A SOUTHAMPTON landlord is urging pub companies to call time on their huge profits and leave more for licensees.

Dorchester Arms boss Terry Lennon says he might quit the trade because of the high prices he is forced to buy beer at.

He blasted pub companies for forcing landlords to buy beer from them at as much as £30 over open market barrel prices.

The controversial practice is now being investigated by MPs.

The Federation of Small Businesses has submitted evidence to the Trade and Industry Select Committee inquiry suggesting tenants are forced to buy all of their beer at high prices from the pub-cos, which control a third of the market.

A publican for 30 years, Mr Lennon said: "I can buy a keg of beer for £20 or £30 less on the open market."

This means an 11-gallon barrel of Guinness costs him £105 compared to £75 on the free market.

Mr Lennon has a 20-year lease with pub-co Enterprise Inns, which costs him £42,000 annually.

"I am seriously thinking of packing it all in," he said.

Both Enterprise Inns and fellow pub-co Punch Taverns declined to comment until MPs had seen their submissions to the select committee. But it is understood they will argue low rents offered to licensees offset the higher drink prices.

Peter Smith, chairman of the Licensed Victuallers' Association in Southampton, which represents licensees, said: "Landlords have to keep their profits up, but the pub-cos are not passing on the discounts they get."

Mr Smith added that he hoped the inquiry would result in the companies being ordered to pass on savings to licensees.

Research submitted to the inquiry by the FSB claims that 60 per cent of landlords with a lease from Enterprise or Punch are unlikely to renew their agreement.