Addressing the Business, Innovation and Skills Committee (BISC), Simmonds said version six of the Industry Code of Practice, introduced in February, had brought “meaningful changes – both culturally and commercially” to the fortunes of lessees and tenants.
Responding to the government’s view that the reform of self-regulation was not sufficiently far-reaching, Simmonds conceded that the industry “has had problems, particularly on the leased-side, in the ways pubs operate”.
However, she added: “With version six, I think we have made significant progress.”
Committee member Brian Binley asked why the Code had still not been fully implemented, nearly three years after the original report that declared self-regulation would be operational within 12 months.
Simmonds said: “BIS and the government made it absolutely clear that they wanted it to be right, and they didn’t want it to be rushed."
The pair clashed over the legal status of the current Industry Code. Simmonds said the BBPA had taken opinion from both a Queen’s Council and BIS lawyers that the code was legally binding, but Binley maintained it remained voluntary.
He said: “You put a bundle of lawyers together, and they’ll all disagree. We clearly have different views in this respect.”
Meanwhile, Simmonds reaffirmed the BBPA’s belief that statutory regulation should only apply to the six pubcos that have 500 or more leased or tenanted pubs.
“The reason why we don’t believe managed estates should apply is that it means that companies like JD Wetherspoon – which only operates managed pubs – will be paying for an adjudicator they would never use.”
However, she dismissed the suggestion that the 500-pub threshold arrangement could be abused by pubcos splitting into smaller companies as a “theoretical question”.
“It’s more likely that some pubs will become managed. But I think that has to be the decision of the individual pub company as to how they run their business.”
“As we've said before, the big companies would accept the code and they would accept the 500 number – as long as it doesn’t distort competition.”