JD WETHERSPOON chairman and founder Tim Martin has criticised the British Government's plans to introduce a living wage, claiming the new rate will unfairly affect pubs, where staff costs already amount to 75p for every pint pulled.
The new measure, Martin believes, would result in a widening of “the financial disparity between pubs and supermarkets”, and “threaten the future of many more pubs”.
"This disadvantage is compounded by a huge VAT and business rates disparity between pubs and supermarkets, which is putting unsustainable pressure on many pubs in our industry, especially in smaller towns and less-affluent areas," said Martin, who was brought up in Belfast and New Zealand.
Most publicans are negative about Chancellor George Osborne’s plan to introduce the mandatory pay rate of £7.20 an hour from next April.
Many believe this will be the final straw for pubs, already hit by cheap alcohol prices at the supermarket, the smoking ban and increasingly stiffer drink-driving laws.
The chancellor's new measure could mean, publicans believe, that older, more experienced bar staff — who are often paid above the “national living wage” — are driven out as pubs are forced to cut down on the number of employees. In order to meet their wage bill, pubs will have to favour younger, inexperienced staff.
Mr Martin believes that the British chancellor is wrong in his new proposal. "Pubs contribute around 40 per cent of sales as taxes of one kind or another and are important generators of jobs.” He added that his company had already increased starting pay levels last October and had agreed an 8 per cent rise from this August.
Martin told ProActive Investors that Wetherspoon’s annual profit was unlikely to top last year's.
Mr Martin attended Belfast’s prestigious public school Campbell College. He famously named his pub chain after a New Zealand schoolteacher who told him that he’d never amount to anything.