High Streets

Simon Danczuk Excerpts

Wednesday 16th October 2013 Commons Chamber

[Brandon Lewis]

My right hon. Friend makes a good point. I agree and will come to that in a few moments.

Labour made it more difficult to park in town centres—my hon. Friend the Member for Colne Valley (Jason McCartney) has mentioned that point—with Whitehall guidance issued by John Prescott telling councils to cut the number of parking spaces, increase parking charges and hit drivers with fines. In 2008, the local government Minister, the right hon. Member for Wentworth and Dearne (John Healey), complained that councils were not using parking charges to their “full potential”. By the end of Labour’s time in office, 9 million parking fines a year were issued in England. What was the public’s response? Quite sensibly, they are taking their time to shop online or drive to out-of-town stores where they are not penalised for using their cars. That was Labour’s response to changing lifestyles and the internet—to make it as difficult as possible for people to shop in and visit our town centres.

[Simon Danczuk (Rochdale) (Lab)]

Does the Minister not accept that the elephant in the room is not the Secretary of State and his views on car parking, but business rates rapidly increasing and damaging small businesses?

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Can we try to be a little more courteous to Members in all parts of the House?

--- Later in debate ---

[Simon Danczuk (Rochdale) (Lab)]

I congratulate the Minister on gaining responsibility for the Government’s high street policy. I take the opportunity to declare an interest. Later this year, before Christmas, I am opening a high street shop. My wife and I are establishing Danczuk’s Delicatessen on Rochdale’s high street. You are invited to come and try our wares, Mr Speaker, as are other Members.

Let me start by talking about Rochdale’s high street. It is suffering just as much as many others across the United Kingdom. It has an average number of empty shops, but it lacks diversity. We have too many charity shops, too many “cash a cheque” shops and far too many payday loan companies. Our problems are similar to those in other towns, of course, because the overall problem is the economy. The Government have presided over a faltering and, at best, flatlining economy. That is what is causing the failure on our high streets.

I want to make an important point: the growth in underemployment and the increase in temporary, part-time jobs, zero-hours contracts and low-paid work all feed through to the high street. The nature of that work is the cause of the growth in the number of pawnbrokers and payday loan companies on the high street, and not just in Rochdale, but in towns and cities across the United Kingdom.

My hon. Friend the Member for City of Durham (Roberta Blackman-Woods) referred to the Local Data Company’s research, rightly published today, which shows that although chain stores and multiples are in decline, the number of independent retailers is increasing. That shows—again, this is a reflection of the economy—that the people who have been made redundant over the past couple of years have used their redundancy money to be entrepreneurial and to set up shops. I do not decry that point, because it is an effect of what has been going on in the economy, but it has caused churn and flux on our high streets.

Another important point about the economy is the living standards crisis that the Government have caused. They cannot take £1,500 a year off the average working family and expect that not to have an impact on the high street. The consequence is a major drop in consumer confidence, and it has certainly changed shopping habits. That, too, is having a direct impact.

I admit that it is not all the Government’s fault—internet shopping has had an impact, of course—but I believe that they have a laissez-faire attitude towards our high streets and that is causing many of the problems. We have seen their Portas review. The problem is that it has not had much of an impact. They ignored Mary Portas’s comments on business rates, which I think was a mistake. The Portas pilots and the review have now become mired in problems and scandals about how much she was paid by Channel 4 and whether Channel 4 and the programme producers had any involvement in liaising with the Department about where the pilots should be. What I think the Government have learned from that episode is that reality TV is no way to develop Government policy.

The Government would do better by listening to Bill Grimsey’s alternative high street review. He talks about the need for stronger local leadership, better local analysis of what is going on in local areas and better use of technology on the high street. Most importantly, he calls for a radical overhaul of business rates. To illustrate that point, we learned yesterday that inflation now means that business rates will increase in April by 3.2%. According to my analysis, that will add an extra £200 million to the bills of hard-pressed retailers—not all business; just retailers. The truth is that we pay the highest property taxes in the European Union. By 2015 the Treasury will have received more receipts from business rates than from council tax.

[Yasmin Qureshi (Bolton South East) (Lab)]

In the light of what my hon. Friend is saying, does he agree that Labour’s pledge to cut and then freeze business rates would help 1.5 million small businesses and give local shops and retailers a real boost?

[Simon Danczuk]

My hon. Friend is correct. That is an extremely important point. That cut will help significantly. I have seen the damage this is doing in my constituency. For examples, my local fish and chip shop recently closed and the premises are being advertised with a rent of £6,000 per annum, but the business rates are £18,722 per annum.

[Mark Pawsey]

Given what the hon. Gentleman says, is he disappointed that the motion makes no mention of reforming the business rates system?

[Simon Danczuk]

Business rates are clearly mentioned in the motion, and Labour Front Benchers have made it clear that there will be a review of business rates under a Labour Government.

Postponing the revaluation of business rates does nothing to help small businesses. Because of this postponement, retailers in Rochdale are subsidising retailers on Regent street in London. That is unacceptable. The Government often say that rate relief can be a subsidy, but it does not even apply to the vast majority of retailers right across this country. According to the Office for National Statistics, in the period between this Government coming to power and 2015, businesses will pay an extra £6.5 billion in business rates on top of what they were already paying.

The Government and the Minister need to listen to what is being said. Let me give some examples. The hon. Member for Witham (Priti Patel) has spoken about this and, I understand, has written to the Chancellor asking him to speed up the revaluation of business rates. This week the hon. Member for South Suffolk (Mr Yeo) has written in his local newspaper that he is going to speak to the Communities and Local Government Secretary about the problem with business rates. The hon. Member for Altrincham and Sale West (Mr Brady) has said that business rates are causing real problems and need urgent reform. The hon. Member for Watford (Richard Harrington) has said that business rates should be linked to the consumer prices index rather than the retail prices index. The hon. Member for Nuneaton (Mr Jones) has said:

“Friends in the Treasury should consider freezing business rates…and give a fighting chance to small businesses.”

The fact will not be missed that all those hon. Members are Conservatives. It is not only Opposition Members who think that business rates should be radically reformed, revised and changed to help small businesses; Government Members think so too.

Let me conclude by echoing the good point made by my hon. Friend the Member for Bolton South East (Yasmin Qureshi). When the Labour leader recently announced that a future Labour Government would first reduce business rates and then freeze them, Bill Grimsey, a well-known local retailer, said that Labour was the first party to demonstrate that it gets it. When will the Government get it and cut business rates?