Town Centres

Tuesday 7th January 2025 Westminster Hall

16:00

[Valerie Vaz (in the Chair)]

I will call Luke Murphy to move the motion and then the Minister to respond. There will not be an opportunity for the Member in charge to wind up, as is the convention for a 30-minute debate.

[Luke Murphy (Basingstoke) (Lab)]

I beg to move,

That this House has considered Government support for town centres.

Thank you for the opportunity to lead this important Westminster Hall debate on the future of Britain’s town centres under your chairship, Ms Vaz. Like so many towns across the UK, my constituency of Basingstoke is grappling with the consequences of years of neglect under successive Conservative Governments and the changing habits and shopping trends of consumers. High streets have suffered from an array of pressures, made worse, not better, by the policies of the previous Administration.

For more than a decade, the Conservatives failed to modernise the business rates system, leaving small businesses disproportionately burdened while allowing major online retailers to shirk paying their fair share. The failure to secure our energy supply and tackle retail crime, and the disastrous mini-Budget, which sent interest rates soaring, stifled the ambitions of our high street businesses, leaving them grappling with higher costs and a lower footfall.

[Jim Shannon (Strangford) (DUP)]

I am sorry, Ms Vaz, but the hon. Gentleman said to me, “Get in early,” so I have taken him at his word and done as he asked.

The hon. Gentleman has clearly outlined the issues for his own town centre. In the past, the Government here gave the devolved Administrations and institutions money sensibly. I know the Minister will respond to this when the time comes. They also did that through the levelling-up fund, so money did come through. Does the hon. Gentleman agree that more needs to be done to promote the economic and social regeneration of disadvantaged areas? After all, this is the great United Kingdom of Great Britain and Northern Ireland. We are always better together, so we should be helping each other.

[Luke Murphy]

I think it was the hon. Gentleman who suggested that he might come in early, but I thank him for his intervention. I agree, but I will leave it to the Minister to respond more fully. I will take interventions from a number of Members. I am grateful to those who made it clear in advance that they wish to speak. I will try to get to them first, and I will do my best if others want to come in, but I am conscious that we do not have a huge amount of time.

Because of the issues and trends that I have highlighted, Basingstoke’s Festival Place shopping centre now contends with long-term vacancies. Some of the largest storefronts, such as the old Debenhams building, have sat empty for years. All too often, new businesses open their doors with optimism in the Top of the Town, but they find themselves shuttered within a matter of months.

After 14 years of Conservative Government, Britain’s high streets and town centres have been hollowed out. According to the Centre for Retail Research, more than 10,000 shops closed in 2023 alone. The high turnover of shopfronts leaves not just holes in the high street but a sense of instability that undermines confidence in the local economy, yet amid the challenges there is undeniably an opportunity to breathe new life into our high streets.

[Sarah Dyke (Glastonbury and Somerton) (LD)]

I thank the hon. Gentleman for giving way and for securing this really important debate.

Rural market towns are really important. In my constituency of Glastonbury and Somerton, Wincanton would benefit massively from regeneration. In fact, it was due to receive a considerable amount of funding—£10 million. The council put together a strong bid, but the former Member was unable to support it. Does the hon. Gentleman agree that encouraging regeneration in our town centres and boosting footfall is the best way to bring prosperity back to our rural market towns?

[Luke Murphy]

I fully agree, but I will leave it there—for the sake of time, I will be short in agreeing with interventions.

None the less, like many towns and villages across the country, Basingstoke’s town centre is a hub of remarkable independent businesses that continue to thrive, despite years of neglect, from the unique offerings of Afrizi and the cherished Willows to the flavours of the Chennai Express and the ever-popular Festival Street Kitchen. These diverse ventures highlight the incredible entrepreneurial spirit in our town. The wealth of talent and creativity showcases the untapped potential of small business owners in our town, who deserve greater support and investment.

[Jo Platt (Leigh and Atherton) (Lab/Co-op)]

My hon. Friend is making some excellent points about our high streets. The Government’s recent move to introduce high street rental auctions is a game changer for places such as Leigh and Atherton. Local businesses such as local construction firm WJ Structures are eager to regenerate, but are often held back by obstructive landlords. Does my hon. Friend agree that empowering businesses with a genuine stake in the area will only boost the local economy? It will create jobs and foster skills and training for industry in communities such as mine.

[Luke Murphy]

I fully agree with my hon. Friend and look forward to seeing auctions playing a role in rejuvenating high streets such as those in Basingstoke and in her constituency. I also welcome the Government’s action on small business access loans in the Budget, with £250 million for the British Business Bank’s small business loan programmes.

