High Streets and Town Centres in 2030

Helen Hayes Excerpts

Thursday 13th June 2019 Westminster Hall

[Helen Hayes (Dulwich and West Norwood) (Lab)]

I welcome this report, and add my thanks to the Chair of the Committee, the hon. Member for Sheffield South East (Mr Betts), and everyone who contributed to it.

Town centres and high streets matter because they are the hearts of our communities. They are the places where people come together to access goods and services, to meet each other and to enjoy leisure time. People often feel a strong sense of connection to their place and they enjoy local distinctiveness as part of their identity. People enjoy the relationships they have in their local town centres, with the shopkeepers and café owners who serve them, with the voluntary sector organisations they encounter, and with the public services that they can access in such locations.

Our report found that unlike in the 1990s, when high street decline was linked to the wider economic recession, and the threat of the internet was only beginning to loom on the horizon, the issues facing town centres now are much more fundamental and structural. I will high light a number of issues covered by the report that are affecting the town centres and high streets in my constituency.

Whether in West Norwood, East Dulwich, Brixton West Dulwich, Dulwich Village, Herne Hill or Crystal Palace, I am proud of the distinctiveness of the town centres and high streets in my constituency, the independent businesses, which serve their communities, and the sense of place and community, which they help to foster. Businesses in my constituency are really suffering. Rents in London are going up, and rents feed into the calculation of business rates. One owner of a hugely popular, much-loved local shop contacted me to say that following the recent revaluation, his rateable value had increased by 110%, and his bill by 34% once transitional relief had been applied. Added to that, he told me that he is being squeezed by increases in employers’ national insurance contributions and his rent. His turnover is substantially down as a direct result of online competition.

In West Norwood next week we will see the closure of the last bank in the town centre, when Barclays shuts its doors for the last time. That is a particular blow in an area with a high number of elderly and disabled residents, and one that will further increase financial exclusion in that part of my constituency and harm the wider town centre. Trade will be driven away as people go to other places for their essential banking transactions and choose to spend their money elsewhere.

The relaxation of permitted development rights is already a disaster, resulting in poor-quality homes in the wrong locations and no affordable housing or contribution to services and facilities. The good examples of office-to-residential conversion generally would have achieved planning consent in any event, so PDR has simply facilitated the delivery of poor-quality homes. For town centres, the Government have proposed further expansion of permitted development rights to enable shops to be converted to residential. That would be an unmitigated disaster for town centres. It is true that in many town centres there is too much retail space, but how and where to reduce that and introduce other uses is a strategic decision that should be taken by the local authority, in consultation with the community. Allowing landlords that freedom runs the risk of gap-toothed high streets up and down the country, rather than the sensible consolidation of a retail heart where it is needed.

Our report is right to identify the critical nature of strong local authority leadership in supporting healthy town centres, but planning departments have been cut to the bone under nine years of austerity. Thriving town centres need a strong vision, effective partnerships between councils, businesses and the community and investment in the public realm, increasingly with a focus on sustainability and climate change at their heart. We need to clean up the air in town centres, deliver safe routes for walking and cycling and create pleasant open spaces resilient to hotter summers and wetter weather. That simply cannot be done with current resources. Government must invest in and empower local authorities to play the leadership role on behalf of our towns centres that we know can be so effective.

I want to return to the issue of business rates. A fundamental problem for our town centres is that business rates do not reflect the value that people place on their local high street. They penalise town centre retailers in more expensive property, to the benefit of internet-based businesses operating out of low-value warehouses. It is the job of the taxation system to redistribute resources according to the public goods that communities value. Town centres are one such public good. The value of the relationship that an isolated elderly person has with their local shopkeeper does not appear on any balance sheet. Our taxation system must take account of that value and redistribute resources to serve our town centres.

It is for the Government to provide the policy and taxation regime that can support our town centres, whether by creating an obligation for banks to provide branch-based services in every community in the country, redistributing businesses rates to support our town centres or investing in our local authorities to equip and enable them to play a leadership role. The Government are not doing enough; they must show more leadership.

