Before we begin, I encourage Members to wear masks when they are not speaking, in line with current Government and House of Commons Commission guidance. Please also give one another and members of staff space when seated and when entering and leaving the room. You will all have seen that it is a very heavily subscribed debate, so I will impose a time limit. Janet Daby will move the motion.
I beg to move,
That this House
has considered support for UK high streets.
It is a pleasure to serve under you as Chair, Ms Nokes.
I am grateful to be granted today’s debate at a time when the UK’s high streets are collapsing. They are collapsing under the weight of pandemic closures and unreasonable taxation. Shopkeepers, their staff and customers alike are experiencing a poorer standard of living. They need the Minister to step up and promise to give them the support that they need. They need to be able to breathe a sigh of relief after 19 months of uncertainty and fear. They need to believe that things can indeed get better.
We all have memories of our favourite shops when we were younger—I know I do—whether a favourite bakery, sweet shop or joke shop. However, sadly, many of those places are no longer around for my children to enjoy. Some of the most iconic, big-name retailers even of the last decade have vanished from our high streets: Woolworths, British Home Stores, Debenhams and Littlewoods all spring to mind.
I congratulate the hon. Lady on securing today’s debate. Over the past few years, as the hon. Lady has said, we have seen an increase in businesses moving away from physical retail space to an online model. The move has benefited retailers at the top levels of their companies, as it comes with associated savings in areas such as business rates or, for us Scots, non-domestic rates. Such moves, however, have a heavy impact on local communities: fewer jobs, for example, or a lack of accessibility.
I thank the hon. Member for a really important and significant intervention. All the points that she has mentioned are very pertinent. There is a lot that the Government could do to make improvements.
Even big household names could not operate under the Conservative Government’s business rates. No one 20 years ago would have been able to fathom the end of Topshop—never mind the collapse of the entire Arcadia empire, leading to over 700 job losses and units being left to decay. The growth of online retail has slashed footfall in high streets and town centres, benefiting online giants like ASOS and Amazon and crushing local independents. There is still no commitment from the Government to an online sales tax, which would level the playing field. While major online businesses pay only nominal taxes, bricks-and-mortar small businesses are taxed into extinction. How can the Minister justify that?
I congratulate my hon. Friend on securing the debate. I have been in the House a long time. In 1981, Mrs Thatcher introduced a windfall-profit tax on the banks. Is my hon. Friend thinking of a similar windfall-profit tax on the people who have profited in the covid years, to get them to pay proper levels of tax to invest in our local communities?
I was in primary school at the time that my hon. Friend Gentleman mentions, but I thank him for the intervention. We need a fair tax system, and I will address that in my speech.
I see the effects of the system of business taxation play out in my constituency of Lewisham East. Taxation is simply too high for small and medium-sized enterprises, especially after an insurmountable fall in revenue since March 2020. The current system of business taxation is outdated and unfair. It punishes small businesses aspiring to serve local communities and allows online empires to grow only stronger. In 2019, it was estimated that the eight largest tech companies operating in the UK avoided a combined total of £1.5 billion in tax.
A House of Commons public survey found concerns for our high street and ideas for improvement. Clair said that
“it’s sad to see so many town centres looking deserted, as many shops have been forced to close due to rents and rates.”
“There are empty units which make the town look dead”.
Nobody wants a dead town. Jags was concerned about antisocial behaviour rising on high streets when shops are boarded up. When asked what the Government could do to turn around prospects for high street businesses, Jane simply said:
“Slash taxes for small businesses. Make it worth our while to work the hours we do.”
I agree and Labour agrees.
We need a Government who demonstrate that they are pro-workers and pro-business. A review of all tax breaks needs to happen. The Government need to be serious about investing in a sustainable way that allows home-grown businesses to flourish and ensures the best value for the taxpayer. The local high street is for leisure, but for some it is a lifeline. Almost half of the people living in London use their local area daily. My constituents rely on local shops. They do not want to have to do a laborious journey on public transport or drive through busy London to run their errands. This applies especially to those living with disabilities or pushing prams, or to elderly people struggling with walkers. Why should their lives become more difficult when people wish to shop local and local people wish to work local?
It is not just a problem in cities. High streets that are a centre point for towns across the country are being neglected. A thriving high street can be a source of great pride and a declining one can be shameful. When an area is in decline, property prices fall, the young professionals move out of the area and the local environment begins to decay. We see poverty intensifying and becoming more visible.
The recent trend of high-street bank closures is especially concerning. According to the House of Commons Library, in the past nine years almost 40% of high-street bank branches have closed their doors. In the year between March 2020 and March 2021, 700 branches have closed. That is staggeringly high. I can see the effects in my constituency. The Catford HSBC branch always has queues going out the door, yet it is due to close, which is absurd. The branch is needed because not everyone can adapt easily to online banking. Not everyone has broadband or the support to make the transition to online. It excludes a huge swathe of vulnerable people. All of those customers now need to go into the centre of Lewisham, adding pressure to that branch. A branch of Barclays in the area has already closed. I wonder why the Minister thinks this trend is developing and whether he agrees with it. Will he support my call for HSBC to reconsider this closure?
We should not expect the general public to be comfortable with doing everything online. Local places closing means familiar and trusted people and services are disappearing. It also deprives people of those small moments of human contact, which may seem like nothing to one person, but to another are the tipping point into social isolation. It is essential to people’s wellbeing that in-person services continue. I would be grateful to hear from the Minister what can be done.
While I want to focus today on the burden that the Government’s tax rates place on our struggling businesses, we cannot ignore the impact of the shortage of HGV drivers on our high streets. This is a Brexit-induced crisis that was completely foreseeable. Coupled with the lack of workers to tend to our crops and farm animals, shops have experienced dire product levels on their shelves. High-street cash and carries are struggling to serve their customers. We are also hearing reports of pressure building towards Christmas. When it comes to Christmas, we know it is serious. Most British households want a turkey—I want a turkey—but not every family that wants one will get one, and that is the headline. This comes at the same time as the shocking news of a labour shortage, meaning that pigs are being slaughtered and their meat is unsellable. We all need supply chains freed up and workers trained up so that the embarrassing lack of stocks can be resolved and a Christmas dinner crisis averted.
