Sports Direct founder attacks Burnham's 'populist' High Street plans

Sports Direct founder Mike Ashley has criticised Prime Minister Andy Burnham's cost of living and retail policies as "populist".

In a letter to Burnham, Ashley accused him of "jumping on 'everyday fixes' or bandwagons" while businesses struggled with the government's "disastrous" business rates policies and higher employment costs.

He also described a proposal to increase business rates on large warehouses in order to help reduce rates for pubs and clubs as "delusional".

A Downing Street spokesperson said Burnham would "build a new economy that backs British business, delivers growth in every postcode and ensures the essentials in life... are affordable again"

Removing the VAT from household electricity bills and reducing business rates for some firms was "just the start", the government spokesperson added.

Burnham has promised to revitalise Britain's "hollowed out" High Streets and to address cost of living concerns by tackling "rip-off Britain" including misleading discounting in shops.

Ashley's Frasers Group was built on buying up struggling brands and undercutting rivals on price. It is still owned by Ashley but now run by his son-in-law Michael Murray.

The business currently owns Sports Direct, Flannels, House of Fraser, Game, Evans Cycles, Slazenger, Jack Wills, and Gieves & Hawkes, and several other retail brands.

Ashley's letter, seen by the BBC and first reported by the Financial Times,, external hits out at the government's strategy.

"Shortsighted or populist reactions to underlying business challenges are not the answer. You have the chance to make a difference or get it horribly wrong," he wrote.

He called on Burnham to use his first Budget, scheduled for 28 October, to lower costs for employers and address business rates.

The government has launched a review of the tax on commercial properties, but in advance of that has already announced that pubs, social clubs and live music venues will get a 20% business rates cut from April.

"If your answer is to tax larger retailers even more, through hiking business rates on retailer-owned or third-party warehouses whilst reducing rates for pubs and clubs, then that is simply delusional," Ashley's letter said.

Burnham previously said before he was prime minister that cuts for pubs, clubs and music venues could be paid for by higher levies on warehouses operated by online firms such as Amazon, and targeting the owners of empty High Street properties.

Ashley built Frasers Group from a single Sports Direct store in Maidenhead in 1982 to a sprawling empire of dozens of brands employing 30,000 people.

The billionaire has frequently attracted controversy from investors and the media with accusations over the years of building success by exploiting workers.

In 2016, Ashley admitted to MPs that workers at his Derbyshire warehouse had been paid below the minimum wage and a policy of fining staff for being late was unacceptable.

The business this month bought luxury department store Harvey Nichols and promised a "significant restructuring" of the business.

In his letter to Burnham he asks: "My challenge to you is – how are you going to help with turning Harvey Nichols around?"

He also raises the issue of retail theft which he said cost Frasers Group approximately £40m a year.

Frasers Group has also been increasing its stake in menswear retailer Hugo Boss after its initial takeover bid for the German company was rejected.

Mike Ashley's Frasers offers £1.73bn to buy all of Hugo Boss

Referencing comments by Tory peer and former Marks & Spencer boss Lord Rose, who called the government's recent announcements "hot air", Ashley said in his letter "I agree with him".

"It is the disastrous business rates position (which I have raised many times over the years) and the dramatically increasing cost of employing people that are really causing business to struggle," Ashley said.

Ashley said the High Street would be "further devastated" without major reforms, and warned Burnham's suggestion that he will consider further business rates changes in the coming Budget were "too little, too late".

He also used the letter to attack Burnham's plans to clamp down on the use of recommended retail prices, saying instead the real issue is "price fixing in sporting goods and other markets" - where he cited the rising cost of official football merchandise.

Do you have any views, comments or questions about this story?