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Open letter to POB CEO's


Open Letter to POB CEO’s

 

This unprecedented period of extended pub closure, whilst understandable, has caused much comprehensible consternation for the Members of Justice for Licensees, with all sectors of the trade under pressure. Unfortunately for many of our Members this consternation has been heightened by the questionable actions of their so-called business partners, the Pub Owning Businesses (POB’s – formerly known as Pubcos).

 

Three weeks ago we issued a press release, entitled Save the Great British Pub, https://www.justiceforlicensees.org.uk/news.php?story=67  which highlighted the difference in practices between POB’s, with some deferring rentals – which would mean for the entire period of forced closure, an ever accruing debt for the licensees – and some cancelling rent – the actions of a true partner. We praised the likes of Admiral Taverns for their actions, we cannot do the same today! Following this press release, we have listened to our Members and much to our disappointment we have learnt that POB’s that had cancelled rent were now charging rent. The anger and disgust of our tenant members is akin to the anger and disgust that we witnessed in 2007, prior to the first review of the 2004 TISC enquiry in 2009. These unfortunate times have, once again, highlighted the greed and nefarious practices of POB’s.

 

Tenants are thankful for the help of Government, with grants of £10000 or £25000, dependent on eligibility. These grants are payable one per premises, for fixed costs, as nobody has any idea when pubs are likely to be allowed to re-open, licensees are having to budget, severely. For some tenants it has already become a case of which expenses to pay, we have heard many voices asking who should be prioritised. We have heard of tenants who are being put under duress to sign confidential agreements for a reduced rent, we have heard of POB representatives who are demanding that tenants inform them of any help that they may receive from Government! POB’s are entitled to their own help from Government, many of which are already making use of the facilities offered, however it would appear that they not only want their own help from Government, but they also want their alleged business partners as well!

 

With this in mind we have written an open letter to twelve POB Chief Executive Officers, as detailed below.

 

Inez Ward, founder of Justice for Licensees, said ‘Over the last fourteen years there have been many times that I have had to ask what the hell is wrong with these people? Once again I am horrified and disgusted at the actions of the POB’s. These are real people, real families, not some number on a spreadsheet and they are under some considerable duress, through no fault of their own, the last thing they need is alleged business partners adding to the pain already being suffered.’

 

Karen Fullard, Council Member, said ‘Surely business partners take the same hit in times of hardship?  Why do POBs think they can take the small amount of assistance available to tenants?  Short sightedness now by the POBs will decimate the trade even further.’

 

Kevin Roberts, Council Member, said ‘I fail to see how these multi-million pound profit POB’s can try and charge rent when the poor impoverished Tenants have no income other than the grants and are basically caretakers of the properties for the foreseeable future, being charged by their so called Business Partners for the privilege.’

 

Gladys Jones, Council Member, said ‘As usual the pubcos want it all ways, they have always had difficulty in sharing, be it the gain or the pain!’

 

Ends

 

 

Justice for Licensees

 

 

OPEN LETTER

 

Dear Gentlemen

 

As you will all be acutely aware, on the evening of Friday 20th March 2020, Prime Minister Boris Johnson and the elected Government took the understandable yet extraordinary step of closing all pubs and restaurants by the end of the evening.

 

We are writing to you with reference to your (in our opinion morally and ethically bankrupt) decision to charge tenants rent on businesses that have been forced to close by Government due to the Covid 19 pandemic. Many tenants were already struggling with the adversity of dealing with intransigent companies and onerous contracts as highlighted in successive Government inquiries since 2004, for many the pandemic and the actions of your companies may well be the final straw that breaks the camels’ back. Is this really what you want for your alleged business partners?

