Statutory code: What happens next?

The Government has chosen to introduce the statutory code as part of the Small Business, Enterprise and Employment Bill and is aiming to get Royal Assent before the end of March 2015. That will set out a duty to introduce a code which would then go out for consultation before needing secondary legislation to be approved.

This means that the exact wording of the code will almost certainly be down to the next Government, which has given the campaigners cause for optimism.

Responding to the Government’s announcement, Fair Deal For Your Local co-ordinator Greg Mulholland said it meant “the reform needed is now within reach”.

He said: “It is vital Government goes further and makes the free-of-tie option mandatory.”

Mulholland, who was on a charity trek in Ecuador when the announcement broke, was unable to respond to the PMA’s questions on whether he would be tabling an amendment to the upcoming bill demanding a mandatory market rent only option (MRO) is included or whether he would wait for the later consultation.

Opposition​

Labour have already stated their support for MRO and both Adrian Bailey, chair of the Business, Skills and Innovation Committee and Toby Perkins, shadow small business minister last week reiterated calls for the Government to go further.

Perkins said he was unsure what the Government’s promise of parallel rent assessments would actually deliver.

He said: “We are pleased that the Government has now accepted many of the arguments that they have been voting against in three Commons votes, however we fear that the watered down version the government appear to be offering will not affect the changes that can prevent the large increase in pub closures we have seen in the last year.

“We will assist the government to get a statutory code on to the statute book as quickly as possible and work to ensure that it safeguards the future of the industry by delivering the real change publicans have been calling for.”

Bailey told the PMA: ““The Labour party has committed itself to introducing a free-of-tie and market-rent-only option. I would expect our front bench to make such a commitment for the next general election.”

Self-regulation​

The Government’s plans cast doubt on the future of The Pubs Independent Rent Review Scheme (PIRRS) and Pubs Independent Conciliation and Arbitration Service (PICAS).

The Government said it could see “the merit in tenants having a choice of arbitration mechanism but whether PIRRS and PICAS do continue is essentially a question for the industry.”

Last week’s report also said the code would provide that tenants “exhaust any in-house dispute resolution procedure before taking a dispute to the adjudicator, although safeguards will be put in place to ensure that such mechanisms are not used to prolong unnecessarily the period before a tenant can refer a complaint to the adjudicator”.