The Mayor of London has put vision into action to inject new life into our high streets. He is creating vibrant shopfronts for vacant properties, supporting start-ups and keeping the streets clean and appealing. However, there is only so much that local leaders can do. We need a Government to show up and show that they back businesses, workers and communities.
There are not as many Members as I first feared, so an informal guidance for about five minutes would be very helpful.
It is a pleasure to serve under your chairmanship, Ms Nokes, and I congratulate Janet Daby on securing this debate. I am fortunate enough to represent a number of thriving towns and high streets across my constituency of Truro and Falmouth. Recently, I was delighted and proud to see Truro jump an incredible 72 places to be named one of the best high streets of 2021, despite the coronavirus pandemic. That means that our little city has had a vitality ranking that beats the likes of Brighton, York, Exeter, Oxford and Taunton—all those having exceptional high streets.
Within my constituency I have two high streets that benefit from business improvement districts: Truro and Falmouth. Both have exceptional teams and are worth their weight in gold. Both of the BIDs do so much for the high street businesses and for the shoppers. High streets have struggled, but the BIDs do everything that they can to keep it lively, thriving and pretty. For example, if there is an empty unit on the high street, they are on the scene to cover it over with bright and helpful graphics. Their branding is second to none, particularly in Falmouth, and they did Cornwall proud during the G7 summit earlier this year when it was showcased by the world’s media. I put on record my thanks to the BIDs of Truro, Falmouth and Newham.
As we emerge from the pandemic and the high streets bounce back, the reopening high streets safely fund and the welcome back fund have proven to be instrumental. In Truro, we are currently going through our towns fund process, where an injection of £23.6 million is set to regenerate and transform the city centre. That will be huge for the high street, and will help to reconnect Truro with its water.
As I mention the towns fund, I would also like to make an appeal to the Department and to the Minister, as I look forward to further details being released about the next tranche of the towns deal so that I can lobby, making a similar case for Falmouth.
The hon. Lady is making a very good speech, but she may not know that in my constituency we declared Huddersfield a sustainable town and a sustainable community under the United Nations sustainable development goals. We are building a network of 500 towns and cities; would the hon. Lady consider taking the message back to her communities that we would love to work in partnership with her?
I am very happy to take that message back, and hopefully we can connect—I think that is very useful. Falmouth is a town that often gets overlooked because of how well it does with the limited resources it has. A towns fund deal for the port of Falmouth, which is the gateway to the Atlantic, would absolutely unleash this town’s potential. Falmouth’s bid is already leading by example; their proactive engagement tools have supported a brilliantly diverse business events and engagements scene, and have welcomed the regional leads for the south-west in for bids. I would encourage the Department to look closely at the Falmouth bid as a case study for a thriving high street. There needs to be much greater representation on rural and coastal issues pertaining to high streets at the central debating table. On too many occasions, the debate is dominated by the captains of large businesses and of large urban areas, and the points of micro, independent and small businesses in this landscape are largely missed. The high streets taskforce is a good example, as Cornwall has absolutely no representation on it.
During the pandemic the high street had to adapt. In both Truro and Falmouth al fresco dining became the norm, allowing local bars and restaurants to make use of public open spaces to host punters, and continue to deliver a quality service and product. The red tape around the legislation on pavement licences, which has been granted an extension to September 2022, must be cut to allow businesses to extend trading space outside their curtilage. In Cornwall that has opened up opportunities for more imaginative place-shaping, ideas for encouraging visitors and greater collaboration between the small business sector and local councils. Falmouth has been on the front foot with this; by liaising proactively with Cornwall Council, car parks, less used pavement spaces and quiet areas have been transformed into al fresco dining and event options. That has helped to support their summer season as we bounce back from covid.
Lastly, in Cornwall our larger towns, like Truro and Falmouth, are picking up big devolution packages—which is fantastic. However, those packages include public services such as car parks and libraries. The House has made excellent progress by, for example, taking away business rates on public toilets, but we can go further than that; I would love to see business rate relief extended to public services such as car parks, libraries and council offices, encouraging them to relocate to our high streets and giving people more of a reason to visit them. I could go on and say much more, particularly about supporting our high streets to make them low-carbon. We must do more to encourage the green transition: there has to be greater guidance, support and investment for green schemes. As it stands, we rely too much on individual businesses to make such changes, and that puts more pressure on them as they tread water on the back of the pandemic, particularly when we take into account listed buildings and conservation areas, as we have seen in Cornwall.
Although I am a green champion, there is much to consider in this complex area. The future of the high street is exciting and I, for one, will continue to champion high streets in this place.
I send my condolences, and those of the people whom I represent in Barnsley, to the family, friends and constituents of Sir David Amess. It is a pleasure to serve under your chairship, Ms Nokes. I congratulate my hon. Friend Janet Daby on securing this important debate.
Our high streets have had a difficult 18 months. As footfall recovers, we need to look more closely at how the impact has been distributed across the country. In Exeter, Aldershot and Reading, for example, at least two-thirds of neighbourhoods are likely to have been able to save through the pandemic. That is true for fewer than 25% of neighbourhoods in Hull, Blackpool and Barnsley, however. That will have a real impact on consumers’ ability to spend money in their local economy. In reality, the pandemic has hit poorer areas harder, and we need to consider how we address that.
The demise of our high streets did not begin with covid, but with a decade of austerity. Over the last 10 years, 10,000 shops, 6,000 pubs, 7,500 banks and more than 1,100 libraries have closed. That is felt particularly acutely in semi-rural areas such as the one I represent in Barnsley East. I represent a collection of towns and villages around the centre of Barnsley that do not benefit from a strong local transport network, so the closure of the local bank or library has a huge impact on the local community. We need to ensure that we reverse those figures and do not allow the continued demise of the high street.
In the last year alone 180,000 retail jobs have been lost, and 200,000 more are at risk this year. We need to look at bringing empty commercial properties back into use for new and existing businesses. We need to level the playing field between high-street and online businesses, because the tax system, which was mentioned earlier, is simply not equal. We need to promote entrepreneurship and innovation on our high streets so that they reflect the needs of our local communities.
