Pub companies: follow-up - Business, Innovation and Skills Committee Contents

Supplementary memorandum from BBPA


  It has been brought to my attention that my response to a question from Mr Clapham has been considered to be misleading. I am therefore happy to offer my apology to you and members of the Committee. I certainly had no intention of being misleading.

  Mr Clapham asked me whether I thought the PIRRS website had been removed as a result of "pressure being exerted" and my response was intended to inform the Committee that this was certainly not the case. Whilst I was aware that there had been some difficulty with the website, I was not fully aware of the whole sequence of events. I hope I can now provide clarity.

  The PIRRS website was not removed and it remained in place whilst the difficulty was resolved. The only feature of the website that was removed was the list of valuers and this was taken off-line when it was discovered that not all of the valuers, who had been placed on the list, had complied fully with the requirement to list any conflict of interest. This was confirmed by Mr Karl Harrison in his evidence (Q.185) which stated that he had raised a complaint with Mr Neil Robertson of the BII who then addressed the problem.

  I do believe that such teething problems are almost inevitable in any new venture and my use of the term "a technical problem" was only meant to convey the fact that the problem did not affect the operation of the scheme. The scheme is of course now fully functional and able to resolve difficult rent review disputes that otherwise might not be resolved amicably in a cost-effective manner.

  I trust that this provides a clearer explanation of the matter and may I repeat once again my fullest apology if my response was misleading.


  May I also take this opportunity to clarify the BBPA's position with regard to benchmarking.

  As you will know the industry framework Code requires companies to advise prospective tenants/lessees about the availability of benchmarking studies (including the ALMR study). At the time of the BIS Committee inquiry, the BBPA did not consider the ALMR benchmarking study to be properly representative, as it collected data from only managed pubs and also from clubs and wine bars, which while perhaps useful as comparators, did not provide information of much use to traditional tenants or leaseholders.

  The ALMR has recognised the limitations of its current survey and we are in discussions with them and others as to how to make the benchmark more representative and useful to the industry as a whole.

  When Alistair Darby and I were answering questions at the Select Committee hearing on 8 December, we were looking at benchmarking which will help the RICS to establish guidance in the setting of FMT. For this to work we would need information from tenanted and leased pubs to reflect the average costs of running these pubs which will inevitably have different cost centres to those of managed pubs and other licensed premises. We need to consider how we might canvass for and collect data from the tenanted/leased sector and whether or not such data is indeed collectable or reliable.

  BBPA will be meeting with RICS later this month and the issue of benchmarking will be on the agenda. We are also continuing discussions with the ALMR. We are more than willing to make progress on this once we have a chance to examine the best and most practical way to do this in a cost effective manner.

  We believe that the complexities of benchmarking within the pub sector have been under estimated: this is an issue that cannot be resolved hastily without wider consideration.

  I hope this is useful.

15 January 2010

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