Yahoo Finance Red tape is wrecking fight against inflation, warns Wetherspoon boss
An obsession with red tape and a move away from “free enterprise” is threatening the UK’s fight against soaring inflation, the boss of JD Wetherspoon has warned.
The pub chain’s chairman Tim Martin said “a lack of understanding” by politicians over how to stimulate the economy by easing regulations for businesses would harm the British economy in the long run.
He added: “In order to bear down on inflation, political parties should encourage free enterprise, rather than a reliance on additional regulations.”
Mr Martin’s comments come as the company’s sales reached their highest ever point over the Easter week. Like-for-like sales across its pubs rose 12.2pc over the three months to April 30.
Wetherspoon now also expects sales for the full year to hit a new record high.
However, the company said trade was “noticeably quiet” during the Coronation weekend, suggesting that shoppers bought their alcohol in supermarkets rather than pubs.
“Sales in the last quarter have continued their positive momentum, although inflation, especially in labour, energy and food costs, remains a more intractable issue,” Mr Martin added.
The Wetherspoon chairman previously criticised Bank of England Governor Andrew Bailey for saying that businesses should be cautious about continuing to raise prices because it could fuel further inflation and give policymakers cause to push up interest rates.
Mr Martin said following this advice literally could be “catastrophic for pubs” at a time when they faced “ferocious” levels of inflation.
“What he’s [Mr Bailey] said is understandable – linking pricing restraint to lower inflation is a fact of life. Like the headmaster saying do your homework,” he said.
“But with input costs so high it may not be realistic…if publicans have high input costs they won’t be able to take a literal approach to the Governor’s words.”
The company is currently selling 30 pubs, having already disposed of 21 during the year to date – netting it almost £5m.
It added it had reduced its debt pile by £67m since the beginning of the pandemic to £738m and was planning to invest £185m in new pubs and freehold reversions.
