Calling Time

Behind the bar, 84-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 one of the last custodians of a dying tradition.

Half a century ago, Britain was dotted with pubs like the Luppitt, which is little more than the front room of Mary's stone farmhouse. It has a tiny wooden counter, one battered table and two small casks of beer from the 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 10 people at a push. The pub has been in Mary's family for a century; when she goes, it will probably go with her.

Tonight, it's packed with red-faced dairy farmers. The talk is of fertiliser, the stupidity of the Cornish and a local dog that may or may not be part-wolf. Fifty years ago, maybe even 100, you could have walked into the Luppitt and been greeted with much the same sight. "It has changed, of course," says Mary as she pours the beer. "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."

On the edge of an Oxfordshire village, 130 miles away, James Clarke looks up at 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 inherited the 150-year-old business last year, complete with horsedrawn drays, mash tuns, spurging pipes, fermenting rooms, grist mill and malt loft.

"If we'd sat here 10 years ago," he says later in Hook Norton's in-house bar, "and you'd said that today 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. Thanks to good management, good beer and probably a degree of luck, Hook Norton survives, but it is one of just 38 regional breweries that do.

In 1900, there were more than 6,000 breweries in the UK. Today, there are just over 500. Thirty-three have closed since 1990, taking more than 130 beer brands with them. As for pubs: 20 close every month. Half of those that remain are in the hands of pub corporations. Rural pubs are disappearing, leaving many villages bereft not just of a place to drink, but of a focus for the community. In towns, giant high-street drinking sheds - known in the trade as "high-volume vertical drinking establishments" - open in their place. The past decade has witnessed an explosion of identikit chains - O'Neill's, All Bar One, the Slug And Lettuce, Wetherspoons - in what critics call a "McDonaldisation" of the traditional pub.

The traditional pub has long been the cornerstone of British culture. 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 quaffing flagons of ale in various taverns. Among 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. He was not alone. Samuel Johnson famously remarked 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". They weren't talking just about the beer (Johnson, in any case, preferred wine - and plenty of it) but the atmosphere that made the pub what it was. The discussions, the games, the drunkenness, the foibles of the landlord, the conviviality, the unpredictable gathering of diverse people; the indefinable something that made every pub different.

Things began going wrong after the second world war. By the 1980s the six largest national brewers owned more than half of the country's pubs and produced 75% of its beer. Brewers lost interest in traditional ale, focusing instead on new nitro-keg beers (pasteurised versions that were cheaper to brew, travelled better and lasted longer) and lagers. Small brewers began to disappear, swallowed up by the "majors". But they pushed things too far, and Margaret Thatcher swooped. The 1989 Beer Orders decreed that no brewer could own more than 2,000 pubs. Furthermore, they'd have to give 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.

Roger Protz, beer writer and leading light in the Campaign for Real Ale (Camra), grins sheepishly when I ask what happened next. "Basically, we were naive," he says. "The Beer Orders said the big brewers couldn't own more than 2,000 pubs, and we thought, 'They'll be happy with that.' But they weren't happy, because they weren't prepared to open up their pubs to other brewers' beers." Instead of selling some pubs and keeping the rest, the big brewers created something new - pub companies - to which they sold all their pubs. And because they didn't brew beer themselves, these companies, known as PubCos, were exempt from the legislation.

"There were a lot of sweetheart deals," says 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 take only our beers.' And that was what happened." Today it is the PubCos that call the shots. In 1989, the six biggest brewers owned around 30,000 pubs. Now, the 10 biggest PubCos own around the same number. Meanwhile, the six biggest brewers own no pubs at all, but produce a higher proportion of beer than they did in the 1980s: eight out of every 10 pints drunk.

Whitelock's, "the last real city centre pub in Leeds", is something of an institution. The 300-year-old tavern has been praised for its atmosphere, its beer and its regional cuisine by the likes of John Betjeman, Peter O'Toole and Keith Waterhouse. Its Yorkshire puddings and jam roly-polies are particularly admired. Or they used to be. That was before the Spirit Group, one of the country's newer breed of PubCos, got hold of Whitelock's. You won't find jam roly-polies or Yorkshire puddings 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 pubs around the country.

