Robert Sayles: Why the BISC must look beyond the code

So, a new year begins; quite possibly a highly significant one for the trade.

With pubcos due to give MPs an update on progress and the June 1 deadline looming ever closer, one could be forgiven for thinking we've reached a watershed, a defining moment for the industry.

So, what can we expect during the course of the coming months?

Will the hierarchy finally sit around the table and formulate a strategy to revive the ailing pub trade? Events thus far inspire little in the way of confidence it must be said.

Pubcos appear as reluctant as ever to give ground; focusing instead on the codes of practice, (ably supported in this process by the BII).

Ah yes, the much vaunted code.

Whilst welcome, it does make one wonder why it has taken so long for these codes to see the light of day. After all, this degree of transparency is taken for granted in all other retail sectors; a cursory perusal of any franchise brochure illustrates this all too vividly.

Hardly ground breaking then, is it? For our industry at least, it would appear that it is.

It's also worth pointing out that despite the hype, the legality of the code is by no means assured. After all, an IPC recommendation that the code be "enshrined in the lease" has been steadfastly ignored.

In 2009 the BISC echoed such concerns, noting;

"the BBPA's assertion that Company Codes of Practice will be legally enforceable has yet to be proved... unless the BBPA can prove beyond doubt that the Codes of Practice are legally binding, incorporating the Code into the lease would be the only remaining option."

It should also not be forgotten that the codes are likely to be policed by the very people who compiled them. Doesn't exactly fill one with the warm glow of optimism, does it?

So, let's be clear about this.

After three years of utter carnage, the pubcos have finally produced a self monitoring code of practice; one which could, quite possibly, under certain circumstances have some as yet unspecified form of legal remit. It truly is a quite pitiful response, is it not?

Then again, perhaps we shouldn't be surprised. It is symptomatic of an industry all too accustomed to operating in an environment devoid of regulation, one where self interest has been permitted to prevail for far too long.

Power and control are after all highly addictive drugs; once acquired they become increasingly difficult to live without.

Needless to say, pubcos will dismiss such concerns, preferring instead to talk up the importance of these codes. Expect to hear the term 'benchmarking' used with growing alacrity in the coming months.

Of course, many tenants are quite rightly asking what else the pubcos intend to bring to the table. If you're one of them then I've got some bad news for you; the answer is nothing.

After six years of procrastinating and prevaricating, this it seems is the best they can come up with; the sole 'concession' they are prepared to make.

Are the BISC going to swallow it? One would certainly hope not.

I would ask them to consider the following:

The grievances of tied tenants are well documented. What benefits will these codes bestow upon those desperately trying to keep their nostrils above the waterline?

How will they help redress the very real imbalance in both risk and reward that currently exists in the pubco/tenant relationship?

Will the codes do any of the following?

• Tackle the problem of decreasing footfall.

• Make product pricing more competitive.

• Enable tenants to secure sufficient margin.

• Address the rateable value fiasco which has seen RV on many outlets increase as turnover declines.

• Give tenants greater control over the way they run their business.

• Deal with the disparity between off trade and on trade prices.

• Ensure rents are fair.

• Improve the relationship between pubcos and existing tenants.

• Guarantee tied tenants are no worse off than their FOT counterparts.

• Allow a tenant's wage to be factored into the divisible split.

Of course not, yet these are the issues publicans wish to see addressed. It would appear that our concerns continue to fall on deaf ears.

Rather than adopting a proactive stance and realigning their industry to meet these challenges, pubcos content themselves with asking us to 'adapt'.

I don't see any sign of them 'adapting' their agreements to make them fairer, do you?

Of course not, they're far too preoccupied; ensuring tenants adhere rigidly to a business model that consigns many to a life of poverty.

In their desire to cling to past glories (and profits) they failed to recognise one important fact; societies do not remain static, they constantly evolve.

Consequently, over time, people's leisure habits have changed beyond all recognition. For an increasing number of people we are no longer the 'hub'. In fact, to all intents and purposes, we're surplus to requirements.

Many have quite simply moved on, leaving us it seems, trailing in their wake.

The pubcos didn't see it coming; too busy savouring the heady cocktail of profit and complacency, oblivious to the changes taking place around them. Now the reality has finally dawned, they steadfastly refuse to acknowledge it.

It is apparent to many that the tied business model in its current form is the relic of a bygone era; one we are never likely to again witness. Quite simply, the volumes required to sustain it are no longer there.

Nevertheless the pubco mindset continues to be one of denial; content to cling to the past, loathe to legislate for the future.

Rather than acknowledge the need for change, they merely attempt to delude us into believing the good times will return. Their placatory assurances of imminent 'stability' and 'recovery' fool no one; the statistics leave us in no doubt as to where we are, and more worryingly, where we're heading.

Was it not such complacency that created the situation we now find ourselves in? Have the lessons not been learned?

It would appear not. The on trade is in terminable decline, that much is clear. Plummeting volumes and declining margin; that is the stark reality for many today. There is little to indicate the downward trend won't continue for the foreseeable future.

We are in freefall, heading for an impending calamity. Our only hope is that deeds eventually supersede words, a somewhat unlikely scenario it must be said.

Many publicans are quite literally living 'on the edge', increasingly desperate for self interest to be put to one side. They want our "leaders" to do two things - acknowledge the crisis, and address it. In short, secure the interests of all, not merely the privileged few.

But that's the problem, isn't it? We seek leadership where there is none, fairness and honesty where only self interest prevails. Trust has been supplanted by scepticism, desire by greed.

We are rapidly approaching a pivotal moment for our industry. Decisions made in the coming months will decide the fate of many and shape the long term future of the tied sector.

Will the code of practice be the solution to our problems?

I think we all know the answer to that. The real question of course is does the BISC?