Grocers didn’t need business rates cut, says JD Sports boss
THE boss of JD Sports has heavily criticised ministers for handing a business rates cut to supermarkets and other stores which stayed open during lockdown, saying the cash should have been used to cut retail rents instead.
Peter Cowgill took a swipe at grocers because he said they “have had the benefit of higher turnover and higher margin” due to panic buying, while also getting rates relief as part of emergency measures to prevent economic collapse.
Supermarkets were among chains deemed essential and allowed to continue operating when Britain shut down at the height of the pandemic, but still saved millions of pounds from the high street-wide tax break, with a £532m boost for Tesco alone.
Meanwhile, retail landlords are struggling because many tenants have been unable to afford rent. With no state support, these property owners are pushing occupiers to pay up.
Mr Cowgill has been on a rent renegotiation crusade for his shops after JD Sports was forced to shut almost all of its stores around the world due to lockdowns, losing out on sales.
Shopping centre owner Intu has already tumbled into administration after running out of money, and a swathe of weaker tenants have renegotiated their bills. The retail chief, who has run
JD Sports since 2004, said that some of the rate relief cash could have been diverted to commercial landlords.
Mr Cowgill, the executive chairman, said: “That money could have been used for the vast majority of landlords, who could then realign their rents for their tenants. As a representative of the stronger retailers who attract footfall, I’m tired of sitting next door to occupants who are paying 30-40pc less for the same box because they have a lease break or an expiry, or have gone through an insolvency process.
“There has to be a realignment. Stronger tenants shouldn’t be subsidising the weaker tenants.”
The FTSE 100 retailer, which began reopening its stores in some countries in April, cancelled its final dividend despite reporting a 3pc rise in pre-tax profit to £348.5m for the year to the end of February. Shares edged down 6.2p to end at 668.4p.
Peter Cowgill, the executive chairman of JD Sports, was forced to shut nearly all the firm’s stores