We know that the high streets of tomorrow will not look like those of the past. The modern consumer is looking for more than a place to shop. They are looking for an experience, and a reason to visit that goes beyond everyday retail. Independent, forward-facing business owners such as those running the Dice Tower and the Post Box in Basingstoke, which provide engaging experiences alongside the food and drink offerings, show that they already understand the habits of their customers. Events and experiences are clearly the future of the high street.

Innovation is the way forward for our town centres. A shift towards more diverse, mixed-use developments, integrating housing, leisure, culture, banking hubs, centres of education and public services, will help to create more vibrant high streets where people want to spend time and money. Alongside innovation, we must also address the factors that deter footfall.

[Alistair Strathern (Hitchin) (Lab)]

My hon. Friend is making a powerful case for the importance of regenerating our high streets with a new modern vision for their success. Does he agree that, for them to be successful, they must be seen to be safe? That is why it is so important that this Government do not tolerate, as the last Government did, a rise in antisocial behaviour and retail crime. A strong neighbourhood policing presence is required to assure residents that our high streets really are there for them, safely, when they need them.

[Luke Murphy]

I totally agree with my hon. Friend—I was just about to come on to that point. Antisocial behaviour and retail crime remain significant barriers to a thriving town centre. I am sure that businesses in his constituency have shared with him, as those in mine have shared with me, their frustrations over theft, vandalism, drug use, knife crime and things like illegal car meets. These are not merely nuisances; they are economic threats that drive shoppers away and force businesses to close. Labour’s plan to tackle these challenges head on—with robust action to tackle antisocial behaviour, stronger powers for local police and more town-centre policing, as well as support for businesses to invest in safety measures—is critical to restoring confidence in our town centres.

Since 2014, our police force has been diminished and retailers have been left to fend for themselves against the so-called low-level crime of shoplifting, which we know is absolutely nothing of the sort. It wrecks the bottom line and puts staff and shoppers in harm’s way.

I am glad to see the Government tackling shoplifting by reversing the rule under the previous Government that meant that the police would not usually investigate shoplifting of goods worth less than £200. Only by putting more police on the streets and empowering them to tackle shoplifting and antisocial behaviour can this Labour Government truly bring consumer and business confidence back to town centres like ours in Basingstoke. I would welcome an update from the Minister on the recent work in his Department to support high street businesses that continue to be victims of antisocial behaviour and retail crime.

The recent Budget provided £1.9 billion of support to small businesses and the high street in the next financial year by freezing small business multipliers and providing 40% relief on bills for retail, hospitality and leisure properties, up to a £110,000 cash cap. I welcome those measures, but would also be grateful if the Minister updated us on the progress of the Government’s plans to deliver the promised permanent reform of business rates. This is an absolute key issue that is raised with me time and again whenever I am in the Top of the Town.

[Sorcha Eastwood (Lagan Valley) (Alliance)]

I agree with the point that the hon. Member has just made. Does he agree that businesses are facing not just a cost of living crisis, but a cost of doing business crisis? In my constituency, a restaurant called Huxo, which only opened a year ago, has unfortunately had to close—he referenced that issue in his own constituency. Does he agree that it would be useful to hear from the Minister what the Government intend to do to help our local businesses with the cost of doing business crisis?

[Luke Murphy]

Absolutely, and this is something that we have seen businesses plagued with over the last 10 to 14 years. It is really important that, as well as improving footfall and stabilising the economy, we tackle those costs facing businesses.

During the election campaign, the Prime Minister and the businessman Theo Paphitis visited Gabardine Bar together—a fantastic independent business in my constituency. It is great to see Kevin and Fran, who run Gabardine, here with us today. They represent exactly the kind of small business owners we have to support—ambitious for their own business, but also for the Top of the Town and Basingstoke as a whole. I rarely have a chat with Kevin that does not include a new idea, not just for his own business, but for rejuvenating the town centre.

[John Slinger (Rugby) (Lab)]

Hearing about my hon. Friend’s constituents and the great work they are doing reminds me of the excellent work happening in my own constituency of Rugby around the night-time economy and live music, particularly in places such as Inside the 22, which provides live music, and The Squirrel Inn. Does he agree that this shows that small businesses are very entrepreneurial? They have the ideas about how to regenerate their own towns; what they need is an empowering ecosystem, which I believe is what the Government are seeking to create.

[Luke Murphy]

I completely agree with my hon. Friend. It is just those kinds of entrepreneurial businesses that are seeking a better future not just for themselves, but for the town as a whole. We must create a supportive environment for them. Like many local businesses, they are community minded at The Gabardine—they put on food and refreshments for the recent local remembrance activities—but they need to operate in a stable economic environment, which is why I welcome the recent Budget to protect the smallest businesses and shore up our economy.

