Wetherspoon boss: ‘Not up to Burnham’ to choose who is on the high street
Britain’s pubs have few more committed defenders than Sir Tim Martin. The Norwich-born businessman founded JD Wetherspoon in 1979 when he bought his first pub in Muswell Hill, initially named Martin’s Free House.
Since rebranding the pub to Wetherspoon – named after a former teacher of Martin’s who could not control his class – it has expanded into the UK’s best-known pub chain, famed for its rock-bottom prices.
The pub tycoon is used to going out to bat for the hospitality industry, but Martin has now turned his attention to Britain’s vape and gambling shops.
The Wetherspoon chairman says they are being made the undeserving scapegoats of Andy Burnham’s plans to rejuvenate British high streets.
In one of his first moves after entering Downing Street, the Prime Minister introduced a business rates cut for pubs, bars and music venues, and has in turn pledged to crack down on vape shops, gambling centres and other “rogue operators”.
“I think it’s not up to the Prime Minister, or the leader of the opposition, to say what shops should be in high streets,” Martin tells Morning Wire. “In my view, if there’s demand for vape shops, and there are no other takers, then there’s no point in criticising vape shops.
“A huge number of people vape, it’s legal, and they’re paying rent and rates, and they’re employing people. […] Vape shops and betting shops are legal businesses, and there’s no point in demoralising people who run legal businesses.”
‘Pointless’ to crack down on vape shops
Speaking to Morning Wire from Wetherspoon’s Watford headquarters, Martin says he agrees with Mike Ashley, the Frasers Group owner and retail tycoon who has attacked the Prime Minister for his “populist” high street policies.
Burnham’s crackdown on vape and gambling shops is a pursuit of “good media soundbites” rather than an attempt to “address the real underlying issues of how the country’s financial affairs are managed,” Ashley told the Prime Minister.
“I’m not a vaper,” Martin says. “I’m an ex-smoker, but so long as there are vapers and smokers in the land, and it’s not illegal, it’s pointless to suggest that high streets would be better off without those transactions taking place in the town centre.”
This week, the government set out plans to hand mayors the power to impose uncapped taxes on tourists’ accommodation fees. The move provoked an immediate backlash from hospitality leaders, who said the levy will add to the “significant tax burden” already facing the industry.
Martin said he is concerned that this new tax will hammer hospitality firms further. “The UK has become a heavily taxed economy. If it’s a tax and it removes money from the public by meaning they have to pay more, I’m against it. I think we’ve had a lot of tax increases in recent years, and we don’t need any more.
Beyond business rates and the tourist tax, pub sector leaders have said they are contending with a litany of costs, worsened by government tax hikes in recent years. Higher employer national insurance contributions, above-inflation minimum wage rises and surging supply chain costs caused by the Iran war all mean pubs make meagre profits from the sale of a pint, they say.
Pub sector ‘infinitely more difficult’
Martin believes Burnham should take real action to boost local communities by helping pubs to compete with supermarkets, which he says have taken half of the beer trade away from pubs since he started out in the sector.
“If you want pubs to do well in the future, the big disparity is VAT [value added tax]. We realise that the government would lose money if it stopped VAT on food in pubs, but I think it needs to rebalance taxes between pubs and supermarkets so that they’re approximately the same. Now they’re much higher in pubs,” he says.
Next Thursday, Wetherspoon will cut the price of all of its food and drink by 7.5 per cent in a bid to illustrate the savings that the pub chain could pass on to its punters if the government handed the industry a tax break.
Martin has backed a campaign, spearheaded by celebrity chef Tom Kerridge, for the VAT rate for hospitality to be cut from 20 to 10 per cent. But the initiative has faced accusations that the industry’s largest operators would absorb these savings rather than passing them on to customers.
Martin says the trading conditions facing the pub sector are “infinitely more difficult now,” compared to when he set up the company nearly half a century ago.
He says he would think twice about setting up a pub company today. “I think it’s quite important the type of business you get involved in, and with hindsight, maybe you wouldn’t go into a business whose main product has lost over half [of] its volumes to supermarkets.”