Written evidence submitted by the British
Institute of Innkeeping (BII)
STATUS REPORT, JUNE 2011
1.0 SUMMARY
The current status of three schemes, developed and
operated by the BII is set out below. They are:
— The
BII Business Support Helpline.
— PIRRS,
an expert rent determination scheme administered by BII on behalf
of a cross industry board.
— The
BIIBAS code accreditation and monitoring scheme.
1.1 BII Business Support Helpline
The BII Business Support Helpline is just one of
the support services provided to BII members. Membership comprises
of approximately 33% tied tenants. Section 2 shows the range and
scope of requests for help over the last year.
The scope of the questions is broader than the codes
of practice and allows BII to work with members and, where appropriate,
landlords, to resolve issues. BII receives good co-operation from
landlords.
The scheme predated the 2010 inquiry, but usage subsequently
increased due to a heightened awareness of potential for dispute
resolution and the ongoing economic challenges for tenants/members.
The helpline is funded from membership fees.
1.2 PIRRS
PIRRS, the Pubs Independent Rent Review Scheme, offers
an accessible, low cost rent resolution service. The rent is determined
by a valuer of the tenants/lessees choice from an agreed panel
at a fixed price based on geography and current rent. The scheme
has been required on a relatively few number of occasions. Most
serious disputes have been resolved prior to reaching the final
stages of PIRRS. The availability of the scheme has undoubtedly
been a catalyst for reaching an agreement.
The paperwork associated with the scheme has received
minor updating through the year from evaluation feedback. The
results are not published but anecdotally we are aware these have
been broadly favourable to the tenant.
The board agreed during the year that PIRRS would
now be available for lease/tenancy renewals. Full legal arbitration
or independent expert determination is of course still separately
available depending on the agreement. PIRRS is funded through
a levy on BBPA members. We have received good co-operation with
landlords on PIRRS. Some companies appear to have a policy of
resolving issues prior to PIRRS whilst some prefer to use PIRRS
to settle as a last resort, which is of course what it was designed
for.
Please refer to section 3 for further information.
1.3 BIIBAS
BIIBAS (a separate legal entity from BII, with a
steering and benchmarking committee), has accredited codes against
the industry framework published last year. It subsequently monitors
them through a formal complaint handling process.
We are aware of the committee's interest, and offer
a number of observations to illuminate the report:
— Codes
have been received from 35 BBPA members (+ 1 non BBPA member).
— Codes
have been accredited from 32 BBPA members (+ 1 non BBPA member).
— 27
code complaints have been received.
— The
benchmark for accreditation removal has been set at approx 99%
compliance. No company codes have been withdrawn.
— A number
of queries have concerned codes accredited prior to 2010.
— The
difference between minor and major breaches is where there is
material impact for the tenant.
— Although
a matter of opinion, the standard of "regulation" that
has been achieved has been good. Complaints have been professionally
followed up and handled.
— There
is good co-operation from landlords in our pursuit of complaints.
— All
parts of the industry have contributed to the process. We commend
the contribution of certain individuals who have been, and remain
critics of the tied business model but have nonetheless assisted
with its implementation.
— It
can be seen from running the scheme that there has been significant
operational change for many pub operating companies.
— Complaints
have not been confined to larger companies.
— Similarly,
nine months experience of full implementation has flagged up a
number of areas that the scheme secretariat will be suggesting
the board review, with a view to seeking greater clarity in codes.
These include: tie compliance monitoring, AWP machine income,
debt handling and changeover.
— The
PEAT training has been a particular success, with evidence that
new entrants are asking the right questions and landlords reporting
time increases in concluding lease and tenancy agreements.
— The
BDM qualification has been piloted and will be rolled out from
August. This includes a section specifically on the new codes.
The development timescale for this qualification is normal for
a higher level professional qualification of this type.
— The
BIIBAS scheme was funded this year through redeployment of accreditation
fees charged
Please refer to section 4 for further information.
1.4 Mediation
A number of the issues raised are either: outside
the scope of the codes, come from non BII members, or they might
be particularly intractable and difficult, even though the businesses
are potentially viable.
This has led BII to recently pilot and launch an
informal mediation service aimed at facilitating agreement. Early
results have been encouraging. The scheme relies entirely on the
good will of both landlord and tenant.
