Peter Bradley of campaign group Licensees Supporting Licensees was speaking at the Business, Innovation and Skills Select Committee scrutiny into the Government's proposed statutory code on the relationship between pub companies and their tenants.
Bradley, who is an Enterprise Inns tenant, said: "From the perspective of the licensees that I represent, a lot of them initially did not know about the service. In some cases, it has been announced that the (voluntary) code hasn't been binding, so there's a situation of tenants thinking, 'what's the point? We're going to fight this and put a lot of time into it'.
"It is a low cost way of taking a complaint forward but they have to have confidence that the outcome is going to be enforced. If there is confidence in the process, I think tenants will be far more willing to use it."
Simon Clarke of the Independent Pub Confederation added: "PICAS itself can't deal with legal issues. If I had an issue with a contract being unfair, it's not actually in the gift of PICAS to deal with that. If they could, then its only sanction would be a penalty and what we need there is someone with some powers, I'm hoping the adjudicator, to render unfair contract terms unenforceable."
Meanwhile, Kate Nicholls, strategic affairs director at the Association of Licensed Multiple Retailers, said that the Government must make sure that rent assessments are carried out fairly.
"From an ALMR perspective, we believe it's the regulation of the rent assessment process," she said. "We would never have got into the problems that we are in now if there were not over inflated projected rents. That produces disparity in what you think you're going to earn and what you are actually going to earn.
"You have got to tightly regulate the rent review process at any time, not just at the initial rent. The tenant should be equipped with the best information to go into a genuine commercial negotiation."