“Aforgotten scandal” – that was Scottish Licensed Trade Association (SLTA) chief executive Paul Waterson’s blunt description on the abject failure of the Licensing (Scotland) Act 2005 to stop maverick members’ clubs operating in competition with pubs.
While it’s important to recognise that many members’ clubs are well-run and operate responsibly – and with whom the SLTA has absolutely no issue – Waterson’s verdict is hard to fault.
For over 100 years the regulation of private clubs proceeded on the principle that all of the club’s property – including the liquor stock – belonged to the members collectively, so that when a member obtained alcohol there was a “supply” and not a “sale”.
But when the Nicholson Committee came to consider the overhaul of licensing legislation, not surprisingly, it came to the view that this analysis was pretty much artificial.
In fact, the time had come at last to bring clubs out of the jurisdiction of the sheriff court and within the general licensing system, subjecting them to exactly the same supervision as all other licensed premises.
The implementation of that recommendation was both a fudge and a drafting disaster.
Provided that clubs meet certain criteria (“qualifying clubs”), they enjoy a number of privileges: a substantially reduced annual fee liability, no requirement to have a premises manager, no need for alcohol sales to be authorised by a personal licence holder (although staff must be trained) and an ability to apply for occasional licences in respect of their own premises.
But while qualifying clubs must have a written constitution with a mandatory content, it’s virtually impossible for a licensing board to apply a sanction where a club is in breach of its rules. That’s the gaping hole in the 2005 Act, allowing clubs to operate on a commercial basis more or less with impunity.
Ironically, there was no such flaw in the Licensing (Scotland) Act 1976. It provided 19 grounds for refusing to renew a certificate of registration and for its cancellation, including, crucially, the grounds that the club’s rules had been “habitually broken” and persons who were not members of the club had been habitually admitted to its premises “merely for the purpose of obtaining alcoholic liquor”.
Yet, the Scottish Government has expressly disowned responsibility for dealing with clubs’ exploitation of this fundamental flaw. Around three years ago, a spokesperson told SLLP (Scottish Licensing Law and Practice): “While we are aware of issues of alleged abuse [of clubs’ special status], it is a matter for local licensing boards to address these issues.”
But as one board clerk told me, it’s totally hopeless to expect boards to take action if they don’t have the appropriate powers.
The government did consult on the better regulation of clubs before publishing the Air Weapons and Licensing Bill, but no corrective provisions were brought forward.
That might just be about to change.
During a number of Bill ‘evidence sessions’, the parliament’s Local Government and Regeneration Committee (LGRC) heard that some clubs were operating commercially by allowing entry to non-members and operating in head-to-head competition with local pubs. Submissions from one licensing standards team emphasised that conduct of this nature didn’t provide grounds for a premises licence review.
There was general agreement that the ‘fix’ was simple: make a club’s constitution part of the operating plan so that compliance became a condition of the licence – broadly equivalent to a reinstatement of the effective control mechanism provided by the 1976 Act.
In its stage one report on the Bill published last week, the LGRC made it plain that it wasn’t appropriate to let the matter rest: “The Scottish Government requires to satisfy us the existing legislation is adequate to prevent the abuses of club licences identified during our evidence sessions. Failing which we recommend appropriate provision is made to incorporate the club’s constitution into the main operating plan.”
But while such a provision would pose no threat to clubs operating within the spirit of the legislation, putting the ‘scandal’ back on the agenda would mark a significant government u-turn.