On-trade

Government liberalisation of licences will lead to glut of pubs in urban areas

Government’s proposal will in turn see more rural pubs die off
Annabel's the Garden Terrace

The LVA is greatly concerned that the change to the ‘extinguishment requirement’ will see the number of pubs in Ireland soar over the coming years.

The Licensed Vintners Association (LVA) has said that the Government’s decision to effectively liberalise the pub market from 2026 will eventually “see pubs on every corner in major towns and cities”. They also note that the Government’s proposal to allow anyone to apply for a pub licence will see more rural pubs “die off”, as the value of many of these premises will evaporate overnight.

These changes are contained in the Government’s proposed Sale of Alcohol Bill, which the LVA will discuss with the Joint Oireachtas Committee on Justice on Tuesday.  Although the LVA supports many of the measures outlined in the legislation, there are greatly concerned the change to the ‘extinguishment requirement’ will see the number of pubs in Ireland soar over the coming years.

The licensing regime exists to provide for regulatory control on the sale of alcohol, not to protect publicans from competition. With  6,800 pub licences in the Republic of Ireland there is a pub for every 738 people in this country, compared with one pub for every 1,415 people in the UK’s liberalised market. On top of this, in this country there are another 2,250 wine on-licences (restaurants), 514 special restaurant licences, over 1,000 hotel licences and 3,450 off – licences.

Some 1,800 pubs have closed their doors in the Republic of Ireland since 2005 (approximately 21% of the market), which the LVA says is an indication that the country is already “over-pubbed”.

Up to now the ‘extinguishment requirement’ has meant that anyone who wishes to open a new pub or off-licence must first purchase a licence from an existing outlet. Those licences could then be transferred to another location in any part of the country.

Rural pubs

For small pubs in more rural locations, this was one of the few measures that ensured their pubs retained value and were an asset to their livelihoods. However the LVA has warned that if the Government’s plan to scrap this process is adopted, they will effectively be wiping out the value of thousands of rural pubs overnight. It will result in more rural pubs dying off.

“While we are are broadly in favour of the Sale of Alcohol Bill and many of the measures it contains, we are greatly concerned about the Government’s proposals to effectively liberalise the pub market,” said Donall O’Keeffe, Chief Executive of the LVA. “This wasn’t something that was needed or that anyone was asking for. Yet if this particular measure proceeds it will see rural pubs further decimated, the livelihood of rural publicans massively threatened while they are still recovering from almost two years of pandemic restrictions and eventually lead to a surge of pubs in major towns and cities. Who wants more pubs in these areas?

“The Government has claimed that this liberalisation is being adopted in order to ensure there are more pubs in rural areas. That’s not what is going to happen. Rural pubs are closing because they don’t have a market. Their customer base is vanishing. New pubs aren’t going to appear in locations that aren’t commercially viable. Any new licences will be for areas where there is a market and that mostly means the urban parts of the country,” Mr. O’Keeffe said.

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