How did Mr Cameron’s favourite plumber get so flush (clue: don’t ask him about his tax affairs!)
WITH his inspiring backstory and charismatic persona, Charlie Mullins — the chirpy Cockney who rose to build Britain’s most high-profile plumbing company — is the type of entrepreneur that Tory politicians drool over.
Not only do David Cameron and George Osborne seek his advice on business matters, he is also a valued Tory Party benefactor who contributed £22,350 last year, paying for display stands at the annual conference and bidding generously at fund-raising auctions.
So earlier this month, when the 63-year-old boss of Pimlico Plumbers hosted a table at the Conservatives’ glittering Black and White ball, his blond-streaked hair spiked, Rod Stewart-style, and a glamorous new girlfriend on his arm, many of the party’s big beasts were happy to be photographed alongside him.
A shameless publicity junkie who wastes no opportunity to promote himself and his company, Mr Mullins — who describes himself as the ‘plumber to the stars’ and boasts the likes of Richard Branson, Helen Mirren and Joan Collins among his clientele — was equally keen to flaunt the pictures, and duly posted them on his blog.
One shows the recently divorced Mr Mullins and his partner Julie Anne Morris (a 45-year- old cleaning company director, who looks remarkably like a younger version of his 61-year- old ex-wife, Lynda) posing with the smiling Prime Minister. Others capture him shaking hands with Boris Johnson, and standing grandly alongside Iain Duncan Smith and Priti Patel, the Employment Minister.
The images were quickly reproduced in national newspapers and websites.
We can well imagine the embarrassment in senior Tory ranks, then, when just 12 days after the ball Charlie Mullins was the subject of a lurid article in The Times — a story which made him reconsider his oft-repeated adage that there isn’t such a thing as bad publicity.
Headlined Flamboyant Tory Donor Avoids Tax On Workers, it revealed how he avoids paying millions in National Insurance contributions by hiring his ‘posh plumbers’ as self- employed contractors rather than members of staff. It also means he doesn’t have to pay them when they fall sick or take holidays.
This is despite the fact that Mr Mullins, whose ex-wife is said to have received a £12 million settlement when their 40-year marriage ended and owns 5 per cent of Pimlico Plumbers, is a strident critic of those who fail to pay their dues, leaving others to shoulder the burden.
He also goes to great lengths to promote the corporate image of Pimlico Plumbers, proudly referring to his ‘ workforce’ and insisting in his ‘bible’ of rules that they must wear identical uniforms (blue with a dash of red) and drive vans bearing the smart blue company livery.
Since his 200-strong army of Mr Fixits repair the loos and boilers in some of London’s finest addresses, ponytails, tattoos, facial piercing and smoking on the job are also strictly taboo — though the ban on beards has been relaxed.
As a leading employment QC told me this week, all this enhances the impression that by paying handsomely for the services of a Pimlico Plumber (whose average weekday call-out fee is £180 an hour, split equally with the company), customers are not hiring some self-employed freelance but the complete company man.
Given that Mr Osborne has declared war on businesses ‘ who disguise employment as self-employment and thus avoid employment taxes and deny employment rights to their workforce’, the exposé was a PR disaster — for the Tories and for their favourite plumber.
This week, however, the saga has taken a rather intriguing twist.
On the surface, the fact that Mr Mullins operates his business in this dubious though perfectly legal manner came to light quite routinely, following an employment tribunal case brought by a plumber who claimed Pimlico Plumbers denied him employees’ rights after he suffered a heart attack.
Gary Smith, 47, from Dartford, Kent, argued that he ought to have been allowed to work a three- day week, as doctors had recommended, but the company insisted he must do five days — then dismissed him when he refused.
However, if we believe Mr Mullins, the suggestion that he is a ‘ taxdodger’ and his firm is a drain on the public purse carries no substance.
He claims darkly that he has been ‘smeared’ because he is a prominent and vociferous supporter of Cameron’s campaign to keep Britain in Europe.
Of course, many will find the notion that Charlie Mullins is the victim of some sinister ‘Plumbergate’ plot quite extraordinary. Such is his determination to prove his theory, however, that this week he invited me to hear him out.
Visiting the firm, which Mr Mullins founded as a jobbing trader more than 45 years ago and has built into an empire estimated to be worth £75 million, is not like dropping into your bog-standard plumber’s yard. There are no clapped- out vans, no stacks of U- bends and rusting wrenches.
THE immaculately swept garage is filled with identical vans, each bearing some quirky number-plate, such as DRAIN, S11OWER and SINKS. Parked beside them is the boss’s £340,000 Bentley Mulsanne.
Outside the canteen, there is a lifesized caricatured sculpture of Prince Charles reclining in a bubble-bath, wearing a golden crown. Not in the best taste, perhaps, given Mr Mullins’ involvement with the Prince’s Trust and his recently awarded OBE.
The reception area resembles a West End theatre foyer, with newspaper articles and signed photos of the company’s clients adorning the walls: Britt Ekland, Eric Clapton, and Graham Norton to name but a few.
Oh, and there’s the late Michael Winner. He was an eccentric old cove, remarks Mr Mullins with a chuckle.
Winner had almost ripped the head off one poor plumber for having the effrontery to arrive for a job ten minutes early — but then made him tea and toast when he returned exactly at the appointed time.
Upstairs, in Mr Mullins’ office, statuettes of Margaret Thatcher and David Cameron are perched on the fridge, and there are dozens more photographs of him hob-nobbing with the great and the good.
When I ask him whose boilers he has serviced recently, he suddenly leaps up and presses his intercom. ‘Hey, Katie, which famous clients have we had lately?’