The challenge faced by our high streets is a good example of why the concept of levelling up is needed. The problem is that we are yet to see the reality. Barnsley Metropolitan Borough Council has seen some of the worst cuts in the country. The Government talk a good talk about the idea of levelling up poorer communities, but in reality, that is simply not happening. Earlier this year, the Chancellor’s constituency of Richmond (Yorks) was prioritised for funding over Barnsley, and even though Barnsley is more deserving according to every categorisation of need, it did not get funding. We need to make a change to ensure that levelling up is not a slogan, and that we improve our high streets.
It is a pleasure to serve under your chairmanship, Ms Nokes. I thank Janet Daby for securing this important debate.
As chair of the all-party parliamentary group on the future of retail, and as a former “Woolies” worker, this is an issue about which I care passionately. During the pandemic, while many retreated to the safety of their own homes, our retail workers rolled up their sleeves and got on with the job. For that, we owe them a huge debt of gratitude.
The challenges faced by our high streets are not new; we have been debating them for decades. The events of the past year have amplified and accelerated those difficulties. I know that the Treasury threw the kitchen sink at supporting businesses during the pandemic, whether through the furlough scheme, the rates holiday or the grants scheme. Those measures have been a life- line for many businesses in my patch.
The role of our high streets is changing, and to help our town centres adapt and change, the Government have rightly been flooding them with funding, including the future high streets fund, the town deals, the levelling-up fund and any other such schemes. In my part of the world and that of Alex Cunningham, Stockton has received £16.5 million of funding to build a high street that is fit for the future; Thornaby has received a £23.9 million town deal that will, among other things, help tear down a defunct hotel that has been an eyesore in the town centre for years; and our levelling-up bid for up to £20 million would help to improve Yarm’s high street. I remain incredibly grateful for that, but there is more to high streets than slick buildings and shiny objects, and that is the businesses that give our high streets a soul.
This afternoon, I met the British Retail Consortium and the CEOs of a huge number of retailers. The biggest single issue raised, which is life or death for many stores in our high streets, was business rates: 83% of retailers feel that they are likely to close stores in the near future if the burden of business rates is not reduced. The business rates regime is simply not fit for purpose. Business rates are outdated: they strangle growth and smother investment. They disproportionately whack the retail and hospitality sectors. Retailers account for 5% of the economy but are subject to 25% of all business rates.
We must do more to tackle crime in our high streets and town centres. Last year, there were 455 assaults on shop workers not every month or every week but every single day. That is the young student in their first job or the semi-retired person topping up their income. I am delighted that the Government have recognised the issue and are looking at it, but we need action and we need it now. We must do more. Many in the retail and hospitality sector are innovative and optimistic. They are ready to meet the challenges of the 21st century, to grow, to provide jobs and to breathe life into our town centres. They can only do that if the Government reduce the burden of business rates, ensure that retail crime is tackled and support innovation in the sector.
It is a pleasure to serve under you, Ms Nokes.
We need recovery and reform. Anyone who has been to York will know that our high street offer is incredible, yet now, like elsewhere, we are battling empty shops, labour shortages, logistic challenges and offshore landlords more interested in the financial portfolio generated from their property ownership than invested in their high street. This perfect storm sucks the life out of not only our communities but local finances.
With changes to the system, life can be brought back to our urban cores. A few pleas from my local businesses: we need to move away from a property-based tax––I am glad that that is echoed across the House––and build one predicated around profit or turnover. York’s extortionate property prices make business rates unsustainable. Businesses are also calling for the reduction in VAT to be sustained. Recovery takes time and when your high street is dependent on the visitor economy and the visitor economy is dependent on the high street, time to recover is needed.
Currently, venues are shutting part-time due to labour shortages and less demand, each compromising the other. In summing up, will the Minister say what discussions he has had about introducing the youth mobility visa for EU citizens so that labour supply can continue? In York, labour vacancies are up 10% from August, with 3,400 jobs needing filling. Skill shortages are hitting York’s offer.
We do not just want recovery; we want reform. The hope lies in indie York: 65% of York’s retail offer is by independents. The challenge is that the retail space vacated by the big chains occupies 9.3% of the city. We need these large empty spaces repurposed for independent social enterprises and what Labour in York has envisaged: a family-friendly York. A family-friendly York demands reform. Since being elected, I have campaigned for York to be a family-friendly city. Local families do not visit: it is too expensive, with too few child-friendly spaces, unless you have the means to pay, and too few public toilets. Worse, the night-time economy clashes with the day, so parents simply do not want their children to come into town.
Imagine Government steering local authorities to become family-friendly places where children can play and parents can relax. Urban95 or the UN child friendly cities initiative can drive this. It is good for families, good for economies and good for our environment. York is perfect for that. Imagine safe routes in, so that children can enjoy the journey and the destination. Imagine the urban landscape designed for children and families. Imagine no hen and stag as they are planned out. Imagine spaces to play, explore, learn and create. York Explore, our libraries, have their Lego tables and cafes. York Museums Trust, now with free entry, has created spaces. York Archaeological Trust is launching digs for families to learn together. We have churches, empty shops, and even Parliament Street, just waiting to hear the laughter of children and welcome families. I trust that the Government will look at family-friendly York as an example of how we can really invest in the future generation and the future of our high streets.
It is a pleasure to serve under your watchful chairmanship, Ms Nokes. I must first put on record how brilliant my local businesses across Hyndburn and Haslingden are—I have had the pleasure of visiting quite a few of them in my campaign to shop local—but there is no doubt that our high streets have struggled.
The decline of high streets across the country in the last few decades is well documented. As our shopping habits have changed, first towards shopping at supermarkets and megastores, and then online, many of our high streets and their small shops have been repeatedly battered by the headwinds.
In my part of the world, beautiful Lancashire, the decline of the high street has been felt particularly hard by local people. Many of our high streets, which used to teem with independent stores, have been unable to innovate with the new reality, and have become shells of their former selves. In some places, charity and betting shops are now the most numerous, while other shops sit empty or change hands frequently. Along with that loss of amenity, the decline in our high streets has been enhanced by an equal loss of civic pride by some.
We now stand at a crossroads. Down one path lies a continuing decline of high streets and the inevitable conversion of many shops into flats or houses. That will be an acceptance that there is simply nothing that we can do but manage the decline and death of our high streets. The other path leads to a new, innovative model for the high streets, which sees them thriving once again. It is down that second path that I believe the Government are heading.
