John Caudwell, the billionaire founder of Phones4u, is talking to me from the back of a chauffeur-driven Mercedes people carrier as he travels back from skiing in Switzerland to Monaco.
It’s an unlikely place to hold a telephone interview in a pandemic – particularly for a vociferous Brexiteer who says he would much rather be in Britain, where he has a 15-bedroom mansion in Mayfair and a 50-room Jacobean mansion in Staffordshire.
The 68-year-old tycoon’s explanation is that he got ‘trapped’ in Monaco when Boris Johnson announced the latest UK lockdown because his partner, the Lithuanian former Olympic cyclist Modesta Vzesniauskaite, is too heavily pregnant to fly.
‘Travelling back to the UK would have been an impossibility because my partner is seven months pregnant and can’t travel, so we’ve decided to settle for cycling in the mountains every day and working from here,’ Caudwell says. ‘I’m not complaining about that, it’s not a bad place to be trapped,’ he adds.
Billionaire: Self-made tycoon John Caudwell with his partner Modesta Vzesniauskaite
It’s a far cry from the ‘tough streets of Stoke-on-Trent’, where Caudwell and his brother Brian ‘fought like fury’ to build up Phones4u from scratch. Having started out at age 16 as an apprentice at a Michelin tyre factory, Caudwell is now worth £1.56billion and is known for being one of Britain’s biggest taxpayers.
The Caudwell Group spans property investing to wealth management. Perhaps just as impressively, Caudwell is among a small group of trusted business chiefs advising Prime Minister Boris Johnson and Chancellor Rishi Sunak on how to rebuild Britain when the Covid-19 pandemic subsides.
Caudwell reveals he had a conversation with the Prime Minister before Christmas, then a group call with the Chancellor and other businessmen earlier this month.
He says he ‘didn’t particularly digest’ the other ideas presented on the call because his ambitious plan – involving tax breaks and massive investment in infrastructure, apprenticeships and a renewable energy city to create millions of jobs and boost wealth and GDP – is ‘the only way out of this crisis’.
Now Caudwell has come up with an even more provocative ploy to get Britain back on track: a huge windfall tax on online businesses that have ‘profiteered’ from the lockdown internet shopping boom.
Amazon, major supermarket chains such as Tesco and online gambling firms are in his sights for starters. But he says any firm that has made excessive profits while others are suffering should make ‘a contribution to society’.
‘Look at Amazon, their share price and profits have gone through the roof,’ Caudwell says. ‘I would try to assess the extra profit these companies have made as a result of the pandemic, and then tax that extra profit for one year at an extremely high rate.’ When pushed on how high, he adds: ‘That could be as high as 80 or 90 per cent, possibly.’
A smaller annual online tax could also be introduced ‘to reflect the fact that online retailers have a very low-cost model and can easily price-beat any high street retailer’, he says. ‘We don’t want to stop that [online] model, just moderate it slightly so they contribute more to society.’
If wealthy businesses should put their hand in their pocket to fund the national recovery effort, what about wealthy individuals like Caudwell himself?
He’s anticipated the question: ‘The danger of the way I answer this question is that you say, ‘You would say that, wouldn’t you.’ So, let me tell you first of all I’ve stuck around in the UK [since selling Phones4u for £1.5billion in 2006] to pay £350million of taxes when I could have gone to Monaco.
‘I wouldn’t have stuck around for that if I was against paying taxes. I love Britain. But can we tax our way out of this crisis? Absolutely not. Because the amount we can raise in taxes is next to zero – what we’ve seen endlessly is, if you tax the rich, they move to tax havens like Monaco or Switzerland.
I don’t want Britain to be seen as a pariah,’ he says. ‘We need to make Britain more attractive – give people more tax breaks – to bring them in and create wealth.’
Under the four-stage Caudwell Pandemic Recovery programme presented to the Prime Minister, Caudwell says Britain could be saved from a long-term unemployment crisis by creating between 500,000 and one million high-quality apprenticeships.
He also wants the Government to help build a renewable energy city that would become a Silicon Valley-style hub for the environment. Boris has put Caudwell in touch with Ben Houchen, the mayor of Teesside, who also hopes to create a clean energy hub. The third phase of the plan is committing to billions of pounds of investment in fibre-optic broadband, roads, schools and hospitals.
Finally, he wants Rishi Sunak to encourage foreign investment through tax breaks. Caudwell says Boris is supportive of his ideas, but that the Government is not ‘visionary’ when it comes to the scale of his thinking, which will need ‘upwards of £500billion investment if we are to do it properly’. He adds: ‘[Boris] said, fundamentally, he absolutely agrees with me.
They have applied quite a few of the principles of Caudwell Pandemic Recovery, just not in a sufficiently ambitious way to drag us out of this post-pandemic crisis at sufficient speed.
‘GDP won’t bounce back to pre-pandemic levels until the end of 2022 or even later. So, whatever the Government does there will be huge borrowing, either to finance failure through austerity, or to finance expansion through success. I know which side of the coin I’d rather be on.’
A die-hard Brexiteer, Caudwell says the UK’s exit from the EU is a huge opportunity to invest and it’s now up to Boris to ‘grasp the nettle’. ‘If I were in power, my ambition would be to grow Britain’s GDP beyond anything it ever was before, and to outpace Europe significantly, given we have the advantages of Brexit.’
Caudwell is also a supporter of the Excluded campaign that is fighting on behalf of the three million people who have ‘fallen through the cracks’ of Covid support schemes. He says: ‘I didn’t think the Government would neglect these people. But as I’ve looked into it, I’ve realised there is a complete injustice and it has to be put right.’
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