MP raises importance of local independent retailers in Commons

Geoffrey Cox secured a Parliamentary debate on the future of independent retailers this week, in which he urged Ministers to do more to help high street businesses in rural market towns. In the course of the debate, the MP expressed his dismay at Devon County Council's proposals to introduce parking meters on streets currently available for free parking.

In his speech with which he introduced the debate, Geoffrey Cox congratulated the initiative and determination of local business people who were working hard to help themselves, citing examples such as Tavistock's proposed Business Improvement District and Holsworthy's "Holscard" loyalty scheme.

The MP who has conducted a series of meetings with local businesses in recent months, listed ways in which Local Councils and Whitehall could support small shops and protect them from needless bureaucracy, large chain stores undercutting their prices, and bad planning decisions driving away their customers.

These included proposals for independent retailers to receive extra consideration in the planning process, new requirements for consultation with local traders on giving planning permission to charity shops including the forfeit some of the generous concessionary business rates if they sell brand new rather than donated goods, small business rate relief to be made automatic, small businesses willing to take on an empty shop in high streets receiving a rate holiday, and local councils stopping treating parking charges as a source of revenue and doing more to assess the damage high fees can do to local businesses. He criticised Devon County Council's plan for parking meters, which were not appropriate for some market towns.

Mr Cox said: “We need local leadership supported by local authorities and underpinned by encouragement and leadership from the Government. This should be a crusade.”

But he added that he did not want the debate to become “a depressing, gloomy litany of problems for the high street.” Instead, he pointed out, local businesses were resourceful and imaginative in finding ways to promote themselves and the communities in which they were based.

Speaking after the debate, Geoffrey Cox said: “Times have been tough for independent retailers in recent years, and we need to do all we can to give local firms the support they need. We have already seen some encouraging signs. The reversal of the planned increases in small company corporation tax and in employer's national insurance is welcome, and the Government’s decision, confirmed by the minister in the debate to double the level of small business rate relief in England and to make it automatic will be music to the ears of retailers across the country.

One local businessman I saw a few months ago joked that the best way to start a small business under the previous Government was to buy a big one and wait. Ministers need to make sure that this joke is not still told in the years to come. I remain confident that they will not be found wanting in that regard.”


Mr Geoffrey Cox (Torridge and West Devon) (Con): It is a pleasure to serve under your chairmanship, Mr Weir, and to have secured this debate on so important a subject. I welcome my hon. Friend the Minister to his position-this is my first opportunity to do so on the Floor of the House-and I know he will fill it with considerable distinction. When occasionally I give the odd, not criticism but constructive prod, I hope he will forgive me and take it in the spirit in which it is intended.

This afternoon is an opportunity for friends of the Government-those who support them-who represent market towns and town centres all around the country to draw to their attention the important predicaments, problems and issues that business people, particularly small business people and independent retailers in high streets and town centres, have confided in us. A great deal of hope is reposed in this Government.

On Monday, I attended a business breakfast with the Tavistock chamber of commerce. Broadly speaking, my experience is that local business people in my constituency-I would expect this to be replicated throughout constituencies in the south-west and beyond-are understanding of the Government's economic policy. They perceive that dealing with the financial crisis that we inherited was the overwhelming priority for this Government. They understand that the necessity of controlling the deficit and getting on top of it was all-consuming, and that for the past six months Ministers in the Department for Business, Innovation and Skills, the Treasury and throughout the Government have been concentrating on that essential task.

Business people in my constituency are now looking for what the Government will do to stimulate growth. What will they do in terms of the range of measures available to them, given that they are hedged in by economic circumstances? What can they do to foster prosperity and to enable businesses to get going, which they will if they are given the means?

In respect of the high street-which I intend to concentrate on this afternoon, specifically high streets in market towns, four of which I represent-I want to have a word or two with the Minister and recommend several things. In doing so, I shall crib shamelessly from the Conservatives' commission into small shops in the high street, on which I had the privilege of sitting, and which reported in July 2008. I am delighted to see its distinguished chairman, my hon. Friend the Member for Northampton South (Mr Binley), who presided so expertly over that meticulous examination of all the issues that affect independent retailers. The commission included many people of great expertise, and I commend it to the Minister as a template for Government policy on this important subject, at least at the beginning.

The distinctive character of a town-its sense of place and individuality-is substantially created by the diversity and quality of the retailers on the high street who provide personal service and much of the town's variety and interest to visitors. Empty shops, an increasing number of charity shops and dilapidated town centres affect the morale of a community. They deter visitors and lead to further decline. Last year, 12,000 independent shops closed.

I unashamedly declare that my focus today is on the market town. I have four of them in my constituency: Tavistock, Holsworthy, Great Torrington and Bideford, each with their own unique identity and traditions, and strong communities. Their business people are resourceful. In Holsworthy, they have joined together under the banner of the chamber of trade to create the Holscard, a loyalty scheme that entitles members who sign up and obtain the card free of charge to discounts and special offers.

