Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting)

Mark Sewards Excerpts

Committee stage
Wednesday 11th December 2024 Public Bill Committees

[Patrick Spencer (Central Suffolk and North Ipswich) (Con)]

Q Thank you, Mr Gerrard, for coming to give evidence. I want to put on the record my support for the premise of supporting community shops and stores and providing somewhere for people to go to do their shopping, but you mentioned that the provisions in the Bill will make distribution more expensive. Should we not be more concerned that home delivery, which we know is very important to vulnerable customers, will be more expensive as a result of the Bill?

Paul Gerrard: I think I am right in saying that the Co-op has the biggest quick-commerce business in the country. People order through aggregators and their orders are delivered from our stores; that is something that we have within our business model. Clearly, there will be costs going on to some of the depots and distribution centres and, to keep this revenue neutral, that will bring extra costs. I think that is the price of revenue neutrality. In the round, the impact on small stores and local shops will outweigh the potential risk around home delivery. As I said, we have a home delivery business; I think our quick-commerce business is the biggest in the country for small, quick deliveries. You are right to flag the risk, but in balance we would say that it is a positive thing that we are supporting brick and mortar shops as much as we can.

[Mr Mark Sewards (Leeds South West and Morley) (Lab)]

Q Thank you, Mr Gerrard, for your answers so far; they have been really insightful. We have Co-op shops in my constituency; the Co-op in New Farnley is virtually the only shop in that community. It was an absolute lifeline throughout the pandemic, and it is still a lifeline today, given that there are not other shops. We have had some questions about consistency. Obviously, the aim of the Bill is to provide consistency for businesses—especially those in retail, hospitality and leisure—by providing lower multipliers. You have said how beneficial it will be for about 92% of your properties. Can you talk more broadly about the potential benefits for other retailers?

Paul Gerrard: Certainly. I will make a couple of points. The last time I looked, about 95% of retail was microbusinesses with fewer than 10 employees. From the data I have seen, 98% of retail stores have a rateable value below £500,000. So this helps 92% of the Co-op but, from what I have seen, it helps 98% of the broader retail sector.

In my experience and the Co-op’s experience, high streets and precincts are not made by one business, but you often get one business beginning to drive vibrancy in that place. If one business can make it work, you attract custom and those customers might want to buy other things, so you will get a ripple effect from that. I think this will help communities, because it will make it much more viable for those small stores—either independent traders, or small stores of national businesses like the Co-op—to be in communities. I think the ripple effect will be significant. As I said before, there is a commercial thing there, but, as you alluded to, there is a hugely important social and community perspective as well.

[Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)]

Q Thank you, Mr Gerrard. I am the Member of Parliament for cities and towns such as Wolverhampton and Willenhall, and we have a number of Co-ops and similar stores. I hear today that the Bill brings a welcome certainty and that the majority of Co-op stores will benefit from it. Co-ops and similar stores are important local employers and have been for generations within the community. I wonder whether you could share your thoughts on the impact of that.

Paul Gerrard: As I said before, local stores, of which the Co-op is an example, play a hugely important social role. They are also economic and commercial entities. We employ 55,000 people. The vast majority of my colleagues are either in stores—as in your constituency—or in our funeral care homes or our legal services business, so they are customer facing. What the Bill does is make our business model of small shops more viable, which means that we can continue to employ people.

It also means that we can continue to behave in line with our co-operative values and principles. As I said before, we have always paid the real living wage, with rates set by the Living Wage Foundation, and we have always sought to have a different kind of product in store, in terms of its ethical roots. The Bill will help us to continue to do all those things. On 21 December we will have done it for 180 years. The Bill will play a role in helping us, as will other measures that the Government have taken.

--- Later in debate ---

[Lewis Cocking]

Q Have you asked your members that question?

Edward Woodall: We talk to them all the time about such questions. Perhaps it is something we can address in our written evidence to the Committee.

[Mr Sewards]

Q I will be brief. We have heard a lot about the cost of measures in the Budget, including in the Bill. Do you accept that there is some positive benefit in providing certainty to business—certainty that has been missing for a while? The measures in the Bill are designed to provide certainty over a longer period, but the measures in the Budget were designed for that as well.

Edward Woodall: On the Bill, I think I have said on a number of occasions that we welcome the fact that it brings more structure and that the overall principle is about long-term support for retail, hospitality and leisure businesses, and the areas in which they trade. In terms of that principle, we very much welcome the Bill; overall, businesses welcome greater certainty about how they invest into the future, so I welcome that in the context of the Bill.

[The Chair]

That brings us to the end of the time allotted for this witness. I thank Mr Woodall for his evidence.

Examination of Witnesses

Helen Dickinson OBE and Tom Ironside gave evidence.