MPs struck a blow against “rip-off” pub rents and beer prices by defeating the Government over the power of the big pub owners.

An alliance of Liberal Democrat and Conservative rebels, with Labour support, stunned ministers by forcing through an amendment to break restrictions on ‘tied’ pubs.

It would mean landlords would be able to negotiate to pay “market only” rents, instead of paying rates set by either the brewery or ‘pubco’ which owns their building.

And they would be able to buy beer on the open market, rather than from the owner – changes which, campaigners believe, can slow the flood of pub closures.

There have been growing protests over the large companies, those with 500 pubs or more, ramping up beer prices to – it is claimed - 70 per cent higher than independent suppliers.

Among the 40 rebels were Liberal Democrat Ian Swales (Redcar), but Conservatives James Wharton (Stockton South) and Anne McIntosh (Thirsk and Malton) backed the Government.

It was the first time since the 2010 general election that the Government had been defeated on a Bill supported by both Coalition leaderships.

And the defeat raised fresh questions for Michael Gove, the former Education Secretary, who has endured a difficult baptism since being demoted to Conservative Chief Whip.

But Mr Swales said: “This important new clause will, at last, give the tenants of large pub companies a fair deal and to help keep pubs open.

“The Government’s plans for pub company reform don’t address the fundamental issue of excessive beer prices and rents charged by the large pub companies.”

During the debate, leading rebels had urged MPs not to be swayed by a last-gasp Government “phoney compromise” of a review, leading to possible action in two years.

Jo Swinson, the Liberal Democrat business minister, argued for a new Pubs Code initially, to give landlords a “parallel rent assessment” - essentially comparing their current deal with a tie-free option.

But rebel leader Greg Mulholland, also a Lib Dem, said: “No more delays, more reviews, no more excuses, please at last let's solve this problem properly, once and for all.”

He accused the big brewers and pubcos of “scaremongering” when one - Punch Taverns - had told prospective investors that the changes would not adversely affect business.

The changes would be phased in over five years, alongside rent reviews, lease renewals or the sale of a pub - or after price hikes, or when a cheaper pub opens nearby.

According to the Campaign for Real Ale, 31 pubs are closing every week across the country, up from 28 every week a year ago.