I know that today’s motion states,
“That this House
has considered support for UK high streets”,
but that is incomplete. A more appropriate motion would be, “That this House has considered support for UK high streets and the effort and investment made by this Government in saving them”, for that is a reality.
I have witnessed, all too much, how my Labour councils have let down and ignored my high streets and town centres. We need to review the support that has been given to local councils. There is the £3.6 billion towns fund, including a £1 billion pledge for the future high streets fund, £4.8 billion across the country in the levelling-up fund, the coronavirus job retention scheme and business interruption loan scheme, bounce back loans, business grants, the establishment of a retail sector council and a high streets task force to provide expert advice to adapt and thrive. That is just a snapshot. There are many other measures, such as business rates relief retail discounts, that I have not even mentioned.
I am confident that, when we get to the spending review, even more will be announced by the Chancellor to help businesses and our high streets. When people ask me what levelling up is, in practical terms, this is it. In my area of Hyndburn and Haslingden, these packages of support are having a real impact. I have been working with Hyndburn Council to prepare a levelling-up fund application to regenerate our town centres. That will translate into real improvement on the ground, felt by shoppers, shopkeepers, and visitors to our towns. I hope that bid will be looked on favourably.
However, it is not just about the money. To me, levelling up and supporting our high streets means supporting them to change their thinking, giving businesses the tools and support to innovate and embed a culture of enterprise, new thinking and competition to challenge the online retailers. To help with that, I have lobbied hard for Hyndburn Council to employ an economic development officer to support businesses. That has finally been accepted. With that post now in place, we have someone at the council dedicated to supporting our local businesses and high streets. That is vitally important.
Equally important is restoring the sense of civic pride and community responsibility for our high streets and town centres. It is vital that we combine localism and levelling up to take advantage of the investment and help from Government to restore civic pride and create unique and vibrant high streets that people choose as their destination, rather than always just clicking a mouse.
I thank Janet Daby for securing this debate. It is a great opportunity for us all to highlight our amazing local high streets.
The last debate that I led in this place, back in March 2020 before the pandemic, was on the impact of bank branch closures on the high street. Town centres were already struggling to remain vibrant in the face of changing shopping habits, reduced services and falling footfall. Nobody could have predicted the covid tsunami that they were about to face, making tackling those challenges far more urgent. Sir John Timpson, who led the high streets experts panel in 2018, said that we have seen 10 years of change in one go, with all the negatives but without the positives. It has been absolutely brutal, with well-kent names falling like dominoes and nothing to replace them.
As spending on online retailers accelerates, whatever plans we have to boost the high streets need to be turbocharged—something that maybe one of Jeff Bezos’s rockets could help with. It matters for the spirit and quality of our towns, but it is also important for our covid recovery. We know that money spent locally in high streets is money that stays in the local economy and is not left to languish in some offshore tax haven.
There is a need to level the playing field. I welcome one measure being explored by the Scottish Government—the possibility of a national digital sales tax, which would be well worth exploration much wider afield. Much work needed on support for high streets is, rightly, devolved—the more local the better, for finding solutions that work for any given town.
Scotland’s share of any funding pot for town centre regeneration must be devolved to the Scottish Government, so that they can pursue their well-considered plans. These measures include the town centre action plan, the “Scotland Loves Local” campaign and the focus on developing more 20-minute neighbourhoods—liveable, accessible places where people can meet their needs within a 20-minute walk. Direct funding, as this Government seem so increasingly keen to pursue, reduces the impact and cohesiveness of that kind of work, muddying the field to no one’s benefit. We need much more local decision making.
Although our high streets must evolve and adapt, the good news is that we see many towns successfully bucking trends and local businesses thriving, but in a time of crisis, we need decisive action, support and strong local leadership. Above all, finding the best way forward must involve the community. There is not a one-size-fits-all solution, as every town will have its own unique history and its own strengths and traditions. Communities must be consulted meaningfully and involved in plans at every stage. We need leadership from ourselves and from our local councils.
In my local area, in Penicuik, we have seen local leadership driving forward the business improvement district, which has been highly successful. We have seen a real change in that community over recent years, although there is much still be done. In the county town of Midlothian, Dalkeith—as a former council leader, I should declare an interest—we had a vision when I was council leader. I used to have meetings in the office. People would come into Midlothian House and would look out the window at the centre of Dalkeith and everyone would pretty much say, “Is there not something we can do about that?” We eventually said, “Yes, let’s do something about it. Let us start with a blank sheet of paper.” We started looking into feasibility studies. Unfortunately, it was opposed by the opposition at the time. Subsequent to the change of administration after the 2017 council elections in Scotland, those plans were effectively burned. The importance of looking at what we can do now is even more critical.
The town centre in Dalkeith has been neglected for years and urgently needs a clear plan to support its regeneration. Instead, something that resembles a dog’s dinner is being taken forward by the current council. Ideas have been developed by a local community group, One Dalkeith, which has genuinely reached out to the local community to engage and to take on board its thoughts and views. I urge the council to look back at what the community wants to see happening, rather than following through on its current plans to abandon Dalkeith by closing all the council offices there, in a move that would ultimately devastate the town centre.
Midlothian is a fantastic place. It is little wonder that it is one of the fastest growing parts of Scotland, if not the fastest growing. We need more homes—that is absolutely true—but we also need proper consideration of public spaces and facilities and the needs of our communities. The energy and talent of people who live and work in our communities must be harnessed as we rebuild, to make sure that our town centres and our communities can continue to thrive.
It is a pleasure to serve under your chairmanship, Ms Nokes. I thank Janet Daby for bringing forward this important debate. Owen Thompson has said something of the Scottish context, and it is within that context that I address my first remarks. What happens when it comes to our high streets in Scotland is largely the responsibility of the Scottish Government. My party and I are keen on a policy that tackles the impact of non-domestic or business rates, as mentioned by Matt Vickers. These charges are making high street businesses simply not competitive with online ways of buying and selling.
Under devolved powers, rates could be reduced dramatically or abolished altogether for particular forms of retail businesses on our high streets. The Scottish Government set the business rates for businesses centrally and we know the rates are an incredibly important income for Scottish councils. If they were unilaterally got rid of or reduced, Scottish councils would face a terrible funding problem. In the Scottish context, I suggest there should be a discussion between the Scottish Government and the Convention of Scottish Local Authorities. That could be echoed in the UK context, with a discussion between Her Majesty’s Government and the Local Government Association. There is genuine potential here.
