John Pugh
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John Pugh (Southport) (LD)
I congratulate the hon. Member for Rochdale (Simon Danczuk)on having introduced the debate with his usual cheery optimism, in a slightly more partisan way than he needed to. I must apologise to you, Mr Davies, because I am moonlighting from the Finance Bill and might have to return there before the final summing up. I have another colleague here in a similar situation—the Whips should not be informed.
On Sunday I had a very optimistic experience. I was in a small street in Southport called Wesley street, where the traders have suffered for some time, blighted by shops not being filled and worries about custom. They have done a great deal for themselves, including painting their shops in contrasting vibrant colours. On Sunday they had organised a festival. They had put a green swathe down the middle of the street and a series of events was taking place. The place was absolutely buzzing. That group of traders have had the courage and initiative to reinvent themselves, and that is what we need in the high street.
The high street must, in a sense, reinvent itself. Certain pressures are not due just to the coalition Government, as might be supposed from the opening contribution. They are due to fairly long-term things, such as changes in shopping and working habits, the fact that we are living in an age of austerity and there is generally less money around and less profit for companies, and the fact that the drift out of town continues. Overwhelmingly, they are due to the threat of the internet and the fact that people can now shop at any time of the day or night. In some places, including my own constituency, the pressures are also due to the threat from increased mega-retail development—as I call it—such as at Liverpool One, Bluewater and the Trafford centre.
People look at what is happening on their local high street and see it as a kind of blight. They regret the lack of vitality. They look at the empty shops, and believe that something must be done. That is apparent, but what is not is what must be done. Some things clearly will not be done. The clock will not be put back, the internet will not be abandoned—people will use it more—and people will continue to change their habits. We cannot roll back to the 1960s.
Above all, the high street cannot buck the markets. Certain things are thriving. In the high street, things that may be undesirable, such as charity shops, and payday loan and cash register companies, are thriving in the current regime. Nail bars seem to do extraordinarily well in my neck of the woods, and coffee shops are in wild abundance—no one need be short of caffeine in any part of the UK as far as I can see. Building societies are also there, but they are a rather dull and sober presence. Most of the general public do not see that as satisfactory, and they say that something must be done. But it is not obvious what must be done, or who will do it.
Businesses are doing something anyway—they are pulling out. The chains have deserted many of our towns, some by going bust and some by moving to retail in other ways. Councils must do something, but they are desperately short of cash, and I agree with the hon. Member for Rochdale that metropolitan boroughs in particular are getting a poor deal at the moment with regard to the grant support settlement. Councils also complain about being short of certain necessary powers and levers—the Minister might have something to say about that—and they are also short of options.
Very early in any conversation with retailers we are asked, “What can you do about parking and the onerous charges? What can you do to level the playing field with out-of-town shopping?” Councils can tinker, but they cannot stop rationing parking because people will have just as many cars and there will be no more space in town centres than before. There will need to be some sort of system.
People say that the Government must do something, but the Government do not seem to have a clear or obvious solution. If they had one, I think they would employ it, because there is certainly the public demand, and also demand from other Members of Parliament. They do fund schemes, such as the Portas ones, and they employ advisers, such as Ms Portas. I think that they also employ Terry Leahy, which I am not so sure about. In my view, he is not necessarily the guy who has done the most for the high street over the past few years—certainly not in my town. We have a big out-of-town shopping centre, and Tesco made an unsuccessful bid to increase its area for non-food retail there, which would have hugely damaged the high street.
What I am trying to say is that the solution is elusive, which is probably because there is not just one solution but a range of individual ones. During the Portas phase, the Government did not approach a local authority and say, “You must do this,” or “You must do that,” but rather, “Bid for what you think you can do that will work”. The Government have a positive role. They can spread good practice. If they find that something works in Stockport or Rochdale, they should tell the world about it so that other local authorities and communities can follow suit. They can encourage the reinvention of the high street, through the promotion of business improvement district projects and the like. In my constituency, we hope soon to have a BID of some sort. A business improvement district gives local retailers more control over their immediate environment, and that can only be a good thing.
The Government need to do something, and sometimes it is easier to reduce the retail footprint, where that is sensible. If that means more domestic use in town centres, that is not necessarily a bad thing, as far as the vitality of towns is concerned. It might bring young people to a town who otherwise would not get housed at all.
The Government can do something about out-of-town development. I am told by the Federation of Small Businesses that Tesco often pays no rates on its car parks. It pays rates on its stores, but it has often negotiated an environment in which it pays no rates on its car parks. That is a clear anomaly that could be addressed to level the playing field.
I agree with the hon. Gentleman that, above all, the Government need to do something about the rates system, or about stimulating and producing some change in the commercial property market.
Mr Gregory Campbell (East Londonderry) (DUP)
The hon. Gentleman touches on an interesting topic when he says that Tesco and other large stores pay rates on their stores, but not their car parks. In examining the possibility of large out-of-town stores paying rates on their car parks, would it not make sense to redeploy and recycle that money into the regeneration of town centres to give them innovation, as well as colour, class and style, and so ensure that they are reinvigorated, even if that costs a bit more for out-of-town centres?
John Pugh
Totally. Out-of-town shopping centres have a duty to the town that they are outside, and with which they are often not engaged.
I understand that, during the pre-Budget negotiations, the Department for Business, Innovation and Skills thought it reasonable to investigate whether something might be done about retail business rates, but that the difficulty is how to advantage the people we want to be given an advantage—the small shopkeepers—not the big players, some of whom need no financial support whatever. I could refer again to Tesco.
Where we want to do something about business rates, that is currently more complex than it need be, which I want the Minister to investigate. I have heard reports from small business sources that when they want a downward valuation of their business rates and have a serious case—and when business rates are out of kilter with rents, as the hon. Member for Rochdale suggested—it takes far too long to get a result. By the time that it has all been sorted out, they will be out of business.
My fundamental point is that retailers must adjust to the shock of the new. They need to see their shops not as antagonistic to the internet, but must play along with it and be portals for it, because they have certain advantages. The current system, with white vans constantly going up and down the country and leaving brown parcels in the porches of people who are out, is not frightfully efficient. There is no capacity within internet marketing or sales for much to be done about repair or return, at least not without additional expense. Very little quality control can be exercised when people deal with an internet retailer, as opposed to one whose shop they can walk into to complain about the product. The interesting point—this is why I think that the hon. Gentleman is really on to something—is that some big stores, such as John Lewis, which have used the internet very well, have found that that has not corrupted or reduced their in-store sales, but has enhanced and developed them, so antagonism need not exist.
In conclusion, there is a need for the retail sector and the high streets of this country to pull themselves up by their own boot straps. There is significant help that the Government can get, and I am sure that there will be lots more sensible suggestions.