His call centre manager reels off a list of names, among them pop stars Noel Gallagher and Ed Sheeran ( who was breakfasting with One Direction’s Harry Styles when the plumber came to call), Eddie Izzard, ITN newscaster Mark Austin, Andrew Lloyd Webber, Hugh Grant and — his personal favourite — Joanna Lumley.
But back to the heinous ‘smear campaign’. Mr Mullins begins with a gush of statistics. Pimlico Plumbers employs 340 people (within two years he expects it to be 500) and last year he paid nearly £1 million in corporation tax, plus ‘£700,000 to £800,000’ on his personal income.
It’s true, he concedes, that only about 10 per cent of his staff are employed on PAYE, but his 200 tradesmen are given the choice between being members of staff and self-employed, and the majority take the latter option.
Astonishingly, he says his highestearning plumbers are on £180,000 a year, and the lowest make £90,000.
If the average pay packet falls midway, and they had to pay 13.8 per cent in national insurance as PAYE employees, it means the Exchequer is losing more than £3 million.
BUT Mr Mullins has a rapid riposte to this. Because his men can work far more hours as self- employed contractors, he says, their earnings are much higher than the average plumber’s — meaning they pay more tax.
In any event, he works closely with HM Revenue and Customs ‘ and they’d lock me up if I was doing anything wrong’. And Pimlico Plumbers, he says, is not the only company hiring workers in this way — ‘50 per cent of the industry does it’, including big names such as British Gas.
As to the motive for the story, he says one only need look at its timing. It was published just as leading Tories were poised to declare their backing for Brexit and Cameron was preparing to launch the official Tory ‘Remain’ campaign.
‘To be labelled a tax-dodger was a personal attack on me, and I think the Exit camp are behind it, all because I’m prepared to stand up and give my opinion,’ says the former boxer, anger flashing across his suspiciously unwrinkled face.
‘I just feel that the busy-bodies from Eton and Oxford don’t like the fact that I’ve got a view. But I’m not going to be pushed into a corner by these people, who are just bullies.
‘I’ve not done anything wrong. I’m a South London boy who’s done good. I’m not a crook. I’m not a swindler.’
Mr Mullins continues to present himself as a model employer as I’m shown the company’s new gym and am told how the best employees can win £200 worth of credit at Langan’s (Charlie’s favourite restaurant).
I’m also introduced to a Latvian employee whose command of Russian is coming in handy as the company attempts to win the business of London-based oligarchs.
It’s easy to see why Mr Mullins’ operation impresses Government ministers and A-listers alike.
But then I venture a few miles to Dartford to meet Gary Smith. Like many Pimlico Plumbers tradesmen, this father-of-two had high expectations in 2005 when he left his safe suburban job to join ‘ the Premier League plumbing outfit’.
And for the first few years he loved it. Though his income was diminished by having to pay expenses, including £120 a month to rent a company van (fitted with a tracking device to monitor his movements), he relished working in elegant homes, for stars such as singer Amy Winehouse.
Then, in January 2011, when he suffered a heart attack and spent four days in intensive care, he claims he was treated callously by the company.
Instead of sending a get-well card and giving him ample time to recover, he says they kept asking when he was going to return to work, and saying they needed his van.
After six weeks, and against his doctor’s advice, he succumbed to this pressure and resumed full-time employment. But the stress made him ill again. When he said he could manage only three days, Pimlico
Plumbers sent someone to his house to recover his van.
‘When you work for Pimlico Plumbing, you either do things Charlie’s way or you’re out,’ says Gary.
For almost five years since then, Mr Smith, who says he now works for another company, has been fighting for recognition of his employment rights.
A tribunal decided that he was legally a ‘worker’ and thus protected by employment laws. This ruling was upheld by employment appeal Judge Daniel Serota, who deemed Pimlico Plumbers to have devised a system to avoid the PAYE income tax scheme and employer’s NI contributions.
He said the system was also designed to avoid equality laws and deny workers employment rights.
However, Mr Mullins is not beaten yet. He has taken the case to the Appeal Court and hired a QC for the hearing in May. Mr Smith, whose case is being funded by the Equality and Human Rights Commission and who stands to win a six-figure compensation pay-out if he wins, will also be represented by a leading silk.
The outcome of the case could have huge ramifications for the construction industry. ‘ Pimlico Plumbers is engaging workers under “bogus” self-employment in order to deny workers employment rights and avoid paying NI contributions,’ said a spokesman for the union Unite.
‘This is to be strongly deplored as it means the rest of us having to dig deeper in our pockets to pay for . . . public services. The Government needs to clamp down in the likes of Charlie Mullins.’
Employment lawyer Jolyon Maugham QC said it was ‘surpris- ing’ that a company should be able to say its workers were selfemployed when they wore company uniforms and drove liveried vans.
He described the tax saving as ‘ very, very substantial’ and estimated that such practices across the industry were costing the Exchequer a sum ‘in the high hundreds of millions’.
As for the timing and source of this story, it must be said that it carries the whiff of skulduggery. Mr Smith’s employment appeal has rumbled on for years without being reported in the Press, so why should it suddenly emerge now? Mr Smith’s lawyer, Jacqueline McGuigan from TMP Solicitors, says that this case was first heard in ‘open court’ by the Employment Tribunal in 2012, and then by the Employment Appeal Tribunal in 2013 and 2014.
‘Neither party sought to publicise the case,’ she adds. ‘I can only speculate as to the reasons why this story has only now caught the imagination of the Press, which may or may not be down to Mr Mullins’ close association with the Tory Party and the current debate about EU Referendum, but that should not detract from the real issues in this case which are very important to my client.’
Perhaps so, but one wonders where the Plumbergate scandal might go from here.
Will David Cameron and the Stay-campaign turn a blind eye to their celebrity plumber’s tax-avoiding wheeze — or will they quietly pull the plug on him?