Retail Sector

Debate between Wera Hobhouse and Lord Mackinlay of Richborough

Wednesday 6th June 2018 Commons Chamber

[Craig Mackinlay (South Thanet) (Con)]

The motion before us today is somewhat rambling, dare I say. It has three parts. It is about squeezing wage growth, the condition of the retail sector, and there is a bit of Brexit put in as well—but we will have 12 hours next week to discuss that. Generally, however, what the Opposition are putting forward is that the Government should do more. They should spend more, subvert reality and revert this country to a command and control economy.

Let us look at wage growth, because we have had so much misdirection and ignorance of the truth regarding that. I think that the Opposition hope that if they say it often enough, people might believe it, but I recommend that they look at the facts. Let us look at a hypothetical, lower-paid employee. In 2010, the national minimum wage for those over 21 was just £5.80. Today, in 2018, it is £7.83; that is a 35% rise. Let us look at the income tax personal allowance. When we came into Government in 2010—we were left to pick up a lot of mess by Labour—the tax-free allowance was just £6,475. Today, in 2018-19, it is £11,850; that is an 83% rise in the tax-free band. Let us put those together. A 35-hour-a-week lower-paid employee at minimum wage in 2010 would have had take-home pay, after tax, of just £9,740, but today, the minimum wage and that huge increase in the tax-free allowance means that their take-home pay is £13,768. That is over £4,000 in real cash in the pockets of the lower paid under this Government. That represents a 41.4% increase in take-home pay.

[Wera Hobhouse]

It is, however, about the balance between the two. In relatively successful towns or very successful cities such as Bath, which I represent, shops are still doing fine but life is more expensive, so the balance of what people take home as pay and what they have to spend to live in an expensive city is much higher, too. The balance of the two, even in good, successful town centres such as Bath—and it is not that successful—is not right.

[Craig Mackinlay]

I thank the hon. Lady. Today’s debate is about the retail sector and wages. I was going to say that 41.4% over eight years is 5% a year, which is greater than any measure of inflation, no matter which one people care to mention, so there has been a real cash increase to all those working. We have the lowest unemployment since the 1970s and more people in work today than we have ever had in the history of this nation. I am afraid that we must stop listening to the misinformation from the Opposition. Their statements are simply not true. Real wages are rising.

In the retail sector, as we have heard, we have had business rates relief and changes from RPI to CPI, which will mean a reduction of over £2 billion to those who have retail stores. During this Parliament over 600,000 businesses will pay no business rates whatsoever, and in the first half of 2017, more retail units were opened than closed. There are 300,000 more in employment in the retail sector than in 2016.

That does not mean that everything is rosy on the high street, but when we consider what the Government did in 2008, when they took this country into probably the worst recession that it has ever known, in the third quarter of 2008 alone, there was a 4.2% decrease compared with the year before. That happened in just one quarter under Labour; that is what they condemned this country to.

The real debate here is the changing face of retail, and the internet is the reason for that. With spending now at £1.2 billion per week, 17% of all spending is now on internet purchases, and that is a 12% year-on-year increase. That is not unique to Britain, but is happening across the entire world.

That is the reality of life, and we are all guilty of fuelling it. If I want a shirt like the one I am wearing but in blue with a 34 inch arm and a 15½ inch collar and I want it delivered tomorrow, ordering that will take me three minutes, and it will be delivered. We are all purchasing in that way now; unfortunately, we are all fuelling the changes to the high street.

We have had debates about banking in the House, and I have taken part. Our banking landscape is changing, sadly, because we are all being encouraged on to mobile apps and mobile banking. Also, when did anyone in this House last book their flights in a high street travel agent?

--- Later in debate ---

[Wera Hobhouse]

Will the hon. Gentleman give way?

[Craig Mackinlay]

No, as we are nearly at the end of the debate.

The high street simply needs to redefine itself. High streets need to create themselves as places to go for a pleasurable afternoon—to do some browsing and shopping, but to enjoy the experience as well. That means there is a duty on councils and the retailers themselves to make the high streets clean, attractive and somewhere good to go.

My answers to this conundrum are that we should revise taxation of retail more towards the internet and warehousing-style operations, focus on making high streets places to go for an experience, and in many cases, such as in Ramsgate, high streets are too spread out and too big, and they need to be smaller to become the vibrant heart of the town. We all need to shop locally, too; that will help.

Proportional Representation

Debate between Wera Hobhouse and Lord Mackinlay of Richborough

Monday 30th October 2017 Westminster Hall

[Wera Hobhouse]

Will the hon. Gentleman give way?

[Craig Mackinlay]

I am making a powerful point, and then I will give way. Angela Merkel received 33% of the vote and is unable to form a Government. How will that Government be formed? It will be formed in back rooms, not anywhere near the ballot box or the people who elected on that day. That has to be one of the most unfair systems for creating a Government.

[Wera Hobhouse]

I am very grateful that the hon. Gentleman has given way. I always love it when people talk with such conviction about areas that they do not necessarily know so much about. I challenge him that I know more about Germany than he does. A coalition Government is not an unfair Government—it is a coalition, in which two or several parties come together to form a Government, bringing several views together, rather than just the view of one party. That does not mean it is an unfair Government, or that people do not know what the result of that Government will be. It is a coming together of views that creates a better democracy and better governance.

[Craig Mackinlay]

I thank the hon. Lady for that view and perception, but she must realise that, in these back-room coalition deals, it can be the most small party, which has been rejected virtually nationally, that holds the balance of power. [Hon. Members: “Like the DUP?”] We do not need DUP Members to that extent, although we are grateful to have them. [Interruption.] May I just finish this point? In Germany, it is often the Greens that hold the balance. In this country, deals are generally done with parties of a similar persuasion, exactly as in our maintenance agreement with the DUP.

[Wera Hobhouse]

What is wrong with smaller parties having a say in government? It is sometimes very healthy and is a great sign of democracy.

[Craig Mackinlay]

I do not disagree with the hon. Lady’s point, but when parties completely different from the main parties hold the balance of power, that is a danger.

I will close my remarks; I am glad they have caused some excitement. If we had a 33% result in this country, we would have another general election. That does not happen in Germany and other places that have PR in prevalence. I want strong Government, and first past the post, despite its flaws, tends to give that result most of the time. Frankly, I think we should reject any other system.

Several hon. Members rose—