Wednesday, 15 May 2013

New Dinoasaur Species Fossil Found In Solihull ...

Ted Tuppen, head of Enterprise Inns is reported as saying the movement of a mere £102 millions of economic value from pubcos to tenants mooted in the current government consultation on pubco regulation will lead to "unintended consequences", such as pubcos not having any incentive to support their tenants.

Amazing how Mr Tuppen can spin anything to his company's benefit. According to my daily email from Langton Capital, reporting on first half figures for Enterprise the support they provide is enumerated thus:
"The group subsidised lessees to the tune of £3m in H1 (no change on last year)"

Note the use of the word subsidised there, one assumes this means rent concessions? Perhaps if the rents being charged were not excessive (along with tied product pricing) no such subsidy would be required... oh, but wait... isn't that the point of the consultation and proposed regulation?

This £3 millions subsidy is presumably continued in H2, thus leading to an annual subsidy of £6 millions? If so the mean average subsidy across the estate is of the order of £1,049 per pub. Not the £10,000 per pub quoted by Mr Tuppen.

More from the Enterprise report:
"Capital spending is now less defensive in nature; it should settle at around £60m per annum"

Is this the £10,000 per pub per year "support" Tuppen speaks of? Sorry but capital expenditure on the fabric of ones own bricks and mortar can hardly be described as "support" for ones tenants.

If one reads elsewhere on Publican's Morning Advertiser about the number of tenants claiming tax credits, a fair proportion of whom are likely to be Enterprise tenants, then perhaps the natural conclusion is, despite their best efforts some tenants simply cannot earn enough to live on without being "subsidised" by other taxpayers. Hardly evidence that the existing pubco model is sustainable, let alone fair, and is only evidence for the urgent need of reform as championed by #fairdeal4yourlocal .

As for "unintended consequences" ... well those arising from the original Beer Orders, which, allowed the rise of such debt-laden behemoths as Enterprise have been pretty horrific for the national estate ... a 30% loss of pubs since the early 1980s.

Does anyone think things could become more dire for tied tenants if Tuppens portents of doom become manifest, as opposed to the "last chance saloon" mutterings of the dinosaur from Solihull?

I think not ... unless Tyranosaurus Tuppen would like to elaborate on his comments, one can only hope that T.Tup is in the same evolutionary dead end as T.Rex ...

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