Saturday, 24 January 2009

Restraint of trade

At times in the past I have been critical of CAMRA for seeking anti-competitive solutions to the perceived ills of the brewing industry and pub trade. In the long run, real ale and pubs will only survive if consumers positively want them. Hobbling the competition can only deliver a short-term fix. However, I must applaud their latest campaign against restrictive covenants on pub sales. If a pub operator has a pub they no longer think is viable, they are fully entitled to sell it off. If nobody else thinks it is viable either, then it will be sold “for alternative use”. But if someone else thinks they can make a go of it as a pub, then why should they be prevented from doing so by a restrictive covenant? There are plenty of thriving pubs up and down the country that had been cast off by major pub owners as “unviable”. The market should decide which pubs are viable, not pub companies, and restrictive covenants are just a means of protecting the trade of failing pubs.

7 comments:

  1. I see you are one of the many who love the “free” market until it destroys something you value. If we'd had a free market in beer and pubs for the last 40 years we'd all be drinking Watney's Red Barrel or Double Diamond now, unless the Beer orders had been truly “free” then your choice would be Punch, Enterprise or Wetherspoons selling Red Barrel or Double Diamond. “Free” markets breed monopolies and monopolies will protect themselves by controlling outlets – hence covenants.

    ReplyDelete
  2. What nonsense.

    A key feature of genuinely free markets is the prevention of monopolies.

    And we currently have 600+ microbreweries without any State sponsorship whatsoever.

    ReplyDelete
  3. Yeah I've read Adam Smith as well and I agree but you notice the inverted commas, we don't have genuuinely free markets, we have reality. Covenants aren't new by the way I know of a former pub that has been a jewellers since the 1890s with a no alcohol to be sold covenant still in place.

    I think progressive beer duty could be (loosely) termed as State sponsorship.

    ReplyDelete
  4. I'm not a great fan of the free market but agree with your post on this occasion. I'm not a great lover of CAMRA despite being a member.

    ReplyDelete
  5. My thoughts about CAMRA

    I'm a life member, but nowadays tend to value it primarily for the local social network it provides.

    Much of its "campaigning" is wrong-headed and a waste of time.

    ReplyDelete
  6. Whether a fan of free trade or not,
    I agree with the original post, covenants inhibit free trade.

    ReplyDelete
  7. ...that's not quite what I meant.

    Whether a fan of free trade or not covenants are bad for pubs and are a means of big pub co's preventing competition.

    ReplyDelete

Comments, especially on older posts, may be subject to prior approval. Bear with me – I may be in the pub.

Please be polite and remember to play the ball, not the man.

Any obvious trolling, offensive or blatantly off-topic comments will be deleted.

See this post for some thoughts on my approach to blog comments.