Statutory code: 'tied' and 'tenanted' agreements to be targeted

The plans were announced by business secretary Vince Cable last week and the six-week consultation, expected in the spring, is set to include questions on the future of self-regulation and the Pubs Independent Conciliation and Arbitration Service (PICA-Service).

There was initial confusion over whether the proposed code and adjudicator would cover traditional tenancy agreements, with a press release on the Department for Business, Innovation & Skills (BIS) website saying “the code is expected to apply to all pub companies that own more than 500 tied leases”.

However, the department has since confirmed that “the current thought is that the regulation would apply to the six largest pub companies, with a threshold of 500 tied or tenanted properties. Those companies would be Punch, Enterprise, Marston’s, Greene King, Admiral and Star”.

A spokesperson added: “The consultation will listen to views on what the right definition should be and what the threshold should be, including whether a distinction should be made between leases and tenancies.”

James Staughton, chairman of the Independent Family Brewers of Britain (IFBB), admitted there was confusion over the proposals.

“We are awaiting further clarification on what is being consulted on, and the IFBB is in discussions with the Government over the details,” he said.

BII (British Institute of Innkeeping) chairman Bernard Brindley and industry consultant Phil Dixon have questioned the Government’s threshold of 500 pubs, suggesting that smaller companies still need to be held to account if there is a dispute with their tenants.

Brindley, who also chairs the Pubs Independent Rent Review Scheme (PIRRS) board, which oversees the PICA-Service, said the Government may consider bringing the threshold down to 300 pubs. “That sort of number will bring in a lot of the larger companies and family brewers,” said Brindley. “But who can predict what the Government will come out with?”

He added: “My concern is for the smaller companies. I hope PIRRS and PICA-Service will remain in place for those companies because any pubco with credibility will actually want to be held to account if a licensee feels that they have had any form of injustice against them.”

Meanwhile, Dixon said: “All tenants and lessees should be able to challenge their landlords irrespective of how many pubs they own. Is Mr Cable saying that if you are an Admiral tenant you can make a complaint but if you are a Spirit lessee you can’t because they have only 479 pubs?”

The six named pubcos remained relatively tight-lipped on the issue last week, although Greene King and Punch Taverns both admitted that they were “disappointed” with the Government’s decision.

Consumer affairs minister Jo Swinson is to hold a series of round-table discussions with key industry stakeholders to discuss the forthcoming consultation.