Sir,

It was with a sense of foreboding that I read the headline of last week's Tenby Observer, namely that Wetherspoons may be about to take on the De Valence pavilion.

My first thought was that Tenby, quite clearly, does not need another public house. There is ample selection for all, but the longest pub crawl. One could argue that on that basis alone the application should be dismissed. However, it is the economic impact of such a decision that is most concerning.

Seventy-two per cent of Wetherspoons shareholders are 'institutional investors' - or put in more simple terms, 72 per cent of the shares in Wetherspoons are owned by other large companies. That means that 72 per cent of the dividend (the share of the profits made by Wetherspoons) is paid each year to large companies. None of these large companies are based in Pembrokeshire. As such, none of the profits made by Wetherspoons would ever find their way back into the local economy.

By way of comparison, a locally owned pub generates profits for a local owner. That local owner will spend their profits in the Pembrokeshire economy - thus having a multiplier effect and recycling the profits into other local businesses, who can in turn succeed and make profits, creating a virtuous circle whereby many businesses thrive as a result of the profits made by the publican.

It could be argued that large chains force local companies to 'up their game', creating competition which is ultimately good for the consumer. Unfortunately, this overlooks the basic economic principle of 'economies of scale'. A large company has greater buying power with suppliers. It can negotiate lower prices due to the volume of goods it procures, it can thus squeeze out a small competitor who must pay higher unit prices for their goods due to the lower volume they procure. In simple terms, this 'competition' would equate to sending a six-year-old schoolgirl into the ring with Mike Tyson. The local business will lose, close, and there will be another boarded-up shop front blighting the town.

It is already difficult to make a good living in a rural and seasonally-driven economy such as that in Pembrokeshire. Those people who are brave and entrepreneurial enough to start and run local businesses should be supported. Children reaching working age need to see successful local role models, so they believe it is possible to make money from a local business - otherwise they will all move away from Tenby, and take with them the lifeblood of social regeneration. If no-one can make money locally because they are being overwhelmed by the economics of chain stores, there will be no-one of a working age in Tenby, thus no young families, and an ever-dwindling community.

So what should be done? The local council can foster entrepreneurialism in Tenby by providing local businesses with a fighting chance. Anyone taking on the De Valence should be given a grace period on business rates, to enable them to build a successful business which will be able to pay taxes, sustainably, over the medium to long term. This subsidy is not money wasted or lost to the local economy - as discussed above - lower taxes would enable an extra person to be employed, another family to be supported, another child in the local school.

One need only visit parts of South Devon or North Cornwall in the winter to see the desolation that follows when there are no people of a working age in a community. Small decisions can have a wave of unintended consequences. The council would do well to consider the implications of their decisions over the long term.

David Blackwell,

Manorbier