MY first contact with Sir Philip Green came around two decades ago when he was running a small public company called Amber Day.
I had written a two paragraph story for the Independent newspaper which provoked the retailing tycoon to scream down the phone at me the following day.
“I cut out your article out and put it under my cat’s arse, which is where it firmly belongs,” Sir Philip, then just plain old Philip, bellowed at me, peppering his further comments with plenty of expletives.
I watched and reported with interest as Amber Day failed and Sir Philip retreated from the public company arena and then watched again with admiration as the retailing tycoon built up an incredible empire, including Bhs and Top Shop.
As the years went by Sir Philip joined the top ranks of British business. He tried and failed to take over Marks & Spencer but in doing so he instructed the country’s best advisers, including the top financial relations firm Finsbury and bankers Merrill Lynch. Then, under the Labour administration, this swashbuckling entrepreneur with a no-nonsense approach to management, was knighted.
That he should have been appointed by the government to look at making cuts in public expenditure does not come as a total surprise. Sir Philip’s talents in running his retail empire will no doubt bring some benefits to some areas of government procurement and there will be jobs that he will no doubt be able to dispense with.
What does surprise is Sir Philip’s naive belief that in accepting the job he would not be subjected to questions about his family’s tax arrangements. One might have every sympathy for Sir Philip and others like him, such as Terra Firma’s Guy Hands, who either reside overseas or have family overseas for tax reasons. Such businessmen and countless hedge fund managers and successful City figures are fed up with what they consider to be a punitive tax system.
But it can not have escaped Sir Philip, or the government’s advisers, that in Vince Cable, the coalition has a business secretary who believes in making those who can afford it pay more. As Cable told us over the weekend: “I remain of the general view that British businesspeople should pay their taxes in Britain.”
Sir Philip would no doubt reply that he does pay UK tax, but his wife, who has received a large dividend in the past, lives in Monaco and doesn’t.
In asking Sir Philip about his tax affairs in the context of Cable’s stated position, CityA.M. upset the entrepreneur who has broken off relations. We are not the first newspaper to reach this state of affairs with him and clearly won’t be the last.
But it is a shame the government’s latest appointee feels this way. In private Sir Philip has interesting thoughts on the kind of tax conditions that might allow his family and others to return to the UK, and he could no doubt enrich the debate.
Increasing tax revenue would bring the budget deficit down just as much as cutting expenditure, and if that means reducing the rates of capital gains tax or income tax bands then that discussion needs to take place. Maybe Sir Philip will be calm enough to discuss such issues when he meets Cable on the business secretary’s return from holiday.
Allister Heath is away.