It is also important that the Government deliver on securing our energy supply, with a credible plan to increase the availability of cheap, clean, home-grown sources of power through Great British Energy. I would value knowing what more the Government can do, and are planning to do, to support high street businesses in Basingstoke and elsewhere, which have been crippled by the weight of soaring energy costs.

One of the other issues raised with me by local businesses is about reliable bus routes and public transport. These are essential for driving footfall in towns such as Basingstoke. The Government’s plans to allow public transport to be put into local hands is a welcome step towards ensuring that every town and village has the bus services and public transport access that it needs.

[Mr Bayo Alaba (Southend East and Rochford) (Lab)]

I thank my hon. Friend for securing this debate. One in seven shops are empty—I have noticed that in my constituency, and the situation is similar in many constituencies across the country. Many owner-operators, like some of my hon. Friend’s constituents here today, want to get their town centre going again. They know what is best. The communities that bounced back the quickest after lockdown had owner-operators at the front and centre. Does my hon. Friend agree that the Government should be trying to provide infrastructure such as buses and routes to enable entrepreneurs and community stakeholders to get their communities back and vibrant again?

[Luke Murphy]

I completely agree with my hon. Friend. Public transport plays a role in making town centres accessible, but we must think about the wider need for infrastructure that supports all modes of travel, to ensure that additional footfall to support entrepreneurs such as Kevin and Fran.

Central to this debate is the recognition that town centres are not just about bricks and mortar, but ultimately about people. When my neighbours visit the Saturday market at the Top of the Town, I want them to see a bustling town centre with plenty to offer—somewhere they want to keep coming back to.

[Tom Hayes (Bournemouth East) (Lab)]

I thank my hon. Friend for securing a debate on this issue. Bournemouth town centre has just had a very busy Christmas period. We had fantastic Christmas lights funded by the Bournemouth town centre business improvement district. We have also had the successful opening of The Ivy, which is fantastic. Otherwise, the town feels like a ghost town. Does he agree that the roll-out of the high street rental auctions, for which Bournemouth is a pilot area, could be critical to restoring confidence in our high streets, increasing footfall and making our town centres safer? Ultimately, that will help more businesses to grow and help our local economy.

[Luke Murphy]

I completely agree. I look forward to seeing the role that those auctions can play in Bournemouth and elsewhere, and to seeing them rolled out in places like Basingstoke as well; they are a really exciting innovation.

I want our town centre to be a vibrant place that people keep coming back to. The opportunity is there, but it will take the Government, local authorities, and our communities and businesses to work together to realise that potential. Last year I stood on a Labour manifesto pledging to breathe new life into our high streets, and in February I committed to hosting the first Top of Town summit in my constituency of Basingstoke as a step towards achieving this collaboration. I hope the Department will support efforts in constituencies like mine to break down the barriers that stand in the way of local economic growth.

I hope the Minister will agree that delivering a boost to town centres like Basingstoke’s through tackling antisocial behaviour, retail crime, the scourge of empty shop fronts and soaring energy prices, and reforming outdated business rates, must be a priority for the Government if we are serious about reaching our milestone on growth in a way that improves local economies, builds up small businesses and puts more money in people’s pockets.

I would welcome—as would Basingstoke business owners like Kevin and Fran, who are here today and who met the Prime Minister during the election campaign —any updates that the Minister can provide on the work that the Government are doing on these issues.

16:16

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Alex Norris)]

It is a pleasure to serve under your chairship, Ms Vaz. I thank my hon. Friend the Member for Basingstoke (Luke Murphy) for securing this important debate and for the spirit in which he has led it. Despite this being a half-hour debate—one of the shorter ones—the interest from colleagues, shown through interventions and through being here to listen, demonstrates the importance of town centres and their health to all our communities, wherever we are across the UK.

My hon. Friend’s diagnosis of the challenge was really well put, because although no two town centres are the same, all our town centres face the same problems: lower occupancy rates and footfall due to economic headwinds and changing consumer habits; the legacy of austerity on public amenities; and hollowed-out high streets becoming a breeding ground for crime and antisocial behaviour, which then feeds a vicious cycle that affects the confidence of consumers and investors alike. That is true in Basingstoke, it is true in Bulwell in my constituency and it is true in the constituencies of colleagues across the room. This is an important debate for us all—it is a significant debate for the Government of the day and for Parliament.

