High Streets

Barry Sheerman Excerpts

Tuesday 19th October 2021 Westminster Hall

[Janet Daby]

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?

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

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?

[Janet Daby]

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 The current system of business taxation is outdated and unfair.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.”

Kate said:

“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.

--- Later in debate ---

[Cherilyn Mackrory (Truro and Falmouth) (Con)]

It is a pleasure to serve under your chairmanship, Ms Nokes, and I congratulate the hon. Member for Lewisham East (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.

[Mr Sheerman]

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?

[Cherilyn Mackrory]

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.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Neil O'Brien)]

It is a huge pleasure to serve under your chairmanship, Ms Nokes. I congratulate the hon. Member for Lewisham East (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 the hon. Member for Midlothian (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.

[Mr Sheerman]

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?

[Neil O'Brien]

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 the Member for Truro and Falmouth (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 25 March 2022, helping high street shops hit hard in recent months to stay afloat and weather the storm. To provide more certainty to tenants and landlords, the Government plan to legislate for a process of binding arbitration, following a call for evidence launched in April and engagement with business owners. The legislation will ringfence debt relief accrued from March 2020 for commercial tenants impacted by covid-19, and it will introduce a system of binding arbitration for landlords and tenants that cannot agree between themselves on agreeing, deferring or waiving rent arrears.

All that adds up to a concerted effort to protect businesses and livelihoods during and after the pandemic. As my hon. Friend the Member for Stockton South (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.

[Mr Sheerman]

Will the Minister come to Huddersfield to—

[Neil O'Brien]

I am afraid I will take no further interventions—[Interruption.]