The Home Office confirmed it had given in to opposition from the drinks industry and ditched the so-called blanket banning orders.

Other proposals set to be dropped include giving councils the powers to ban happy hours. Pubs would be unable to serve alcohol in glass containers during peak times and all licensees would have to operate a scheme that will ensure drinkers must be over the age of 21 to drink on their premises or to buy alcohol. Retailers, under the proposal, would be unable to offer bulk discounts during "stipulated times."

But the Home Office said the Mandatory Code would still go ahead. It is set to include a nine-point mandatory element applicable to the on-and-off-trade but the content still remains unclear.

A Home Office spokeswoman said: "We are listening and responding to the strong concerns from the licensed trade who are concerned about responsible premises being caught up with the less responsible ones. 

"The locally applied conditions in the Mandatory Code will be replaced by new, tougher powers for local councillors and licensing officers making it quicker and easier for them to tackle problem premises by calling for a review to restrict or remove their licence without having to wait for the police or local residents to complain"

Councillor Chris White, chair of the Local Government
Association's culture, sport and tourism board, said: "There is no doubt that
councils with city centres blighted by drunks picking fights or people being
taken ill on the streets need to be able to act against premises selling
alcohol in irresponsible ways.

"Councils have been arguing for more powers that they can
use to tackle problems with alcohol locally but applying ‘discretionary powers'
would have been too difficult for them to implement.

"We welcome giving councils and MPs the power to instigate reviews
as and when they see fit."

Drink trade bodies the British Beer and Pub Association and the Wine and Spirit Trade Association have criticised the mandatory code but welcome the removal of the discretionary powers.

A spokesman for the WSTA said: "We've always warned that the
mandatory code threatened to add an unnecessary raft of rules and regulations,
a view shared by police and local enforcement agencies during consultation, so
we would welcome any move by government that responds to those concerns and
focuses action on problem drinkers and premises, not the responsible majority."

The Bill will be debated in the House of Lords on Tuesday
October 20 and is expected to be implemented in early 2010.