Boom or bust for the licensed trade?
The licensing trade is more entangled in red tape than it’s ever been and with pubs closing at a rate of 40 a week, could a three-way partnership between the licensing authorities, the police and trade be the answer?
Leading law firm Kitson Hutchings’ 2009 Leisure & Licensing Forum brought hot topics to the table to ask if it’s boom or bust for the licensing trade...
With serious economic decline and pubs closing at a rate of 40 per week, the hospitality industry faces some of its toughest times yet, especially in light of last week’s Budget which announced a beer duty escalator of 2% per year for the next four years. This comes on top of 2008’s “eye-watering” 18 per cent hike and is expected to add about 1p to a pint of beer, 4p to a bottle of wine and 13p to a bottle of spirits.
It was no surprise, then, that key members of Devon’s hospitality industry – publicans, restaurateurs and off licence owner/managers – along with representatives from the Devon & Cornwall Constabulary, local licensing authorities and members of the banking fraternity, turned out for Kitson Hutchings’ Leisure & Licensing Forum at The Passage House Hotel, Kingsteignton, Devon.
In a month in which major licensing issues, such as minimum pricing on alcohol, have received significant national media attention, industry came together to raise important issues which debated whether new legislation was in fact adding to the problems, rather than rectifying them. Could a three-way partnership between the licensing authorities, the police and trade be the answer? Or will the licensed trade continue to be driven by ill-informed policy?
“It is only a matter of months before our licensing and leisure industry will be under even more pressure as the government makes further changes to the Licensing Act of 2005. It’s important we give industry an opportunity to pose, and present, ideas and questions to an informed and authoritative panel,” said debate chair James Cross, joint Managing Partner at Kitson Hutchings.
Liberal Democrat MP for Torbay, Adrian Sanders, who is representative on the Culture, Media and Sport Select Committee, with responsibility for licensing matters, set the scene detailing current issues under consideration by the Parliamentary Select Licensing Committee. The simplification of licensing forms (over 65% are returned incorrectly completed), the amendment of licensing fees to better reflect the size of premise and its turnover and the new provisions for objections to TENs (Temporary Event Notices) were high on the list, including a review of the costs associated with TENs and the possible increase of individual allowance per licence-holder.
Also at the forefront of licensees’ minds is the policy concerning “irresponsible” drink promotions and the effect the smoking ban has had on the night time economy. Event-goers urged for updates on the review of staggered/later terminal hours and of statutory controls over adult entertainment. Sanders assured the audience that upon receipt of the Committee’s report, the government is obligated to respond within two months, with possible areas for change highlighted and objections raised.
The Licensing Act 2005 was introduced with the aim of ‘producing a balanced package of freedom and safeguards’ with regard to legislation governing the sale and consumption of alcohol and public entertainment licensing. However, public critics have questioned the viability and relevance of the Act and its implications. Contentious realities, such as the indoor smoking ban, along with 24-hour licensing, are all a product of its stipulation, with further changes due to take effect soon.
The issue of minimum pricing on alcohol has sparked fury that the current system is giving an unfair advantage to the supermarkets, with the pub trade seriously suffering as a result of heavily discounted alcohol. The UK’s drinking culture, the DPPO which stipulates no-smoking on the street, the impact of the Licensing Act on Live Music and the adult entertainment industry also generated much discussion.
"What the Chancellor has done is to confirm the duty increase promised in line with last year's alcohol duty escalator. This is in spite of the intensive lobbying of the Government to consider the impact of further duty increases.
“The pub industry will find this difficult to swallow at a time when six pubs are closing every day. There is clearly a risk that the speed and rate of closures may now increase as it seems likely that pub customers will seek alternatives and may indeed drink more at home," reported Stephen Broome, Hospitality & Leisure director at PricewaterhouseCoopers LLP, last week.
If a ‘three-way partnership’ between the licensing authorities, police and trade was introduced, perhaps positive change would be more actively promoted in the industry. A period without new regulations and with less enforcement would enable the existing Licensing Act to take effect.
Trade wish list for licensing
A trade wish list given to Sanders for consideration by the Select Committee, details a number of matters for concern:
a) A review of annual licence fees on account of difficult collection procedures and consideration for licensing authorities ability to revoke for non-payment.
b) Proposals for better industry regulation.
c) Assessment of the unfair competition the pub trade faces from the supermarket, primarily, in addition to high rents and drink prices.
d) Timely consideration given to the relevant procedures and requirements for renewal of 10 year personal licences in 2015.
e) Consideration for school education programs that highlight the dangers of excessive alcohol consumption.
“The licensing trade in Torbay, Devon is clearly taking the issues surrounding the new legislation very seriously. The views expressed highlighted the need for less crippling regulation and unnecessary costs with time for the industry to recover. Many of our clients’ businesses will be affected by the legislation and we wanted to highlight the problems and look at possible solutions. We’re pleased to have had the opportunity to offer in depth information on the proposed bills impact throughout Torbay and across the south west of England,” said Rob Newman, Head of Licensing, Kitson Hutchings.
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