As the hon. Member for Midlothian very wisely said, the income generated in our town centres is, in turn, spent in our town centres. It is banked in those town centres. In the highlands, we rely greatly on our tourism product. If town and village centres in the highlands are looking decrepit, run down or full of empty properties, frankly the tourists will not be enthused by that.
I had an alarming email today. Although it is not about a matter that is a direct responsibility of the Minister, I will share it. It is from Mr Andrew Mackay, the owner of three hotels in Caithness: The Norseman in Wick, The Pentland in Thurso and The Castletown in Castletown. Last year, his electricity costs for these three high street hotels were £76,764. In September, he had a quote that increased the cost of that electricity by £25,000, which is 33%. Today, he had a quote of an increase of £53,000, which is a 70% increase. Can you believe that, Ms Nokes? That takes his electricity bill for those three important town centre businesses from £76,764 a year to £130,000. He is faced with a problem that he does not know how he will cope with.
In fairness, that matter is not the Minister’s responsibility, but I will be writing to Her Majesty’s Treasury to say that we have a huge problem. We need to park party politics on this subject completely and utterly, because this is about power and the cost of power. If that is happening in my constituency, in a remote part of the highlands, it could be happening in constituencies all over the UK. We have to be very careful about this; it is a serious issue. One has unwelcome emails from time to time; this was one for me today.
It is a pleasure to serve under your chairmanship, Ms Nokes. I, too, congratulate my hon. Friend Janet Daby on securing the debate.
Our high streets, the beating hearts of our neighbourhoods, are in danger, threatened by low footfall, an outdated model for business rates, the impact out out-of-town and online shopping and a Government who have failed to tackle the growing crisis. Against that challenging backdrop, I have a small kernel of hope to share, thanks to the visionary work of our Labour-led Stockton council and the odd handout from the Government as well.
To quote my good friend, Councillor Nigel Cooke:
“This is an existential threat we are facing. If people are not coming into town to shop at Debenhams because there is no Debenhams, there is no Marks &
Spencer and so on, what are they going to come in to do?...You have to be proactive and have some ambition.”
Fortunately, Stockton council has ambition in bucketloads. It has bought the old Castlegate shopping centre so that it can be torn down, opening up space in the town centre to build a vast urban park, a library and a leisure centre, linking Stockton town centre with the beautiful waterfront of the River Tees.
I agree and I am sure the hon. Gentleman is about to tell us that it is a great thing that the Globe is reopening and coming back to the old high street, but would it not have been better if it had opened in 2012 and cost £4 million rather than opening this year and costing the best part of £30 million? Public money needs to be well spent.
Public money does need to be well spent, and it was not exactly all public money that went to it, but that is another matter. I will not have anyone talking down my town and the ambition of our local council. The Globe is one of the finest art deco theatres in the country, and it has hosted everyone from the Beatles to Stevie Wonder—I know that appeals to my generation, rather than to some of the younger Members here. It has been refurbished and reopened, and it is the biggest venue between Newcastle and Leeds, so all the big acts are now following us into town.
Just a couple of weeks ago I visited Drake the bookshop to support Bookshop Day. Thanks to Stockton’s ambition, the bookshop has been able to expand. The council’s vision puts the wellbeing of our constituents at its heart, with the focus on supporting events, green space and independent shops more than paying off. Other local authorities are now knocking on Stockton’s door for the blueprints. Even Tory Ministers come to Stockton to see how it is done.
However, councils cannot be left to do it on their own. They should not have to spend so much time bidding to centralised funding pots. The administration of the £3.6 billion towns fund, for instance, still causes me serious concern. I can understand why Billingham in my constituency was deemed to be in greater need than Tory MPs’ towns, but I cannot understand why it has missed out.
No, I will not give way.
Many of the people who actually make our high streets great are crying out for urgent business reform, which is something Matt Vickers and I very much agree on. Again, here Labour has the necessary vision that the Government lack. Labour would scrap business rates altogether, and in the meantime we would freeze them and extend the threshold for small business rates relief next year. Labour would pay for these measures by increasing the UK digital services tax to 12%, making a more level playing field between online and bricks-and-mortar shops. There are solutions out there to make radical change, and I would be very pleased to show the Minister around my home town of Stockton so that he can see how it is done.
It is a pleasure to speak in this debate. I thank Janet Daby for leading the debate, and I thank Members for the incredible contributions that have been made. It will come as no surprise that I wish to speak on behalf of my constituency, and indeed my home town of Newtownards. I am sure that the Minister is very keen to get over and have a look around. The previous Minister, Kelly Tolhurst, visited Newtownards and was greatly impressed by what she saw.
This is a much-needed debate, given the impact of the past 18 months on our high streets. Many sections of society have suffered and seen financial losses, and unfortunately our local high streets most certainly fall into that category. I warmly welcome any action to help our local shops. Topshop, Thomas Cook, Peacocks and Edinburgh Woollen Mill are just a few examples of the companies that have gone into administration, and indeed the latter two had branches in my constituency. I am pleased to say that we have been able to fill those gaps and retain our position as a high street that many people want to come and see. It is full of independent shops and family businesses. It has an array of shops that many people wish to visit, and they will keep coming back.
It has been noted that over 726,000 people have lost their job since the start of the pandemic. Many people have become a little too handy with online shopping, and they forget about the jobs that are lost as a result. I know that the Government have set out a strategic plan for how we can move forward. The Government are also committed to the levelling-up process, and I have asked the Minister many questions about that in the Chamber. They are very keen to ensure that the process happens not only down here in the south of England, or even in the north of England, but across the whole United Kingdom of Great Britain and Northern Ireland, and it should do because that is what we wish to see.
I will take a moment to talk about what we are doing back home in Northern Ireland to help our high streets. I hope that others can take note and discuss similar schemes. The Economy Minister, Gordon Lyons, who is responsible for enterprise, trade and industry, has introduced the “Spend Local” voucher scheme, allowing those over 18 to apply for pre-paid cards worth £100, which must be spent on the high street and not online. So we go out of our house, walk down the path and spend the money on the high street. People are allowed to use this in shops on the high street and across the whole constituency, so I hope that those cards will be used in shops that have struggled throughout the pandemic and I greatly welcome the step taken by the Minister in Northern Ireland. It is my understanding that some people have already started using their cards. A lady came into the office the other week and she was one of the first ones, with card number 2,011—there are potentially cards for 1.3 million people. It is quite a massive scheme.
