BII: No truncheons, no magic wands
The BII chief responds to calls for the group to become the industry's policeman and develop a wider dispute-resolution service
There has been a fair bit of political interest in the industry recently, to state the obvious. I have been asked to offer you some thoughts on how I read these, and what I think they mean for the British Institute of Innkeeping (BII).
• The Department for Business, Innovation & Skills "owns" the policy for fair running of business. Each department has a select committee, which advises the Government of the day on policy matters. It's up to the Government what it does next. Committee reports are always taken seriously, but not usually adopted wholesale. The committees have a fair degree of choice as to what they look at.
• It's significant that the committee chose the issue of tied pubs, over and above the many other issues it could have looked at. It will be seen as a competently chaired and thorough review by most.
• It's slightly unusual to see such a strong Government response. Obviously the election — and keeping consumer groups like the Campaign for Real Ale (CAMRA) and unions sweet — was a factor. But it will now be hard for Labour, if it gets back in, to ignore it completely. The other political parties have made similar comments, so they are likely to take the committee recommendations seriously too, although with fewer obligations.
• New Governments like to do things, but the next one will have no money, so legislating becomes a popular course of action as it tends to cost other people money, rather than the Government.
• The OFT is also looking at the tie issue, prompted by CAMRA. This is also an advisory process, but Governments are quicker to implement OFT findings. The OFT focuses primarily on consumer issues, asking "do
supply agreements damage the consumer experience?" (choice and prices being paramount).
• John Healey was asked by the Prime Minister to look at what could be done to help with pub closures. He is an experienced middle-ranking minister in the Department of Communities and Local Government. This is the department responsible for local authority planning, and all things community. His reaction, sanctioned across Government, endorses the committee report and seems to go further.
His ability to deliver the extra steps must depend partly upon Labour getting back in, his own new role (if any) and what the legislative programme looks like. Particularly challenging will be planning changes as they are notoriously tricky.
In summary, Luff's report should be taken seriously.
What does that mean for BII?
Let's first remember that BII is here to help the industry develop professionally and serve its members, not the Government! But we have made a deal with our partners, and we will keep it, by delivering BII Benchmarking and Accreditation Services (BIIBAS) code of practice accreditation and monitoring. In 2009 we gave guidance on 122 cases, involving more than 12 companies. We will also continue to offer a dispute resolution service to our members, helping literally hundreds of licensees.
The industry leaders have agreed to develop their practice. They will do this through new individual codes, which we are starting to see coming through. Incidentally, well done to Bateman's Brewery for getting theirs in first. The BIIBAS website will make clear each company's performance against their codes. It will of course only measure what is in the code, and is intended to help licensees and prospective licensees differentiate between potential landlords.
Our hope here is that the process will start to make apparent individual company strengths, unique selling points (USPs) and weaknesses, allowing for more informed choices, and more professional negotiations.
Companies competing on quality, for quality, is where we all want to be. We are open to ideas of what else might be usefully published on the site. I hope this will add weight to the lively ongoing debate as to what best practice for pubcos and tenants looks like.
Practical support
Some smaller companies have worried about the work involved in putting together these code documents. I would offer two reassurances for them. Firstly, we will provide practical support and training.
Secondly, BII is this industry's professional body, not a legally-trained judge or policeman. We will apply our usual impartial and experience-led decisions to any situation we are faced with.
This experience tells us, for example, that five-year tenancies carry a significantly different business risk than 20-year leases, so the accompanying documents and policy need proportionately less detail, weight or gravity.
BII administers the Pubs Independent Rent Review Scheme (PIRRS) on behalf of the PIRRS board (BBPA, FLVA, ALMR, GMV and BII). PIRRS has had over 30 serious enquiries, and the first full cases are underway.
One of Peter Luff's suggestions was that PIRRS be extended to cover dispute resolution. The PIRRS board, together with other groups, will doubtless take a view on this, but the experience from our own member dispute resolution suggests to me that these kinds of discussions are qualitatively different.
But again, BII will play a constructive part in any debate and we are open to ideas on how best to do this. We are also engaging with the RICS on its review of rent-setting guidance.
A good response so far
More generally, we welcome John Healey's focus on improving professionalism in the industry, and we will work diligently with any committee or commission that may
be appointed.
Working with what we have, rather than reinventing the wheel, might provide a speedier result.
BII has led on these initiatives (PIRRS, BIIBAS, dispute resolution) because our members and/or the industry have suggested we do. We ask, in return, for everyone's constructive engagement to help us deliver them as professionally as we can, remembering we neither wave truncheons nor magic wands (at least, not in public).
I am delighted with the response we have been getting so far, from right across the broad spectrum of our industry.
