Employment and the High Street

Seema Malhotra Excerpts

Wednesday 7th December 2022 Westminster Hall

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

It is a pleasure to serve under your chairship, Mrs Cummins. I congratulate my hon. Friend the Member for Hornsey and Wood Green (Catherine West) on securing this popular debate, which comes soon after the 10th anniversary of Small Business Saturday. As someone who grew up above my parents’ small business, I was delighted to celebrate with my hon. Friend and so many colleagues from across the House.

Everyone has spoken powerfully. My hon. Friend the Member for Hornsey and Wood Green, the hon. Member for Keighley, my hon. Friends the Members for Stockport (Navendu Mishra), for Bolton South East (Yasmin Qureshi) and for York Central (Rachael Maskell), and the hon. Member for Strangford (Jim Shannon), have spoken on common themes: the need for regeneration; the need to tackle the high costs affecting local high street businesses; fluctuating prices hitting profitability and services; the urgently needed business rates review; the closure of bank branches; the loss of ATMs; the impact on families and local consumers; and the need for civic pride.

We are also here to celebrate our small businesses and high streets. Good high streets are anchors of community life, where neighbours come together. They employ so many in the local community: an estimated 14% of the UK workforce works on the high street, in civic centres, leisure centres, cafés, offices, banks, post offices and so on. Our high streets reflect and shape the character of the places they are in. They are the backbone of what Labour calls the everyday economy, they are central to our growth agenda for the local and national economy, and they are a space for local entrepreneurship and community businesses. Those arguments are made so powerfully by UKHospitality, the British Retail Consortium, the National Hair & Beauty Federation and others. We need to see our high streets thrive.

We all know that, as has been illustrated in the debate, times have been tough. But they have been made tougher because of the lack of action—speedy action—from the Conservative Government. They also do not do enough to pre-empt the impact on local communities of the decisions they make in respect of local authority spending cuts and so on.

We have also seen the issues relating to shifting spending patterns and the severe inflationary headwinds leaving consumers with less money to spend and retailers with slimmer profit margins. PwC expects Christmas spending to decline by £1.8 billion—and that is in the golden quarter, when retail traditionally recoups any losses. This matters because, as emphasised by Gordon Brown’s commission on the future of the UK, launched this week, the high street prospers only when the local community and local economy are strong, because people need money in their pockets in order to spend it.

The stress caused by the cost of living is now a major cause of abuse against shop workers. Retailers such as Tesco, representatives of which I met last week as part of its winter food-collection scheme, told me about the increase in the shoplifting of everyday items. People are struggling just to get by. The trade union USDAW, which has made powerful contributions to the wider debate, says that verbal and physical abuse is worsening. On a recent visit to Sainsbury’s I saw for myself the fortitude of staff in dealing with abuse that should not be coming their way.

The decline of the high street is a problem we have been aware of throughout the Government’s time in power. They even commissioned the Portas review, but in August Mary Portas hit out at the Government for their dither and delay while high streets faced what she called the “biggest proper crisis” she has seen. Last year, the Levelling Up, Housing and Communities Committee criticised the Tories’ current solutions, such as town deals, the towns fund and the high street taskforce, as

“too complex, short-term, and fragmented”.

They do not come anywhere near to making up for 12 years of local authority underfunding, let alone a strategy for regenerating our high streets and supporting businesses to achieve net zero.

Unlike the Conservatives, we want to see high streets that are thriving—and we have a plan for that. We will implement a robust industrial strategy, so that business owners can plan and invest with confidence in our communities. We will implement a plan for clean energy, so that by the end of the decade we are saving almost £100 billion for businesses and consumers. We are committed to the reform of business rates. The current unfair system sees high street businesses forking out a third of business rates even though they make up just 15% of the overall economy. We would level the playing field between online retailers and bricks-and-mortar shops by increasing the digital services tax. The retail sector is absolutely crying out for that—indeed, the Retail Jobs Alliance, a coalition of major retailers, is calling for that very policy.

Communities must be put in the driving seat. To put them there, we should support the growth of co-operatives and ensure that communities are given a real stake and say in the development of their town centres. That is why the Labour party is committed to doubling the size of the co-operative sector. Labour city Mayors are also making a difference. For example, the Mayor of London is funding night time enterprise zones, because opening up at night can increase footfall during the day as well. The pilots have been successful.

Labour’s plan would strengthen the high street, because we listen to those who use and make the high street on the need for an industrial strategy, the dignity of retail work and the reform of business rates. We want to see this sustained through co-operatives, assets of community value and the biggest transfer of power the UK has ever seen. I look forward to the Minister’s response to the important issues raised in the debate.