Please refer to section 5 for further information.
2.0 BII BUSINESS
SUPPORT HELPLINE
2.1 Overview
In 2009 the BII Business Support Helpline received
154 calls, this rose to 195 in 2010. From January to the end of
May 2011 the helpline has received 94 calls.
2.2 Nature of Cases
The range of subjects discussed through the helpline
is broad, however rent and financial issues dominate.
From January 2011-May 2011 the nature of cases was
as follows:
— 37.6%
of enquiries received from January to May this year related to
rent.
— 14%
were licensees requesting financial or business support.
— 11.8%
were licensees seeking advice on surrender or termination.
— 8.7%
were licensees seeking advice on lease renewal or the terms of
their lease agreement.
— 5.4%
of licensees wanted advice on new agreements.
— 4.4%
related to repairs or dilapidations.
3.0 PIRRS
3.1 PIRRS Overview
| Cases completed through PIRRS
| 7 |
| Cases completed outside PIRRS | 7
|
| Stalled cases—no further correspondence received
| 5 |
| Cases currently open | 8
|
| Serious Enquiries | 8
|
| TOTAL | 27 |
Of the cases currently open:
| Application Stage | 4
|
| Awaiting signed Deed of Variation | 2
|
| Cases handed over to Independent Expert |
2 |
Location of Premises:
| Wessex Region | 4 |
| Southern Region | 4 |
| Central Region | 4 |
| Thames Valley Region | 3
|
| Wales Region | 3 |
| Anglia Region | 2 |
| London | 2 |
| West Midlands Region | 1
|
| South West Region | 1
|
| North West Region | 1
|
| Yorkshire Region | 1 |
| Unknown (enquiry, address not given) | 1
|
Pub Companies:
| Enterprise Inns | 21 |
| Punch Taverns | 3 |
| S&N | 1 |
| Unknown (from stalled cases) | 2
|
3.2 Feedback
Rent review resolutions are confidential and therefore the PIRRS
administration team do not have statistics on the outcome of cases.
Once the PIRRS administration team has been informed that a case
has been resolved, evaluation forms are sent to both tenant and
landlord. Feedback received:
— The
administration for the scheme is efficient and the paperwork is
easy to complete.
— The
PIRRS team are helpful when making enquiries.
— The
Independent Experts are very professional, fair, and thorough
and tenants feel reassured that the Independent Expert would not
be influenced by either party.
— One
tenant is so confident in the scheme that he has offered to be
called upon to offer advice to other tenants considering using
the scheme.
"I have to confess initially I was cynical but
I found the PIRRS process to be totally fair".
"Thank you so much for your assistance in bringing
this matter to a quick and painless conclusion. I am very please
with the outcome".
"Wrong answer but that is always the expert's
prerogative. The lessee was an excellent advocate in his submissions".
4.0 BIIBAS
4.1 Overview
Thirty-three pub operating companies have achieved
BIIBAS accreditation representing 87.1% of the tenanted/leased
estate in the UK.
| % of tenanted/leased estate in the UK*
|
| BBPA members | 82.1
|
| Accredited | 81.1 |
| In process of attaining accreditation | 0.7
|
| Not submitted | 0.3 |
| Non BBPA members | 17.9
|
| Accredited | 6.0 |
| Not accredited | 11.9 |
(*Data sourced from thePublican Industry Report 2010 and pub operating
companies in communication with BIIBAS)
|
4.2 Accreditations
| Pub Operating Company | Date of Accreditation
|
| Admiral Taverns | 10.11.10 |
| Adnams | 16.03.11 |
| Batemans | 01.04.10 |
| Brakspears | 19.08.10 |
| Charles Wells | 30.06.10 |
| Daniel Thwaites | 08.09.10 |
| Elgood and Son | 26.01.11 |
| Enterprise | 30.06.10 |
| Everards | 03.12.10 |
| Frederic Robinsons | 17.01.11
|
| Fullers | 03.06.10 |
| Greene King | 13.06.10 |
| Hall and Woodhouse | 25.10.10
|
| Heavitree* | 07.03.11 |
| Holdens | 02.06.11 |
| Holts | 15.12.10 |
| Hook Norton | 18.05.11 |
| Hydes | 03.12.10 |
| JW Lees | 19.08.10 |
| Marstons | 15.07.10 |
| McMullens | 26.07.10 |
| Mitchells and Butlers | 14.12.10
|
| Mitchells of Lancaster | 03.05.11
|
| Palmers | 14.02.11 |
| Punch | 30.06.10 |
| SA Brains | 20.08.10 |
| Scottish and Newcastle | 22.07.10
|
| Shepherd Neame | 06.08.10 |
| St Austell | 07.01.11 |
| Timothy Taylor | 28.10.10 |
| Wadworth | 09.07.10 |
| Young's | 30.06.10 |
| (*Awaiting final revised version) |
Copies of accredited codes of practice are available on the BIIBAS
website—www.biibas.com
4.3 Code Compliance
BIIBAS has received 27 code of practice complaints that have warranted
full investigation. They range in subject and come from a variety
of different sized companies.
