PICA-Service report shows self-regulation 'is working'
With the industry still at least two years away from seeing a fully functioning statutory dispute resolution system, Luff maintained that conciliation service PICAS remained the only credible mechanism to tackle issues in the landlord-tenant relationship.
Luff said it was vital that the industry continued to support the service, and he would “hold feet to the fire” whenever necessary to prove that it was working.
Speaking to a group of senior tenanted pubco executives last week, he said: “Public recognition of the success of self-regulatory mechanisms, even at this late hour, is important for two reasons.
“First, it will shape the attitudes of those developing and implementing the statutory code. Positive perceptions can only help everyone involved. Second, until the statutory code is in place, the PGB offers the only mechanisms that can build confidence in your sector and resolve disputes effectively.”
Criticised
PICAS was established in 2012 with the aim of providing an independent low-cost dispute resolution service to the licensed industry. It was set up as part of
a deal between the industry and government in the wake of the highly critical report by the Business, Innovation & Skills Committee into pubco relations with their tenants.
PICA-Service annual report
PICAS has, to date, conducted 12 hearings of which 10 found in favour of the tenant complainants with two unsuccessful. It awarded damages in nine cases and instructed remedial works to be carried out in a further case.
Four awards were in respect of findings concerning rent review issues, and six in respect of a lack of communication between the pubco and its tenant.
The number of ‘live’ cases between March 2013 and February 2014 was 13 — down from 18 the previous year. This means a formal application has been received requiring action.
Of those cases, the pubcos involved were: Punch (4), Enterprise (4), Greene King (3), Marston’s (1) and Star Pubs & Bars (1).
Its operation has been criticised by tenant representatives, with one licensee, who had gone through the process, dismissing it as a “tokenistic pantomime”.
To date, PICAS has conducted 12 hearings, 10 of which found in favour of the tenant complainant. An analysis of the hearings by the PMA found that at least seven of these tenants have subsequently left their pubs. These include the licensees that visited business minister Jo Swinson in November 2013 to hand over a dossier claiming that self-regulation had failed.
'Success'
But Luff said his impression was that self-regulation “is working” and called on both sides to move forward “for the good of the industry”. He said: “PICAS is working with increasing effectiveness. The relatively small number of hearings in recent months is a mark of success, not failure.”
Self-regulation will continue to play an important role in the future because the family brewers will not be covered by statutory regulation, he added. Its continued success will ensure there is no necessity for any future government to revisit the issue and lower the current 500-pub threshold.
“Indeed, it might even be possible for a future government to see the PGB working successfully for the family brewers and small pubcos and decide to wind up the statutory process,” Luff said.
Earlier this month, Michelle Dwan, president of the Federation of Licensed Victuallers, called for trade support. “PICAS represents a credible and workable start and should not be thrown out with the bathwater of self-regulation,” she said.
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