I was struck by what my hon. Friend the Member for Basingstoke said about the entrepreneurial spirit in his community, which was echoed by my hon. Friend the Member for Rugby (John Slinger). As we see across the country, there are brilliant business owners who are taking risks, bringing their ideas forward and making them real under very difficult circumstances. Quite rightly, they are not looking for the Government to operate their enterprises, but they are looking for the Government to make their life easier, which is entirely reasonable.

Today I will cover the points made by my hon. Friend the Member for Basingstoke and talk about some of the support that will be coming from the new Government. I will also reference that critical underpinning—that whatever we do, whatever support we give to business, and however good the trading environment, we have to have safe communities. If we do not have those, even if we have all the other pieces, people will still not feel safe and will not be able to visit their town centres, and businesses will not be able to thrive.

I will start with the high street itself. My hon. Friends the Members for Leigh and Atherton (Jo Platt) and for Bournemouth East (Tom Hayes) referenced high street rental auctions, so I will start there. In December we brought forward new powers for local authorities to require landlords who have persistently vacant properties to bring those properties back into use. The new regulations will make the tenancies more accessible and affordable for tenants, and give local businesses and community enterprise a right to rent valuable space on their high street. We are calling time on those persistent vacancies, and this will be a significant development in reducing vacancies and improving footfall along the way.

We have heard about the work going on in Bournemouth. We are also working with Bassetlaw, Darlington and Mansfield as early adopters, and I want as many areas to come forward as possible. I encourage colleagues to talk to their local authorities about getting the best out of these powers. There is also a lot of insight that we can support them with centrally. If they lean into this, it could be a really good way of addressing vacancy rates and of giving business and local community enterprises their first steps.

We will continue to invest in the high street accelerator model and from that learn what else we can do to improve communities across the country. As my hon. Friend the Member for Basingstoke mentioned, that model is telling us a lot about partnership between local communities, businesses, and property owners, who want to see their communities thrive. We also heard about business improvement districts convening that family of interested parties to drive forward a shared vision for an area.

At the moment, the overheads are really challenging—the hon. Member for Lagan Valley (Sorcha Eastwood) put it very elegantly as the “cost of doing business crisis”. As the Government of the day, we want to help and to ameliorate that situation. Retail, hospitality and leisure form the backbones of our high streets, and support our local economies and communities, providing jobs and attracting visitors, but they cannot do that with a chokehold on them, as my hon. Friend the Member for Basingstoke said. He asked for more specifics on permanently lowering tax rates for such ventures. From 2026-2027, we intend to introduce permanent tax cuts for those with rateable values of less than £500,000. Those businesses will have certainty going forwards, not having to wait from Budget to Budget to see if cuts have been maintained; they will be baked in. Indeed, I believe that legislation has been making its way today. It means that businesses will have certainty around costs, so that they can plan and can operate their businesses in a profitable way.

There are other ways in which we can make life easier, including by tackling the scourge of late payments and long payment terms. That is a theme we hear constantly when we talk to small business and self-employed people. We are therefore introducing a new fair payment code, and we want people to engage with it to make sure that it works for real—for the way in which they do their business—and they are not caught in the ripple effects of bigger organisations that do not pay on time. That is an important point on support.

We heard from my hon. Friend the Member for Basingstoke about the importance of energy costs, which we know have been a problem domestically and for businesses. There are businesses now that were in a cycle of contracting when markets were at their most challenging and which are now locked into longer deals. We encourage businesses or non-domestic organisations to engage with suppliers about moving away from contracts agreed at higher prices and instead move towards approaches such as blend and extend contract to try to reduce costs. That would give short-term relief.

What we have to do in the medium and long term—as my hon. Friend the Member for Basingstoke said—is transition away from fossil fuels and towards home-grown, clean energy through the establishment of Great British Energy. In December, we took steps with our 2030 action plan, outlining our efforts in this regard. That will mean there will be access to clean, green energy, and that there will be domestic jobs and more money in people’s pockets—the single biggest problem affecting my town is that people simply do not have enough money in their pockets to shop. We will be winning each way: keeping bills down with better energy, and putting support and vitality back into our communities with jobs too.

My hon. Friend the Member for Basingstoke mentioned transport, as did my hon. Friend the Member for Southend East and Rochford (Mr Alaba). Reliable bus and public transport services are vital to the economic success of our high streets. At the back end of last year, we made announcements about the £5.7 billion long-term transport settlement to transform the local transport networks of our largest city regions, helping to drive growth and productivity, and perhaps bringing back into use those routes that have been lost. There is also a further £650 million for local transport outside city regions in the forthcoming year, to make sure that we can improve connections between our towns, villages and rural areas as well as our major cities. On 17 December, we introduced the Bus Services (No. 2) Bill, which will put power over local bus services back into the hands of local leaders, so that those decisions reflect the nature of the local community and public transport gets to the right places.