My office has helped many elderly people register for their cards and has encouraged them to shop locally on our high street. The money was designed to rejuvenate the independent businesswoman who has taken a hammering in the last year and I am excited to see the dividends of the scheme, which will remind people of the joy of spending locally, and to see local people putting their money back into our economy rather than into Amazon’s offshore tax havens, which grieves me greatly. Get it back into the high street, get it back into the local shops and make sure that happens.
In my constituency of Strangford, Newtownards won high street of the year 2020—a brilliant achievement given the challenging times. We have a fantastic high street, which needs support from the Government locally in the Northern Ireland Assembly. It is not the Minister’s responsibility, but we have been able to do something very specific and helpful and he may wish to comment on that. People’s livelihoods and jobs depend on this and we must do more to encourage people to spend in our local high streets as opposed to online. Whether that is through retail, travel, hospitality, theatre and so much more, it is crucial that our local businesses know we are there for them and they have our full support.
I also welcome the Government’s levelling-up agenda, which is set to answer the plea of left-behind towns. The strategy also aims to invest more finance in cities, towns and rural areas and give businesses more scope as to how investment is made. When the Minister sums up, I look forward to hearing how he can help high streets through the levelling-up process across the whole of this great United Kingdom of Great Britain and Northern Ireland and provide the reassurance that the Government will do all they can to get our high streets back up and running, and introduce schemes to allow them to diversify and do what some of my local shops have done and set up parallel online shops based in the high street. That has happened on several occasions in the past year. I think there is a dual method. We want to see people back on the high street and the footprint again. When we see that and people spending their money, the shops will rejuvenate. That is what I would love to see. In our town, we have that—thank the Lord for it—but I look forward to hearing what the Minister says.
It is a pleasure to see you in the Chair, Ms Nokes. I thank Janet Daby for bringing the debate to the Chamber and all hon. Members who have contributed for championing their local places. I have certainly picked up a few more places that I would like to visit. The play that Rachael Maskell mentioned certainly has a lot of appeal for me with my family. I am sure they would enjoy coming to that. Alex Cunningham spoke so passionately that he could not help but sell his city, which is also going on the list of places to visit in the holidays.
I am sure that all hon. Members will be visiting my constituency very soon when they come to COP26, which is being held in Glasgow Central. Many of the local businesses in Glasgow Central are a bit nervous about that and about the road closures and the disruption that may be caused within the city. So that is all the more encouragement for hon. Members, when they come to Glasgow Central in a few weeks, to go out and spend their money in the local high streets round about. Finnieston is on the doorstep of the SEC complex, with many excellent independent shops and restaurants where it will be easy enough for hon. Members to spend money. Lots of local high streets in Glasgow have seen an uptick in visitors, as people have stayed more at home in the pandemic and have not been travelling, either further away to other parts of the UK or into the city centre.
Of course, there is a different challenge for city centres and how they rejuvenate after covid, having lost many big shops such as Debenhams, which is a huge retail space in Glasgow city centre. It is now a challenge for all of us to decide how to refill those spaces and rejuvenate the city centre. I am glad that Glasgow city council has a strong city centre strategy that looks to bring people back in to live in our city, but we need the services that come with that as well—the schools, the nurseries, the access to medical services and all those local things that make a community a home. That, and how we make it work properly, is the challenge for all of us at the moment.
I am glad to see that part of the city centre that has long been neglected—the historic High Street of Glasgow, the heart of Glasgow—has its own high street action plan. If anyone happens to be in Glasgow this weekend, ‘Mon The High Street Day is a series of events down Saltmarket and the High Street to promote that historic part of the city and see it come back to life. But there needs to be a whole strategy and approach to make sure that that can happen in each of our towns and cities. It will not happen on its own; it needs a wider framework.
Some of that is about changing how we move around our cities—getting people cycling and walking rather than driving through. Govanhill and Victoria Road have recently had cycle lanes installed. Some traders were upset about the loss of parking spaces but actually it has allowed businesses such as the Transylvania café to offer food and music, so people stop, stay and spend their money. We need to reimagine how those spaces in our towns and cities work to encourage people to stay and enjoy them, because it is about more than just retail.
The SNP supports the digital sales tax; for many years we have had the small business bonus scheme, which has removed many businesses from the business rates system, allowing them to start up, develop and grow their businesses. We are very keen on the 20-minute neighbourhood solution, which will allow many people to use their neighbourhoods more. All that is seen in the wider economic context. My hon. Friend the Member for Caithness, Sutherland and Easter Ross was quite right to point out the impact on businesses of increased electricity and gas bills. I was speaking to the Federation of Small Businesses just today about that. The FSB is looking for support from the Government in the coming Budget not just for individuals, for whom this is very serious for heating and eating, but for businesses, which need to be able to open their doors, produce the materials that they sell and operate their businesses on our high street. They face a very difficult winter and need all the support they can have.
The Government have the opportunity to keep the VAT reduction. They reduced VAT during covid but many businesses in tourism and hospitality did not get the benefit because they were closed. If the Government keep the reduction rather than increase VAT, that would boost our hospitality and tourism sector. I will also make a plug for an issue close to your heart, Ms Nokes, of adding the beauty and hairdressing sector, because it could do with that VAT boost to bring people into towns and cities.
We have seen the £20 universal credit cut, which will take money out of local people’s pockets and out of their high streets. The national insurance rise is a tax on jobs, too. I challenge the Minister to respond to those issues, to help out the high streets and to make sure that people have money to spend in their local shops this winter.
It is a pleasure to speak under your chairship, Ms Nokes. I warmly congratulate my hon. Friend Janet Daby on securing this debate and on setting out so powerfully the impact of online retailers on high streets and the lack of a level playing field. It was a pleasure to hear from my hon. Friend Stephanie Peacock about the long-term challenges that high streets have been facing since before the pandemic. My hon. Friend Rachael Maskell spoke about pleas from her local businesses to change the taxation system, and my hon. Friend Alex Cunningham spoke with great passion about his local independent shops and the work of his local Labour council.
