The traditional English pub is being eaten alive by corporate consolidation

Guardian Weekend, 23 July 2005

Behind the bar counter, eighty-four year old Mary Wright pours me a pint of Otter Head beer. Mary is the landlady of the Luppitt Inn, in the tiny Devon village of Luppitt. She is also the last steward of a time capsule.

Half a century ago, the country was dotted with pubs like the Luppitt, which is little more than the front room of Mary's old stone farmhouse. It has a tiny wooden counter, one battered table and two small casks of beer brewed in a microbrewery at the top of the valley. The walls are decorated with cobwebbed photographs of old village life. There's no till, price list or handpumps, and the room can hold perhaps ten people at a push. The toilet is across the farmyard, in a shed with no electricity. The pub has been in Mary's family for a century and when she goes, it will probably go with her.

Tonight it's packed with red-faced dairy farmers who have come from a meeting in the village hall. The talk is of fertiliser, the stupidity of the Cornish and a local dog which may or may not be part-wolf. Fifty years ago, maybe even 100, you could have walked through the half-door of the Luppitt and been greeted with much the same sight.

'It's changed, of course,' says Mary, as she pours the beer. 'There used to be dairy farms all round here. Not any more. A lot of new people moved into the village and they don't come in here. There's no living in this now. It's more like an old car. You put in more than you get out. But I do it for the regulars. '

Waiting for my beer, I am keenly aware that I'm bearing witness to a way of life that, in most other parts of the country, is already long-dead. Somehow, the Luppitt Inn has remained unchanged as the rest of the world has moved on. It is a portrait of how things used to be in an institution which, for centuries, has been one of our cultural keystones: the pub.

A hundred and thirty miles away, up a narrow lane on the edge of an Oxfordshire village, James Clarke stands looking up at the yellow stone and dark wood of his Victorian tower brewery as it belches clouds of beery steam across the fields. The Hook Norton brewery is the only steam-powered brewery left in the country. Clarke, who inherited it from his father last year, is the man charged with steering a path for his 150-year old business, with its horse-drawn drays, steam-driven brewing engine, mash tuns, spurging pipes, fermenting rooms, grist mill and malt loft, through the new and ruthless world of the modern drinks industry.

'If we'd have sat here ten years ago', he tells me later as we sit in Hook Norton's in-house bar, 'and you'd said that when we next sat down, now, Morrells brewery wouldn't be here, and Brakspear's wouldn't be here and Morland wouldn't be here, I'd have laughed. And they've all gone.' He recites the names of his three former regional competitors with regret rather than relish.

'There's been a lot of change', he says, understatedly.

Clarke knows he is one of the lucky ones. Thanks to good management, good beer and probably a degree of luck, Hook Norton survives in a world very different to the one it was born into in 1849. But it is one of just 38 regional breweries that do. Hook Norton, like the Luppitt Inn, is a remnant of the past in a world where the future looks very uncertain.

In 1900, there were more than 6000 breweries in the UK. Today there are just over 500. Thirty three have closed since 1990, taking over 130 regional and national beer brands with them. The last decade has seen the end of, among others, Morrells of Oxford (founded 1782), Brakspear of Henley (1799), Castle Eden of Hartlepool (1826), Morland of Abingdon (1711), Ruddles of Rutland (1857), Courage of Bristol (1702) and Mitchells of Lancaster (1871) - names that were sources of national heritage, regional pride and local employment sold off, shut down or taken over. In 2005 we will say farewell to Strangeways of Manchester (brewers of Boddingtons) and Newcastle's Tyne Brewery (home to Newcastle Brown). They are unlikely to be the last.

Then there are the pubs which the breweries serve. Twenty of them close every month - converted into housing, theme bars or luxury flats. Half of those that remain are in the hands of ambitious and rapidly-expanding pub corporations which have set about remaking them with the help of loans from Japanese banks and marketing techniques developed in pizza and sandwich chains.

Rural pubs are disappearing with unprecedented speed, leaving many villages 'dry' - bereft not just of a place to drink but of the community focus that went with it. In towns and cities, giant high street drinking sheds - known in the trade as 'high volume vertical drinking establishments' - open in their place, selling alcopops to teenagers and fuelling the 'binge drinking' phenomenon. The last ten years have witnessed an explosion of identikit chains - O'Neill's, All Bar One, the Slug and Lettuce, Wetherspoons - in what critics call a whirlwind 'McDonaldisation' of the traditional pub.