On driving footfall and making sure that the high street has the amenities that our constituents want and need, we are also pushing hard on the roll-out of banking hubs. I know, having talked to colleagues, that that is of significant interest across the country. We have plans to roll out 350 such hubs, and there is plenty of work to do on that. Again, this is about having anchors on the high street that mean that people routinely come in and out of their town centre and, while they are there, perhaps go for a cup of tea or whatnot. We need those staples come what may, and that is an important way of making sure that we protect banking.

The hon. Members for Strangford (Jim Shannon) and for Glastonbury and Somerton (Sarah Dyke) talked about some of the ways in which Government have funded projects previously. To be clear—I could speak for another hour on this—we want to move away from the competitive, beauty parade-style bidding process that has pitted communities against each other, created a lot of disappointment and, frankly, been less than the sum of its parts. Our approach to local growth funding will be more integrated settlements over the longer term, with less central direction and more local choice. We think that will get the money to the areas that need it. In the meantime, we have the UK shared prosperity fund and the transition year there. I know that that is important for Northern Ireland—I have had the chance to see some of the services it pays for there—and across the country. Colleagues can look for more information about that when we get to the multi-year spending review later this year.

In the time remaining, I will move on to a couple of points about safety in town centres, raised by my hon. Friend the Member for Hitchin (Alistair Strathern). As the Chancellor’s Parliamentary Private Secretary, he is surely our man with a direct line on the spending review and other things. The point about safety is so important. My hon. Friend the Member for Basingstoke has, like me, raised the issue of car meets. This has, at times, really dogged my town, making me want to tear my hair out. In order to push these kinds of behaviours out of our town, we have had to chase them and really be on top of it. The issue has caused misery and anxiety, and people do not want to leave their houses because they do not think they are safe. That is also true for crime in town centres more generally.

My hon. Friend the Member for Basingstoke mentioned that terrible phrase, which I absolutely hate: “low-level crime”. The previous Government ceded ground around theft below £200, which has led to an explosion of stealing and other types of antisocial behaviour in our towns. That has made working in a retail environment a misery for people at times. We see staggering levels of violence, which we have to address. That is at the core of our safer streets mission, and we are committed to restoring neighbourhood policing through our neighbourhood policing guarantee—13,000 more police and police community support officers as a visible deterrent.

My hon. Friend also asked about timelines and where we are in the process. On 5 December, the Prime Minister announced our Plan for Change, which committed to a zero tolerance approach to ASB. That means a dedicated lead officer in every force, working with communities to work up a local antisocial behaviour plan. There are also our recently announced respect orders, which will give police and local council stronger enforcement powers, so that proper action is taken to change the behaviours of people who are persistently disruptive—others in our towns could name those people, and retail workers certainly could. This means banning them from the amenity they are disrupting, but also tackling the root cause of their behaviour through, for example, mandated alcohol and drug treatment. If people break respect orders, there are significant penalties, with offenders facing up to two years imprisonment—a real deterrent.

We want to tackle the root cause. For time out of mind, the behaviour of young people around town centres has been a challenge, whether they are on bicycles or causing shopkeepers challenges. Through our young futures programme, we want to give young people a positive thing to do, but it is also a chance to tackle and reduce offending where it happens. Together, all these things will make our communities safer for people to live, work and visit.

I am coming to the end of my speech, so I will probably leave it there. There are important points to be made about housing and our role in ensuring that, as more housing is created in town centres, it is done in a sensible and planned way with local communities. I think most people would accept the value of that—but if there is not proper planning and co-ordination, we end up with units in different places, as well as the weird and desperately sad situation where people move next door to a pub that may have been there for many years and then put in public order and nuisance complaints, leading to the pub closing down. We have to plan these things, so that residents can live alongside business in a way that promotes all of their interests.

To conclude, the interest that my colleagues have shown means that we could have gone on for a very long time. I thank my hon. Friend the Member for Basingstoke for securing the debate; it is a really brilliant way to start the new year. Our town centres are the beating hearts of our communities, and the Government are committed to giving that support. We will continue to engage with business to make sure the things we are doing are reaching the places they need to, and we will also work on that with our parliamentary colleagues. There is an awful lot to consider in terms of business support and public safety, so now is the time to grab this for our town centres—for my community, and for all of our communities. I think we can make a real difference.

Question put and agreed to.