--- Later in debate ---

[Mrs Wheeler]

The hon. Lady is obviously prescient. When the Government concluded the last fundamental review of business rates, we decided to keep business rates as a property tax, following stakeholder responses. Respondents agreed that business rates are easy to collect, difficult to avoid, relatively stable and clearly linked with local authority spending. Some respondents suggested alternative tax bases. However, Select Committee members and others may wish to know that there was no consensus on an alternative base, and that even those respondents who put forward alternatives were clear that they were not without issues. To finish on business rates, the Government are committed to listening to views and will keep all taxes under review.

[Helen Hayes]

Will the Minister give way?

[Mrs Wheeler]

I have not got time.

[Helen Hayes]

I will be extremely brief. This issue is killing businesses across the country now. I am afraid that saying the Government generally keep it under review, along with all other taxes, simply does not cut it for businesses in our town centres.

[Mrs Wheeler]

I have outlined how the Government are helping local businesses with many, many millions of pounds, and with £6 billion-worth of relief, so I think the hon. Lady is slightly over-egging it.

Another issue that has been highlighted is our undertaking a planning consultation on permitted development rights to help support change on the high street. Permitted development rights continue to play an important role in the planning system, supporting key Government agendas such as housing and high streets by providing more planning certainty while allowing for local consideration of key planning matters.

To put the hon. Member for Sheffield South East’s mind at rest on local plans and permitted development rights, where a local planning authority considers it necessary to protect a local amenity or the wellbeing of an area, it can consult the local community by removing a right by making an article 4 direction. Proposals for development can change, and a change of use would require a planning permission application.

Equally, on the point from the hon. Member for Dulwich and West Norwood (Helen Hayes) about poor quality homes being delivered through permitted development rights, permitted development rights have actually provided 46,000 really important homes that needed to be built. However, we are particularly keen to ensure that the quality of all new homes meets our ambitions, so in the spring statement we announced a review of permitted development rights for the conversion of buildings to residential properties, in respect of the quality and standard of homes.

Because the Government believe in the high street, we run the Great British High Street awards, with Visa, to celebrate the achievements of our communities and high streets. The awards are a great way of bringing together local players and focusing minds on high streets. In entering the awards, local authorities, businesses and communities work together and get local people talking about their high street, letting local leadership emerge. Last month, I was delighted to launch the 2019 competition in Crickhowell, the town that took the top prize in 2018. I am sure that Committee members will join me in wishing this year’s entrants the best of luck.

We encourage all those with an interest in high streets, particularly landlords and retailers, to consider how they can take the Committee’s recommendations on board in their own decision-making processes. We agree wholeheartedly with the Committee that the elements raised today form part of a bigger whole.

This is a package of interconnected measures to help local areas make their high streets and town centres fit for the future. The different elements will work together to have a real impact on high streets and town centres in adapting and evolving and in becoming vibrant hubs once again. I believe that the benefits of this will be felt more widely, helping to deliver local growth and real change in our communities. This growth will be shaped by the Government’s industrial strategy, which sets out the long- term plan to boost productivity by backing businesses to create good jobs and will increase the earning power of people throughout the UK with investment in skills, infrastructure and places. I once again congratulate the hon. Member for Sheffield South East on securing the debate, and I thank hon. Members for their speeches and questions and the Committee for its helpful recommendations.

My local high street in Swadlincote is thriving, my wonderful South Derbyshire District Council has no car parking charges in any of its council car parks, and we moved the market back down the high street, making it a vibrant place to be. I am sure that, as the hon. Member for Dunfermline and West Fife (Douglas Chapman) said, we all have marvellous examples that show how our high streets can get back to being the best places that they can be. The challenge of rebalancing the functions of our high streets and town centres is a real priority for us across the nation. Having adapted successfully before to new demands, we believe that places can and will do so again.