To put this in context, imagine that it's happening in France. Imagine that classic grape varieties - Pinot Noir, Riesling, pink Muscat - are no longer being grown; that the chateaus which produced them are being converted into luxury flats for wealthy Parisians. Imagine that you can no longer buy Veuve Clicquot, Mouton Rothschild or Sancerre. Imagine that instead people are drinking a few heavily-marketed varieties of imported Australian or Californian wine distributed by a handful of drinks corporations. Imagine the riots on the streets of France, and the outrage in the diningrooms of middle class houses all over Britain.

Substitute 'beer' for 'wine' and you get some idea of the significance of what is happening here. There was a time, not so long ago, when the country was a tapestry of tastes woven from its national drink; the dark, hoppy beer known originally as 'ale.' Its tastes, flavours, ingredients and history vary as much as the atmosphere and interiors of the pubs which sell it. In English beer and the English pub we have, whether we know it or not, something unique. And it is being lost.

If you think this is an exaggeration, then hear it from a Frenchman. Hilaire Belloc, the poet who made England his home in the early 20th century spent much of his time here quaffing flagons of ale in various taverns. Amongst all the guff about Empire, cricket and the playing fields of Eton, Belloc thought he had pinned down where the heart of his adopted nation really lay. 'When you have lost your inns', he said, 'drown your empty selves. For you will have lost the last of England.'

To Belloc, the pub - the institution of the ordinary people - was closer to the nation's pulse than the monarchy, the Church of England or the 'Mother of Parliaments' would ever be. He was not alone in singing its praises. Samuel Johnson famously delivered himself of the opinion that 'there is nothing which has yet been contrived by man, by which so much happiness is produced as by a good tavern or inn.' Belloc and Johnson weren't just talking about the beer (Johnson, in any case, preferred wine - and plenty of it). They were talking about the atmosphere that made the pub what it was. The debates, the discussions, the games, the drunkenness, the foibles of the landlord, the conviviality, the unpredictable gathering of diverse people; the indefinable something which made every pub different to every other.

The pub has an ancient history. The Romans imported its predecessor, the tabernae, in the 1st century AD. By the 10th century, beer-drinking was such a popular national pastime that King Edgar initiated the first government campaign against binge drinking, issuing a law limiting the number of alehouses in each village to one, and decreeing that only half a pint could be drunk at any one sitting. It failed miserably, and over the ensuing centuries taverns, alehouses and inns - originally developed as watering holes for medieval pilgrims - multiplied with an unstoppable momentum.

But the pub and the 20th century were set for a collision. After World War Two, the biggest brewers became more ambitious, and by the 1980s, the six largest national brewers owned over half of the country's pubs and produced 75% of its beer. Over the same period brewers began to turn their backs on traditional ale, focusing instead on newly-developed 'nitro-keg' beers - pasteurised versions which were cheaper to brew, travelled better and lasted longer - and heavily-promoted lagers. They began, too, to brand their pubs, ripping out historic interiors and putting in 'themed' replacements.

But the big brewers had pushed things too far and Margaret Thatcher, who hated both monopolies and brewers (whom she regarded as part of the Old Establishment) swooped. In 1989, acting on a recommendation from the Monopolies and Mergers Commission, the Tory government introduced sweeping legislation to end the brewers' dominance. The 1989 'Beer Orders', as the legislation became known, decreed that no brewer could own more than 2000 pubs. Furthermore, they would now have to give their landlords the option of selling at least one 'guest beer' produced by a rival.

The idea was simple: the smashing of the monopoly would see a flowering of smaller brewers, more varied pubs and more choice for drinkers. Everyone - except the big brewers - would win.

Roger Protz grins sheepishly when I ask him what happened next. Protz, probably the best-known beer writer in Britain, is a leading light in the Campaign for Real Ale (CAMRA), which was founded in the 1970s to fight the corner of traditional beer and pubs. He sits on a swivel chair in CAMRA's head office in St Albans and considers what went wrong.

'Basically, I think we were tremendously naïve' he says. 'We were very optimistic. The Beer Orders said that the big brewers couldn't own more than 2000 pubs, and we thought "they'll be happy with that." They weren't happy, because they weren't prepared to open their pubs up to other brewers' beers.'

The Beer Orders did not, after all, break up the monopoly of pub ownership and beer-brewing: all they did was to shift it sideways. Rather than sell off some of their pubs and keep the rest, the big brewers created something new - pub companies - to which they sold all their pubs. Because they didn't brew beer themselves, the companies - known as PubCos - were exempt from the legislation.