Of the 27 cases:
— Five
complaints related to codes accredited before 2010 (meaning codes
not covered under current arrangements).
— Five
complaints have been upheld.
— Eight
following investigation were recorded as "no breach".
— Nine
remain under active investigation.
As recorded in March, BIIBAS received several allegations
of bad practice particularly involving processes at the commencement
of an agreement. If the new codes had been fully implemented when
these allegations occurred, BIIBAS would, in all likelihood have
recorded code breaches. BIIBAS worked with the licensees, their
representatives and the pub operating companies to resolve the
situations in all of those cases.
The nine active cases are at various stages in the
process and it is therefore inappropriate to discuss the details
at present. However BIIBAS can confirm that all cases involve
larger operators. It remains to be seen whether these cases will
result in upheld breaches.
The following table shows the number of confirmed
code breaches:
| Resolved
| Unresolved
| |
| Pub Operating Company | Minor
| Major | Minor |
Major | Total |
| Enterprise | |
| 1 | | 1 |
| Punch | 3 | |
| | 3 |
| Scottish & Newcastle | 1
| | | | 1
|
| Total | 4 |
| 1 | |
5 |
Enterprise
1. Minor unresolved breach in the treatment of free of tie
machine income not in accordance with the wording of Enterprise's
code. This breach remains unresolved whilst BIIBAS awaits Enterprise's
decision on whether to amend their code in line with practice
or conform to the wording of the code.
Punch
1. Minor breach on a technicality regarding the following
of BIIBAS processes for updating codes. BIIBAS agreed that the
changes made by Punch improved the transparency of their agreement
but should have been notified to BIIBAS prior to their implementation.
BIIBAS is satisfied no licensee has been disadvantaged materially
by this.
2. Minor breach of timescales for rent review process as set
out in code. BIIBAS is satisfied that the process is now progressing
to the satisfaction of both parties.
3. Minor breach of surrender process in failing to acknowledge
a request for surrender. The situation was resolved without BIIBAS
intervention and the tenant was released from their agreement
on a mutually convenient date.
Scottish and Newcastle
1. Minor breach of rent review processes when former internal
company documentation that did not accord with the accredited
code of practice was sent to a licensee in error.
BIIBAS takes a restorative approach in that it focuses on the
needs of the licensee rather than simply satisfying the process
and penalising the pub operating company. BIIBAS engages with
both parties to find solutions and promote resolution. By taking
a restorative approach BIIBAS can look at the underlying relationship
and include issues that are beyond the narrow scope of the code.
Any licensee who feels that their pub operating company has not
adhered to the code of practice should bring a complaint to BIIBAS.
Details of how to contact BIIBAS are set out in every accredited
code.
5.0 MEDIATION
In the last few months BII has acted as mediator in four cases,
resolving issues between licensees and their pub operating companies.
The success of these cases has led the BII to launch a new mediation
service to the trade which will sit alongside the existing services
offered by BIIBAS and PIRRS.
Cases ranged from disputes over discretionary business support
to compensation for inadequate repairs and the associated loss
of business and issues around the termination of a lease.
Iain Jackson, Director of Estates at Marston's Pub Company stated
"In just three hours, BII mediation resolved a disagreement
that had gone on for over a year."
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