Members from all parts of the House have spoken about the personal importance of their local high streets, and I will not be any different. The high streets in my constituency are at the heart of our communities. The people I represent value and benefit from the shops at Oldfields Circus, Greenford Broadway and Greenford Avenue, to name but a few; and Pitshanger Lane, which deservedly won the title of London’s best high street at the Great British High Street competition in 2015, is home to more than 50 independent traders. The chair of the local traders association, John Martin, is a tireless advocate for them and high streets across Ealing and beyond.
As we have heard here and I am sure Members in the main Chamber are making clear as we speak, the health and vitality of our high streets is worth fighting for, but the Government are ignoring pleas from many high streets across the country for the support they need to thrive, and in some cases, simply to survive. High street businesses and those who work in them need the Government to act. As USDAW has made clear, that is crucial to those working in high street retail, who have experienced job insecurity for some time, only made worse by the covid-19 pandemic. USDAW has called for an urgent recovery plan for the retail sector that involves Government, retailers and workplace representatives working together to address the structural challenges facing the sector. It is absolutely right to make it clear that a key part of any plan must be fundamental reform of the system of business rates.
It should serve as an urgent call to action for this Government that the British Retail Consortium’s retailer survey found that business rates were a factor behind two in three store closures in the last two years. While high-street stores are feeling the burden of business rates, their online competitors, which typically pay far lower business rates on their warehouses, have seen their profits boom, especially during the pandemic. The current system of business rates is simply not fit for the 21st century. It punishes investment and entrepreneurship and it hits the high street.
We thought that the Conservatives might have realised this, as their manifesto at the last election promised that they would
“cut the burden of tax on businesses by reducing business rates.”
They promised that that would be done via “fundamental reform” of the system, yet we read reports in the newspapers that the Chancellor has been too busy to pursue a business rates review. Rumours abound that the Government may even abandon the promise of a fundamental review of business rates altogether, so I would welcome the Minister taking this opportunity to quash those rumours. I urge him to confirm that the review of business rates is still going ahead, that its conclusions will include proposals for fundamental changes, and that those changes will be announced in the coming weeks.
We need that change because the business rates system is antiquated and not fit for the current economy. That is why, as my hon. Friend Rachel Reeves, the shadow Chancellor, has set out, if we were in government today, as an intermediary step we would freeze business rates until the next revaluation, benefiting sectors such as retail and hospitality that are hit the most by this tax. We would raise the threshold for small business rate relief to give small businesses a discount on their business rates bills for 2022-23, ahead of more fundamental reform, and pay for that in the short term by increasing the digital services tax to 12% for one year and, in the longer term, with a higher global minimum rate of corporate tax for large multi- nationals.
Beyond that, a Labour Government would scrap business rates and introduce a new system that would incentivise investment, promote entrepreneurship and reward businesses that move into empty premises—and yes, it would involve large online tech giants contributing more. Both the immediate support we propose and our approach to fundamental reform would shift the burden of business tax towards the online giants. It would target the greatest support at high-street businesses that need it most, and it would support jobs for people across our country. That is what it looks like to tax fairly, spend wisely and get the economy firing on all cylinders, and that is what our high streets need.
It is a huge pleasure to serve under your chairmanship, Ms Nokes. I congratulate Janet Daby on securing this debate on the future of our high streets. I thank her for speaking so passionately on behalf of our constituents. I strongly agree with her comments about the importance of our high streets in tackling loneliness and connecting communities.
Without a doubt, the covid pandemic has wrought some heavy blows on both our high streets and our wider economy. As Owen Thompson said, changes that were already taking place before the pandemic have been magnified. We have seen profound changes to the way we shop, live and work right across the UK. None the less, we know that our high streets are resilient and adaptable, and we are committed to helping them not just recover but thrive and flourish in the weeks and months ahead.
That is why we have committed unprecedented levels of support and funding for high-street businesses throughout the pandemic—£352 billion in total, to help those negatively impacted by covid-19. That package includes £60 billion of business rates relief, business grants, the coronavirus loan schemes and the coronavirus job retention scheme, which has supported more than 90,000 jobs in Lewisham East, as well as the deferral of income tax payments. Another £2 billion was made available to local authorities in additional restriction grants, with councils encouraged to focus that support on the sectors that remained closed the longest.
Does the Minister think that the Government missed an opportunity when they introduced the plastic bags charge, which has produced millions? We were promised that the money would flow into communities and the regeneration of local towns, so why has most of that money flown into the back pockets of the supermarkets? Why can we not have that money to regenerate local businesses?
I fear that the hon. Gentleman is going to take us on a diversion. The tax has been hugely successful. It has eliminated billions and billions of plastic bags from our planet. We can take some of the other points that he raises offline.
In Lewisham, the support that we have introduced has equated to about £40 million in business grants to small businesses as well as those in the retail, hospitality and leisure sectors. Lewisham council estimates that it will have awarded £55 million in business rate relief to local businesses between March 2019 and March 2022. A further £34 million has been provided to the council in local restriction support grants and Christmas support payments. I am sure that the hon. Member for Lewisham East agrees that that funding was invaluable for businesses during an incredibly difficult 18 months.
Earlier this year, we also announced the £56 million welcome back fund, building on the success of the reopening high streets safely fund, to give people reassurance that they can shop and socialise in a covid-secure way. The hon. Lady is, I am sure, aware that more than £250,000 was awarded to Lewisham council through the welcome back fund. I am delighted that the local authority and businesses themselves have been able to take advantage of that support. My hon. Friend Cherilyn Mackrory talked about the benefits it brought in her constituency, too.
That funding has been complemented by a commercial property eviction moratorium, which has now been extended to
All that adds up to a concerted effort to protect businesses and livelihoods during and after the pandemic. As my hon. Friend Matt Vickers said, the Treasury has indeed thrown the kitchen sink at backing our high streets over the past two years. Even before covid-19, however, it is important to stress that the Government had demonstrated their commitment to supporting our high streets to embrace change, to respond to the evolving patterns of consumer demand, to create a vibrant, mixed-use town and city centres, and to drive investment in parts of the country that historically have been underserved.