'There were a lot of sweetheart deals' explains Protz. 'The brewers would say to some of their management team "here's a golden handshake, go off and start a pub company. Buy a tranche of pubs and in return, only take our beers." And that was what happened.'

Today it is the PubCos, not the brewers, who call the shots. In 1989, the six biggest brewers owned around 30,000 pubs - half of the country's total. Today the ten biggest PubCos own around the same number. The two biggest own a quarter of all pubs between them. Meanwhile the six biggest brewers - now multinational companies - own no pubs at all, but produce a higher proportion of beer than they did in the 1980s - eight out of every ten pints drunk.

'My own personal feeling is that the situation is worse', says Protz. 'The national brewers saw pubs as places they could sell their beer. Modern pub companies see pubs as real estate, and if they can sell them all and make money that way, they'll do it … Customers are quite blatantly referred to as "traffic". You don't want old Charlie going in and sitting all night over a pint of mild and bitter. You want people coming in, having a few drinks and going, and being replaced by somebody else.' He looks frustrated.

'Everything is about profit now', he says. 'Of course the old brewers were there to make money too. But they understood that pubs had a community role. The modern pub companies just couldn't give a stuff about that.' He shakes his head.

'The corporatisation of pubs', he says. '… I really have no idea what to do about it.'

Tony Jenkins knows what he'd like to do about it, but he thinks it may be unprintable. In the dark depths of a January evening he is standing in an alley in central Leeds outside the local branch of Mook, a national chain of bars aimed at hip young dudes. Tony is not a hip young dude. He is the chairman of the Leeds branch of CAMRA; a large, jovial man wearing a fleece with the words 'Tetley Bittermen' emblazoned on it. He shivers in the cold and sticks his hands into his pockets.
'I'm not going in there', he says. 'It's a matter of principle.'

Mook, until recently, was a traditional backstreet local called The Whip. Then it was bought by the Spirit Group, one of the country's youngest and most ambitious PubCos. 'It was really quite sad' says Tony, 'because there were people who'd been there every week for 50 years, you know. And Spirit came along and just trashed it. Where did those people go? It's not that I object to bars like this, but Leeds is full of them. We didn't need another' - he wrinkles his nose and spits out the word - 'Mook.'

A few hundred yards away, down another alley off a shopping street, lies what Jenkins calls 'the last real city centre pub in Leeds.' Whitelock's is something of an institution. The 300-year old tavern has been hymned by the likes of John Betjeman, Peter O'Toole and Keith Waterhouse for its atmosphere, its beer and its regional cuisine. Its Yorkshire Puddings and jam roly-polies are particularly praised.

Or they used to be. That was before the Spirit Group got hold of Whitelock's too. You won't find jam roly-polies or Yorkshire Pudding on its menu now. You'll find nachos, penne pasta and Kashmiri chicken. You'll find, in fact, the sort of food sold in all the other Spirit Group pubs around the country.

Tony and I squeeze into the long, narrow bar and order a couple of pints. The 1880s interior is a riot of carved wood, old tiles, brass, decorated mirrors and very low beams. Tonight's customers range from a white-haired old man slowly rolling cigarettes in a corner, to a pair of twenty-something lovebirds gazing into each others' eyes over pints of Staropramen.

The cloning of the Whitelock's menu caused fury in Leeds last summer. In August 2004, a journalist on the Yorkshire Evening Post got hold of an internal memo that had been sent to the pub's staff. It described two imaginary customers who represented the sort of clientele that the PubCo now wanted Whitelock's to attract.

'Mick and Ruth' were two work colleagues: he was a manager who drove a BMW and drank beer; she was an office worker who ate pasta and drank pinot grigio wine. They were both busy, modern, business-minded people and neither of them, apparently, was interested in Yorkshire Pudding. Soon after the memo went round, the menu and wine list were changed by head office. Fearing that the Spirit Group wanted to do to Whitelock's what it had already done to The Whip, over 1400 people signed a petition urging the PubCo not to touch "this gem of the north." But many people, Tony Jenkins included, are still nervous.

'If you dredge through the Spirit Group website', he says, conspiratorially, 'you discover that they have chains within chains. They have "Spirit locals", "city day pubs" - all these "concepts." I think they decide what to do with their pubs by using postcodes. Whitelock's is in LS1, and somewhere in the Spirit Group manual it will say "a pub in the city centre has to be an alcopop bar for 14 year olds." What they wanted to do was make Whitelock's fit their brand.' He downs the remains of his pint.

'But', he says with satisfaction, 'they got caught.'