 

Justice for Licensees Tenant members are thankful for the help from Government, the same cannot be said for their alleged business partners! Tenants with a Rateable Value of less than 51K may receive a grant of 10K for a RV up to and including 15K, tenants may receive a grant of 25K for a RV of over 15K and less than 51K, unfortunately tenants with a RV of 51K or over will not be eligible for this scheme. Only one grant per property will be payable. Government have not said when pubs will re-open, that said we believe that common sense will dictate and that pubs will be some way down the list in Government priorities, with dates as late as December being mooted it is a challenging time for the entire industry.

 

Tenants in particular, should they be eligible for one of the grant funding schemes, are having to face the possibility of stretching their grants over many months. Tenants will have many expenses and no income, which expenses, exactly, do you suggest that they don’t pay so that they can pay your rent? Perhaps you would like them not to pay the gas and electric bill, or perhaps the water bill? Perhaps tenants living without these essential services would be a satisfactory outcome for you? How about not paying pest control, perhaps swathes of rat run estates would be a satisfactory outcome for you? Perhaps not carrying out essential repairs, perhaps an estate in a worse state of repair than it currently is would be satisfactory? Perhaps alarm systems, perhaps deaths from carbon monoxide poisoning or fires would be satisfactory, or ransacking/vandalism of premises? We could go on and on and on, but hopefully you will have got the point! Whilst your tenants may live hand to mouth, worrying themselves sick over the situation, worrying how the hell they are going to pay for essentials, how much will you earn? Will you face losing your business and home at the same time? We are pretty certain that you will not be sharing your tenants pain……

 

As a company/corporation you have the ability to gain your own help from Government, we are aware that some of you are already furloughing staff and some are approaching bondholders and banks for help during the lockdown. You have the help for your business and the tenant has the help for theirs, it would now appear that you want the tenants help as well as your own, is this correct? We are aware that some BDM’s have been demanding that the tenants immediately report of any Government help they may receive, what gives you the right to do this? How could any of this be construed as fair business practice?

 

Rental levels are, supposedly, set on Fair Maintainable Trade, from the 20th March 2020 and ongoing for an indefinite period the level of FMT across the trade will be zero, ergo rental levels should be zero for the entire period, can you please confirm that this is the case? If this is not the case, then could you please explain why it is not the case?

 

On the coal face your assurances of help for your tenants are just meaningless platitudes, your actions will always speak louder than your words and to date your actions are speaking volumes.

 

For ease of understanding, we have bullet pointed the transparency that tenants are requesting, below:

 

  • ·         Are you going to offer any tangible and beneficial help to your tenant’s that may face bankruptcy due to the forced closure of their premises?
  • ·         For those tenants in the unenviable position of having to decide who to pay, which expenses do you recommend that the tenants do not pay in order to be able to afford the rental charge?
  • ·         Why do you think that you should deserve rental payment over and above other expenses that the tenant has?
  • ·         As the alleged business partner of the tenants, why should you be taking rent on a premises that they cannot legally operate, through no fault of their own?
  • ·         Your company has Covid 19 help available from government, the tenants have help for their business, why do pub companies consider it morally and ethically correct to take your tenants share of the help?
  • ·         Why do company representatives have the right to demand that tenants immediately report of any government help they may receive?
  • ·         How do you and your company consider that your actions have been fair business practice?
  • ·         Can you please confirm that, as FMT will be zero for the entire period of forced closure, that rental levels will be zero? If this is not the case, then could you please explain why it is not the case?

 

We look forward to receiving your responses with all due haste.

 

Regards

Inez

 

For the attention of:

Simon Longbottom – Stonegate Pubs

Clive Chesser – Punch Taverns

Kevin Georgel – St Austell Brewery

Nick MacKenzie – Greene King

Ralph Findlay – Marstons

Lawson Mountstevens – Star Pubs and Bars

Tom Davies – Brakspear

Stuart Bateman – Batemans

Allan Lockhart – New River Retail

Rick Bailey – Thwaites

Chris Jowsey and Tom Ward – Admiral Taverns

James Holler – Wellington Pub Company

Mark Brown – Trust Inns


Sunday 26th April 2020

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