caused uncertainty and ''unnecessarily risked leading to higher levels of pub closures and job losses''.

The group said: ''The Government's own research indicated that breaking the tie would be expected to result in between 700 and 1,400 more pubs closing with 3,700 to 7,000 job losses.

''Furthermore, we believe that the amendment would be likely to have the effect of reducing pub investment, reducing consumer choice and exposing tenants to higher fixed rents, reduced levels of support and greater risk of failure.

''We are currently considering the potential impact of the amended Bill on Punch, including the implications for our substantial pub investment programme and our disposal plans.''

Shares in the group were down 9% while Enterprise fell 14% and Spirit Pub Company was 6% lower.

 

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