'I've got a huge dislike of things corporate,' says Karen Jones.

This seems a curious statement from the Chief Executive of a £500 million company. But Jones, CEO of the Spirit Group, is one of the new breed of dressed-down, tousle-haired, Branson-esque corporate bosses. Jones, the woman who founded the Café Rouge and Dome chains, now directs operations in her 2400 pubs from Spirit's giant, call-centre-style HQ in Burton-on-Trent.

'Look, this Whitelock's story', she says. 'The truth of the matter is that in July last year we painted it and put new curtains in it, and changed the menu. That's all. I think people were very worried that we were going to change it in some way that was deleterious. Nothing could be further from the truth.'

The Spirit Group is a centrally-controlled operation. That, says Jones, is the way to 'make standards as good as we can make them, all the time.' Spirit has done away with landlords - who rent their pubs and then run them largely on their own terms - and replaced them with managers, who take their orders directly from head office.

That way, says Jones, 'all our customers are our customers. We have a direct relationship with them … everything's based on great relationships with the customer. If you don't get that right you might as well pack up and go home … We need to motivate our managers - the people who actually give you a pint of Carlsberg or bring a burger to your table - to do the job that we want them to do.' She denies, though, that this means imposing the same model on every pub.

'I'm firmly against this march of cookie-cutter brands', she insists. 'Part of our job as a pub company is to avoid being in any way bland or corporate.' It's important to understand, she says, that pubs, like any other part of society, change with the times. 'The number of people visiting pubs is increasingly overall', she says - but only because companies like hers are changing them to meet new demands - less beer, more wine and, most of all, more food - 'the growth part of the market.' This is what people want, and this is what the Spirit Group are going to provide - but in a way, insists Karen Jones, which makes all her customers 'feel like individuals.'

How this desire to help people 'feel like individuals' squares with the company's modus operandi, is unclear. For the Spirit Group is very big on demographics. It divides its pubs into what Tony Jenkins calls 'chains within chains' and Karen Jones prefers to call 'groups of pubs that trade to particular groups of customers.' There are 800 'Spirit Locals', which themselves are divided into smaller groups with names like 'great locals' ('big-hearted community pubs'), 'young and classics' ('where the community live'), and 'sports'. There are 600 'City Spirits', which include 'Bars and Clubs' ('the place to be seen') and 'City Night' ('the best night out in town'), and 500 'Spirit Foods' with brands like 'Chef and Brewer' and 'Two For One'. Each grouping targets different markets - and every time it is head office which decides.

'We won't have an individual menu for every single pub', confirms Jones. 'That would be unworkable with 2000 pubs. And also it's not the way to keep pushing quality up. As I know from rolling out 150 Café Rouge, trying to do fresh food on a mass scale - the pitfalls are many.'

This, in a nutshell, explains what happened to Whitelock's and Mook. They didn't fit the blueprint. The Spirit Group, like other big PubCos, is making the stock market very happy by applying the operating techniques of chains like Pizza Express and Café Rouge to the traditional pub. In the process of doing so, they are replacing the very things that make each individual pub distinctive - from the menus to the bar furniture to the atmosphere - with manufactured environments, imposed from above. From where Karen Jones is sitting this is the way to 'ensure consistency'. From the alley outside Mook, or the dining room of Whitelock's, consistency looks more like the problem than the solution.

Meanwhile, out in the country, rural pubs are facing their own problems. The village pub, while it has less chance of being turned into a branch of Mook, is probably under even greater threat than its urban counterpart - and since the country pub seems to be burned into the psyche of the English nation, its rapid decline is perhaps even more of an issue.

The Countryside Agency laid out the scale of the problem in 2001, when it reported that, for the first time since the Norman Conquest, more than half of the villages in England were without a pub. The 7000 rural pubs that remain are closing at the frightening rate of six a week.
It's not hard to see why. The decline in rural pubs mirrors an equivalent decline in village shops, post offices and other services. As more villages become dormitories for commuters or collections of holiday homes, community pubs fall with rural communities.

But this is not the whole story. A closer look reveals a tale of profiteering at the expense of rural pubs. A rural local, run well, can usually make a decent living for its tenants. But for PubCos, answerable to shareholders looking for quick returns, decent livings are not enough.

Mike Bell's pub, the Portobello Gold, is in Notting Hill, London; but he takes a keen interest in the fate of the rural pub too. Bell is the founder of Freedom For Pubs, a pressure group he set up last year to tackle the 'injustices' imposed on landlords by PubCos and market pressure.