Our future high streets fund, for example, supports 72 places from Wolverhampton to Woolwich, just down the road from the constituency of the hon. Member for Lewisham East, with a share of more than £830 million. That funding is being used by councils to deliver ambitious plans to regenerate high streets while helping them to recover from the pandemic.
More broadly, our towns fund is supporting 101 places to bring forward schemes to spur growth and to breathe new life into communities, while creating thousands of jobs. We can already see some brilliant examples of how that fund is helping to transform those towns across the country. Southport has turned its old theatre into a convention centre, a state-of-the-art venue, in an attempt to bring in more than 1 million new visitors every year.
Despite being a Huddersfield boy, I cannot take further interventions, because we are pushed for time.
In Worcester, support from our future high streets fund is being used to renovate several iconic and beautiful buildings, including the local corn exchange, driving footfall and preserving the community’s heritage. My hon. Friend Sara Britcliffe also talked about the good that such schemes are doing in her constituency. Those are the kind of transformative projects that hold the key to restoring local pride and laying the foundations for our long-term economic recovery. That is exactly what underpins our levelling-up fund, which will be available to local areas across the UK.
I am afraid I cannot take further interventions as I am a bit pressed for time. I am so sorry.
We will invest £4.8 billion in the levelling-up fund to build the next generation of roads, bridges, railway stations and 5G networks to connect communities and businesses faster than ever before. However, significant though such interventions and all that spending are, I think we all agree that, no matter the scale of Government investment, money alone cannot solve all the problems that businesses on our high streets face.
That is one reason why my Department has recently published the “Build Back Better High Streets” strategy, which has a bold and imaginative vision for the future of our high streets—a future in which businesses and communities have the freedoms and flexibilities to innovate and adapt to a new post-covid world. The strategy forms a key part of the Prime Minister’s plan to level up. It will deliver visible changes to local areas and communities across England, transforming derelict buildings, supporting businesses, cleaning up our streets, improving the public realm and supporting a renewed sense of community pride for future and current generations.
To enable places to adapt and to reinvent their high streets, the strategy builds on some of the earlier planning changes that we have already made. We introduced the temporary permitted development right for moveable structures so that pubs and restaurants could move the indoors outdoors using marquees and canopies. I am sure hon. Members across the UK will have seen the effects of that. We have acted to make it easier to host market stalls, car boot sales and fairs for longer, without needing a planning application. We are consulting on making those changes in relation to marquees and markets permanent.
In 2020, we made a use classes order creating a new class E, which gives businesses the freedom to adapt and reinvent themselves. An office can easily become a café, a shop, health surgery or nursery without requiring planning permission. To support high streets to become places where people shop and spend their leisure time but also live, we have created a new permitted development right that allows the creation of much needed new homes in the hearts of our towns and cities. This right helps to repurpose vacant buildings, avoiding premises being left empty for long periods. Our further permitted development rights allow buildings to be extended upwards to create new homes and the demolition of vacant and redundant shops and offices so that they can be replaced with quality homes right in the hearts of our towns and cities.
I again thank the hon. Member for Lewisham East for her excellent speech and all the other Members who contributed to this excellent debate. The Government remain steadfast in our commitment to help our high streets adapt and thrive as they recover from the pandemic so that they can play their part in levelling up communities across the country. Indeed, my Department, the Department for Levelling Up, Housing and Communities, has a fundamental role to play in delivering this agenda. I know that I speak not just for myself but for the whole of our ministerial team in saying that we are committed to working with Members from across the House to create the stronger, fairer, more united kingdom we all want to see as we emerge from the pandemic. We also want to work hand-in-hand with local authorities and businesses to make that vision a reality.
I have not had time to pick up on every point that hon. Members have made or all the excellent projects that they promoted during the debate, but I will be happy to do so offline afterwards. I hope that, together, we can ensure that our high streets remain the beating heart of our communities for generations to come.
I am grateful to everyone who has contributed to today’s debate. Many vital concerns have been raised. Cherilyn Mackrory talked about her thriving high streets, while acknowledging that there have been struggles and the need to improve rural and coastal areas. My hon. Friend Stephanie Peacock talked about the impact of the support that is needed for high streets because the pandemic has affected poorer areas, which cannot be denied, but also about the cuts that her council has experienced and the impact that that has had on her area. Lewisham council has also experienced significant cuts of £200 million since 2010.
Matt Vickers spoke about the decades of challenges for high streets and agreed about the need to tackle the outdated business rates regime and crime in high streets where shops have closed down. My hon. Friend Rachael Maskell spoke about high streets, closed shops and the need to bring life back to those areas. She spoke passionately about bringing families back into the area; where there are families and children, there is always a lot of spending because children make the wonderful demands that they do.
Sara Britcliffe spoke about the well-documented decline in high streets, which are a shadow of their former selves, and the loss of civic pride. I hope that those areas win the levelling-up funding they have bid for. Owen Thompson spoke about bank closures and said that money spent locally stays locally; I could not agree more. Jamie Stone also spoke about money needing to be spent locally; more significantly, he spoke about the astounding increase in electricity bills that hotels have received and how that desperately needs to be addressed. Again, I could not agree more.
My hon. Friend Alex Cunningham spoke about his excellent Labour council and the ambitious urban park development that is going on there—all gratitude to the council. Jim Shannon spoke about how high streets have suffered and how unemployment has increased. Alison Thewliss, whose area I know quite well, spoke about the loss of many big shops, but is confident that the city has a strong strategy for improvement.
There has been much agreement in the Chamber on many of the issues that I and others have raised, and we agree there is a need for the decline not to spiral out of control. The BBC reported that, in the first six months of this year, about 50 shops were closing every single day on our high streets. I sincerely hope that, when the statistics come in for the second half of this year, the circumstances will have changed.
I had hoped to hear the Minister talk about business rates and the review of business rates. That theme was very obvious in many of the speeches and in the questions that were asked. I hope that he will return to his Department and review this, because we need a modern form of taxation—one that means that businesses do not just survive but soar. I would like him to go back and produce measures to ensure that jobs are on the increase and strengthened and that entrepreneurs are rewarded. We all have high streets that we want to be proud of, in towns and cities and rural areas and coastal areas, and we all want to see continued improvements in our area.
Question put and agreed to.
That this House
has considered support for UK high streets.