High Streets and Town Centres in 2030

Chi Onwurah Excerpts

Thursday 13th June 2019 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a pleasure to serve under your chairship, Mr Stringer. I thank the Committee, its members and its staff for the excellent report. I congratulate my hon. Friend the Member for Sheffield South East (Mr Betts) on securing this debate and on his opening remarks, which were wide-ranging, informative and comprehensive, as well as excellently delivered. I thank all the hon. Members here for a reasoned debate, delivered in a good atmosphere, considering shared concerns about the future of our high streets at this important time.

This week, Arcadia, one of the biggest retailers in the country, narrowly avoided a collapse, which would have put 18,000 jobs at risk. Even so, Arcadia workers still face 50 shop closures and 1,000 job losses; my hon. Friend the Member for Bedford (Mohammad Yasin) highlighted some of the impacts of that on his constituency. Arcadia will not be the last retail group to struggle. Too few retail magnates have not given sufficient thought to the long-term sustainability of their retail groups, leaving workers and consumers to pay the price. Mike Ashley is as successful in his self-proclaimed role of saviour of the high street as he was in selling Newcastle United. The Business, Energy and Industrial Strategy Committee has compared working conditions in Sports Direct to “a Victorian workhouse.” That is not the kind of high street we want to see.

As my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) highlighted, the identity of our town centres is wrapped up with the retail sector, which is the largest private sector employer in the UK, employing one in 10 of our workforce. When I walk down Northumberland Street or through Eldon Square in Newcastle and see the vibrant mix of consumers and traders, I am grateful that my city centre appears to be weathering a very difficult trading environment; but that cannot be said for all cities and especially not for our towns.

Indeed, as this report highlights, there are often differences within towns. My hon. Friend the Member for York Central (Rachael Maskell) spoke about some of the innovative practices that some businesses on her high street were using to attract more foot flow. In Newcastle, Grainger market, our Victorian gem, is putting on tea parties and gastronomic delights in order to do the same thing.

What this review tells us is that, if our town centres are to survive to 2030, they must be grounded in community. Local authorities have a responsibility for the economic and social wellbeing of the places and communities they serve, but the scale of the issue demands action from central Government to ensure that our local authorities have the necessary powers to do their job, as hon. Members on both sides have emphasised. That must be backed by proper funding—much, much more than the pitiful £1.2 million put into the regeneration pilot in 2017. Our high streets and town centres anchor our local economies and offer jobs, services and a sense of place, but that is declining year on year. Every retail location type—high streets, retail parks, shopping centres—saw the number of occupied units decline at a faster rate in 2018 than in 2017. The high street vacancy rate rose from 11.2% to 11.5%; in retail parks it jumped from 4.9% in 2017 to 7.1% in 2018. There are 50,000 empty shops in the UK. In shopping centres, 6% of empty space has been empty for two years. On the high street, that figure is 5%. There have also been more than 100,000 job losses in retail over the past three years alone.

Some people say it is inevitable that online shopping will kill the high street, but it is wrong to think that the rise in internet retail equals empty shops and job losses. The impact of technology on our society involves political choices, and in this case the impact is due to Government inaction. As we see in this report, many shoppers still enjoy shopping as an experience; the most successful high streets are those with a good mix of retail, leisure and services, which provide a vibrant community space, not just a collection of businesses.

Under this Government, we have seen chronic under-investment in infrastructure, particularly outside London and the south-east. For example, the north-east receives less than one third of London’s transport spending per capita. According to the Local Government Association, outside London we have lost 117 million miles of bus routes—nearly half of all council-subsidised services—since Tory austerity began in 2011.

Every month, 60 bank branches and 250 free cash machines close, with devastating effects on access to cash in rural areas, and despite repeated promises to safeguard our post offices, we face 2,500 potential closures over the next year. We welcome today’s announcement by UK Finance that the banking sector will work to support people’s free access to cash, but it is not enough. Will the Minister take note, follow Labour’s lead and ban automated teller machine charges?

This Government have not only failed to take action but repeatedly ignored their own warnings. Despite the recommendations of this report, they have chosen to extend permitted development rules, which, as we have heard from many hon. Members, can effectively depopulate town centres in the day, which has an impact on retail and restaurants and makes it harder to enforce high standards for new homes. Will the Minister take note and suspend any further extension of permitted development, as hon. Members have called for?

In their response to this report, the Government refuse to recognise that online retailers should be contributing more. The system is past its sell-by date, having been

“designed in 1990, when businesses made money in a very different way.”

Those are not my words, but those of the Conservative Mayor of the West Midlands, Andy Street, who understands that high street retailers are being crippled by an outdated business rates system and has called for online retailers to pay more tax—as indeed have hon. Members such as the hon. Member for Hertford and Stortford (Mr Prisk) today.

The Tories have failed our high streets, failed our retail sector, and failed our economy. They have no claim to be the party of business. As the hon. Member for Dunfermline and West Fife (Douglas Chapman) highlighted, a no-deal Brexit would be catastrophic for businesses, extending that failure and wrecking many of the businesses on our high streets and in the retail sector. I ask the Minister to rule out a no-deal Brexit—[Interruption.] I am sure it is within her pay grade to do that. Will she at least say that she will not support a Conservative candidate who supports a no-deal Brexit?

Labour’s industrial strategy will rebuild our economy for the many. Unlike this Government, we care about every part of the economy. As part of our “innovation nation” mission, we will raise productivity and job quality in sectors such as construction, agriculture and retail that have been wholly neglected by the Government’s industrial strategy. Labour would fund a new catapult centre to boost the take-up of innovation in the retail sector, creating higher wages and better jobs on high streets across the country.

Our high streets are reaching crisis point, which is why Labour has an emergency five-point plan to resurrect and rebuild our town centres. I will finish with that plan. First, we will ban ATM charges and stop post office and bank branch closures. Secondly, we will provide free bus travel for under-25s. Thirdly, we will roll out free public wi-fi in town centres, so that we have networked centres that encourage people to spend their time as well as their money. Fourthly, we will establish a register of landlords of empty shops in each local authority, making it easier to bring shops back into use. Finally, we will introduce an annual revaluation of business rates, ensure a fairer appeals system and review the business rates system to bring it into the 21st century.

Labour’s plan will revive and reinvigorate our high streets, which must urgently adapt. We will take the urgent action required; will the Government follow in our plan and commit real resources to ensuring that our town centres can survive and thrive?

[Graham Stringer (in the Chair)]

Before I call the Minister, I will say two things. First, my notes said that the Minister was Kit Malthouse, but you are no less welcome for being unexpected, Minister. Secondly, can I ask you to leave a short space of time at the end of your speech for the Chair of the Committee to wind up?