'In the case of rural pubs,' says Bell, 'it's simple: with today's property prices, a pub is never going be worth as much as a private house. So PubCos, brewers and some private individuals look to turn them into homes. Their problem is that they have to apply to the council for "change of use" permission - and they have to show that the pub is unviable before it will be granted. So what do they do? They run the pub into the ground; deliberately employ the wrong tenant, or raise his rents so high that he can't make a go of it. Then they turn round and say "sorry, we can't make it work".'

The result has been a wave of rural pub closures, as local drinking holes make way for luxury homes. Those that survive often do so by joining the new wave of 'gastro pubs' - essentially rural restaurants with bars attached which, while often popular in themselves, are as far away in atmosphere and purpose from the rural community pub as a supermarket is from a village shop.

According to Mike Bell, landlords from both town and country are united in facing a common enemy: the market-driven greed of the PubCos. Theme pubs and cloned menus are a concern, he says, but the issue for most landlords today is a starker one: basic survival.

'I've got toe-curling, stomach-churning stories about what PubCos are doing to pubs', he says. Since Bell set up Freedom For Pubs he's received testimonies from hundreds of unhappy landlords, many of them sent anonymously for fear of reprisals.

'The problem is what's called the "beer tie"' he explains. 'I pay rent to Enterprise Inns, the PubCo which owns my pub, but I also have to buy all my beer from them. The PubCos are actually uncompetitive wholesalers, and they're driving pubs into the ground.'

Francis Patton, though, is having none of it. Patton is customer services director of Punch Taverns, the country's second-biggest PubCo, which owns 8400 pubs, and he says Mike Bell has got it wrong.

'It's not in our interests to make life difficult for our tenants', he insists. 'We're only as successful as the people we have running our pubs. You've got to understand the way the model works … if you want to own and run your own pub, as a Free House, it will cost you about £450,000. If you take a lease with us, the deal is that you pay a lower than market price rent on your property, and you buy all your beer from us. Therefore, we take part of the risk.' It is, he says, a bargain.

Tell that to Andrew Hall, who has run the Rose and Crown pub in Oxford for 22 years. Hall looks like a traditional landlord might be expected to look: he's round and bearded, smokes cigarettes and enforces a 'no dogs or politicians' rule on his premises at all times. He is also, since Punch took over his pub, in financial trouble.

'I'm not singling out Punch', he says. 'My criticism is of PubCos in general. The basic problem is simple. When pubs were run by brewers they charged us very low rents and we had to buy all our beer from them. Now they're run by PubCos who are charging high rents, and we still have to buy all our beer from them, at very high prices. As a result, this is now a business where you can't make money.'

'My rent', he explains 'has doubled since the late 1980s. I'm presently paying a rent of about £26,000 a year, and it's about to be raised again by another five thousand or so. Punch says - all the PubCos will say this - that this is a low rent to pay for a business. This may be true but it's beside the point, because in no other business will you have to buy all your products at cripplingly high prices from the person who rents you the premises. Punch will sell me 18 gallons of Adnams bitter for £145. The market price is £60, but I'm not allowed to buy it elsewhere. When my wife and I started as tenants here we were doing very well. Now we're heading towards bankruptcy. We're earning a third less now, in real terms, than we were twenty years ago, even though our business is doing as well, if not better. In what other trade could you say that?' He sighs. 'The PubCos have got us up against the wall.'

On the table between us, in the pub's low, wooden front room, sits a folder of documents. From it, Andrew Hall pulls a newspaper clipping from early 2004, detailing how Punch's 37-year old chief executive, Giles Thorley, has pocketed £3.6 million from selling some of his shares. In total, says the article, Thorley is estimated to be worth around £20 million.

'Look at this', says Hall, gesturing with his cigarette. 'Giles Thorley. The man's a great entrepreneur. I don't want to discourage great entrepreneurs in our society. But he's made his money by taking my living away from me. And that I find hard.'

Whether the Rose and Crown will survive remains to be seen. In the meantime though, the corporatisation of pubs - and the cultural loss it represents - marches on. PubCos, when challenged, will say that change is inevitable; they are simply responding to it. The issue, though, is not whether pubs change - they always have and always will. The issue is how they change - and who changes them.

There was a time when the state of the English pub could be said to define the state of England. Today the state of the English pub is increasingly defined by the stock market. And when the rough edges, the variety of character and the sheer bloody-minded localness of the traditional pub meet the brands, images, chains and concepts of modern corporate culture, it's not hard to work out which will triumph.