The cloning of the Whitelock's menu caused fury in Leeds last summer, when a journalist on the Yorkshire Evening Post got hold of an internal memo sent to the pub's staff. It described two imaginary customers who represented the sort of clientele the PubCo wanted Whitelock's to attract. "Mick" and "Ruth" were colleagues: he was a manager who drove a BMW and drank beer, she an office worker who ate pasta and drank pinot grigio. 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 Spirit wanted to do to Whitelock's what it had already done to the Whip, another traditional local restyled as a hip "Mook" bar, more than 1,400 people signed a petition urging it not to touch "this gem of the north".

"I've got a huge dislike of things corporate," says Karen Jones. This seems a curious statement from the chief executive of Spirit - a £500m company, with 2,400 pubs - who herself founded the Cafe Rouge and Dome chains. "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." Spirit is a centrally controlled operation, which, says Jones, is the way to "make standards as good as we can make them, all the time". It has done away with landlords and replaced them with managers, who take orders directly from head office. "This does not mean imposing "cookie cutter" branding on every pub," she says. But pubs, like any other part of society, change with the times. "The number of people visiting pubs is increasing overall," she says - but only because companies such as hers are changing them to meet new demands: less beer, more wine and, most of all, more food.

For all Jones's confident talk, it may be that the managed chains, applying the techniques of Pizza Express and Cafe Rouge to the traditional pub, have peaked. Soon after I spoke to Jones, rumours began to circulate that her company was a target for takeover bids from other PubCos, including Punch, one of the largest. If Punch succeeds in getting its hands on Spirit's pubs, it will be converting them back into what most of them originally were - tenanted pubs, run by landlords. This is not necessarily cause for celebration - tenanted pubs can be almost as closely controlled and uniform in style as the managed variety.

Meanwhile, out in the country, survival is the 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 the villages in England had no pub. The 7,000 rural pubs that remain are closing at the rate of six a week.

A rural local, run well, can usually make a decent living for its tenants. But for PubCos, decent livings are not enough. Mike Bell's pub, the Portobello Gold, is in west London, but he takes a keen interest in the fate of the rural pub, too. He is founder of Freedom For Pubs, a pressure group formed last year to tackle the "injustices" imposed on landlords by PubCos. "In the case of rural pubs, it's simple," he says. "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 is pub closures. Those that survive often do so by joining the new wave of "gastro pubs" - essentially rural restaurants with bars attached.

According to Bell, landlords in town and country face a common enemy: PubCo greed. "The problem is what's called the 'beer tie'," he says. "I pay rent to Enterprise Inns, the PubCo that 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 is having none of it. As customer services director of Punch Taverns, owner of 8,400 pubs, he argues, "It's not in our interests to make life difficult for our tenants. 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 a pub as a free house, it will cost 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 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. 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 . . . I'm paying rent of about £26,000 a year and it's about to be raised again by another £5,000 or so. Punch says - and 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."

On the table between us sits a folder of documents. From it, Hall pulls a newspaper clipping from early 2004, detailing how Punch's 37-year-old chief executive, Giles Thorley, pocketed £3.6m from selling some of his shares. In total, says the article, Thorley is estimated to be worth around £20m. "Look at this," says Hall. "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."

Brian Jacobs, an accountant with decades of experience analysing the pub trade, explains the mechanism. "Managed pubs work if they are pretty much guaranteed to make good money. If not, the company takes a hit. Property prices are now falling, we have an imminent smoking ban that will hit trade and fewer people are drinking anyway. Under such circumstances, tenanted pubs are a better bet for a PubCo. Once a landlord takes a lease, the risk is on his shoulders and the PubCo gets a guaranteed income in the form of his rents." Even so, Jacobs predicts big trouble ahead for the industry, because the declared value on their pubs is so much higher than the true market value.

It may be, then, that the dominance of the PubCos, like that of the brewers before them, will not last. But in the meantime, when the rough edges and the sheer bloody-minded localness of the traditional pub meet the brands, concepts, share prices and management techniques of modern corporate culture, it's not hard to work out which will triumph.

The Guardian, 2005