‘Dragons’ Den’ star Peter Jones: tax cut is wrong
Not many people would turn down a tax cut. But then Peter Jones, the Dragons' Den star worth an estimated £250m, can probably afford it.
While Tory backbenchers cheer the planned cut in the top rate of tax for those earning more than £150,000, Jones is on the warpath, warning the Chancellor, George Osborne, that the money would be better spent turning a whole generation of young people into entrepreneurs.
He insists that the wheeler-dealing of setting up a business can – and should – be taught in classrooms; that the idea of being a "born entrepreneur" is a myth that is holding Britain back. And he warns that the popularity of TV business shows will not translate into an economic boom unless couch potatoes learn how to turn a hare-brained idea into profit.
Speaking during a break in filming the tenth series of Dragons' Den, he lifts the lid on his "genuine ... very natural dislike" of his rival Duncan Bannatyne, says his youngest children could outperform The Apprentice candidates, and speaks for the first time about the conman who swindled him out of tens of thousands of pounds.
But first in his sights is the decision last week to cut from 50p to 45p the top rate of tax. "As a higher-rate tax payer, I'm disappointed. I would have liked to have seen that 5p go to support young people in this country ... to encourage them to consider entrepreneurship as a viable career path." Other high earners feel the same, he says.
He wants to "push and knock down the door of No 10" to get business taught properly in schools. "People have a right not just to learn about biology and economics and all those good things, but a right to be taught enterprise." Osborne last week announced a £10m scheme to give loans to young people to start businesses, instead of going to university. Jones says it is evidence that ministers understand the scale of challenge, but he argues that they must "put their money where their mouth is and put enterprise into the national curriculum". He is making a good start.
In 2009 he created the Peter Jones Enterprise Academy to equip school-leavers with the skills to set up and run their own business. Almost 40 colleges are signed up for this September's intake, enrolling 1,000 students to obtain a BTec in enterprise and entrepreneurship. "It's not like the old work experience where you used to become a tea boy for a week." Students start real businesses and go into established firms to learn the tricks of the trade firsthand.
Jones says he was lucky to have been inspired to go it alone by two people. Aged seven, he watched his father, a mechanical engineer; leave a large firm to go it alone. "I saw the pain and hardship you go through to try to start a business on your own." And, in his early teens, he noticed how one English teacher drove to school every day "in a top-of-the-range Porsche". The teacher ran a tennis academy during school holidays which gave hime a second income. Jones started helping out for some pocket money, but by the time he was 16 he had set up his own tennis courses. "It caught me like a bug."
He left school at 18, launching a successful computer business. "I was the only 18-year-old at school who had a three-bed house that I rented out. I stayed at home; I was a bit of a mummy's boy. Mum did all the washing and ironing." In the 1989 recession, he lost everything, when customers couldn't pay what they owed him. "I learned the hard way." Fast-forward a quarter of a century and firms such as his Red Letter Days.
Business TV shows, such as Dragon's Den and The Apprentice, have left viewers believing they have an idea that could make them millions. "But while 50 per cent of people think about it, 5 per cent actually do it. We need to change that." In particular, he is adamant that an "education gap" means that even those who try to start a business fail because no one has taught them how to do it.
He gushes about most of his fellow Dragons. Hilary Devey, a new recruit in the last series, is "a real gutsy woman" who "wears her heart on her sleeve". Deborah Meaden "is actually really nice off camera", while Theo Paphitis "just enjoys talking", though he has invested with the retail giant several times.
The same is not true of Bannatyne, the tough-talking Glaswegian. Until now. A show insider reveals the long-term rivals have put their differences to one side to invest in an idea together. Jones will not be drawn, saying viewers will have to wait and see.
But he insists the on-screen rivalry is real, and not staged for the cameras. "It was a very natural dislike, a general dislike for each other. I found him just incredibly brash and it was easy to have an argument with him because he was just always picking on very small things which are just irrelevant. That continues."
He does not watch the rival show, The Apprentice, which returned to the TV screens last week. "I've got three children under 12 and they could do a better job. They make Alan Sugar look amazing." Lord Sugar is, he insists, a "good buddy".
Jones's best investment in the Den by far was the £25,000 he put into Levi Roots's Reggae Reggae Sauce in 2007. Now with 34 products for sale with the Jamaican jerk flavouring – from sandwiches and pasties to cakes, nuts and drinks – it is the most successful idea ever pitched in the Den.
"I've got other investments that are doing very, very well, but Levi is in another class. Levi this year will generate income of nearly £30m. He is an absolute superstar." Next month, a new TV advert, produced by the Aardman team behind Wallace & Gromit, will launch as part of a £6.5m campaign.
"Put all of the combined investments made by all of the dragons in the Den together and it still doesn't get close to the value of Levi's creation. Which I don't keep mentioning at every point when I'm sitting in that chair."
Not every investment has been a success, though. Last month Jean-Claude Baumgartner, 50, was jailed for two years and eight months after blowing £230,000 invested by Jones and Paphitis in his "satnav for skiers" business. "It does make me feel a bit sad," Jones says now. "Not only because I lost my money. It does put a bit of a bad taste in your mouth and make you think: 'Right, we have got to make sure we don't get caught out again.."
Even the experts can get caught out. Sometimes you just have to learn the hard way.
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