Each year, the Tavistock food festival attracts a large number of local food producers who show off the extraordinary variety, sophistication and quality of food that our area has to offer. The chamber of commerce and other business organisations are active in supporting events that enhance the vitality of the town's appeal to visitors. This Friday, Tavistock will have its Dickensian evening, which I strongly recommend to the Minister. It is great fun, and it heralds the real start of Christmas festivities in the town. The main streets are closed to traffic, all the shops are open until 9 pm, and the chamber of commerce organises a vast range of different activities: choirs, brass bands, a woodwind band, a fire eater, jugglers and morris dancers, to name but a few. Many of the shopkeepers dress up in Victorian costumes and hand out mulled wine to their regular customers as a way of thanking them for their custom throughout the year. There is a serious purpose to the evening. It attracts 12,000 visitors to the town who spend money in the local shops, and many return throughout the year. The town is also in the process of setting up a business improvement district.

Great Torrington's rich civil war history provided the backdrop for its community development trust to set up Torrington 1646, a fascinating historical "time machine" which takes visitors, including schoolchildren, back to the days of the civil war and allows them to experience life in the town during that era. The trust has refurbished the Victorian pannier market to create a modern retail space and has enhanced the appearance of the town centre.

The Bideford 500 project to rediscover and promote the proud history of the town is well under way. It was in and from the port of Bideford that Grenville built his ships and set sail on his Elizabethan adventures, and some of the first settlers in America also started from there. The project complements the Bideford regeneration initiative that will redevelop important sites around the town.

I mention those few examples of the initiative, ingenuity and activity of local business people to demonstrate to the Minister that those communities have not sat back and declined to take responsibility for their own future. They are not without the will to seize control and to take into their own hands the initiative and responsibility for improving their lot, but they have not always felt that the Government, both local and national, have been on their side. It is to that end that I urge the Minister, after just six months in government, to bend his intellect and the resources of Government.

Times are tough. Small independent retailers and many other small businesses face increasing competition from the internet. They face often unfair competition from supermarket giants with their free out-of-town parking, and their ability to sell below cost to persuade customers through the door while they recoup the cost on other products. The Office of Fair Trading reported in 2006 that 1.8% of grocery lines were sold below cost. That sounds a small amount, but shrewdly shifting discount offers from product to product is a powerful commercial tool that represents a major disadvantage to independent retailers in the high street, as my hon. Friend the Member for Northampton South noted in the small shops commission report. In addition, of course, businesses cannot escape the inevitable difficulties of the prevailing national economic situation. Next year, VAT will rise to 20%, fuel prices are high, and shoppers are drawing in their horns and spending less.

As I said, I attended a business breakfast with members of the Tavistock chamber of commerce on Monday. I found a ready recognition of and support for the Government's compelling priority of mastering the unprecedented peacetime deficit left by Labour. Not a single voice was raised against that Government policy in this crucial regard. The overall direction of our national economic policy is fully understood and supported by small business people.

I know that the Minister, together with my right hon. Friend the Chancellor of the Exchequer, is now concentrating on the measures necessary to stimulate and facilitate the private sector growth that will be essential to our economic recovery. The Minister's Department will be central to that mission, as will others, and I venture to suggest to him that there needs to be concerted and co-ordinated action, in which all Departments, as well as local government, play a part.

In respect, however, of the vital need for leadership and the critical importance of local and national Government co-operating to support small businesses in town centres and on high streets, I have found apprehension, based not on the abilities of our Minister or on the willingness of our Government, but on experience of the previous Government. Small businesses are apprehensive about the necessary leadership being there to support the work they are doing to improve the situation. One local business man joked that the best way to start a small business under Labour was to buy a big one and wait. I am confident that the Minister and this Government will not be found wanting in that regard.

Mr Brian Binley (Northampton South) (Con): It is a great pleasure to serve under your chairmanship, Mr Weir.

Does my hon. and learned Friend agree that local government has, in fact, a major part to play in aiding small businesses? We have seen parking charges increase to the point at which they are stopping people coming into town centres, and there is no ability to stop and shop for a short period. There is piecemeal planning, which cuts out small units for people to start up, and there is an unrealistic attitude to rateable values, which is not directly related to local government but related to government more generally. Out-of-town development has become a much more valuable area in which to do business than many of our town centres, and yet town centres are still rated very highly. I could go on, but do we not need to draw to the Minister's attention the import of local government, and the fact that it has hampered small and medium-sized businesses in our town centres for a considerable time?

Mr Cox: I, as ever, regard my hon. Friend's points in this, an area of expertise for him, as compelling and significant. There is no doubt that local government has a very important role to play, but national Government must give the lead, and I urge the Minister to act on that. We do not often talk about big measures but we often talk about small ones, which cumulatively can become a powerful support to high street shops and businesses. Planning is one example. Less than 40% of new retail space planned for the next 10 years is for town centres. The abolition of the need test for out-of-town supermarket developments in planning policy statement 6 was a retrograde step. I fully support that test and I urge the Government to consider restoring it, and I urge the Minister to discuss the matter with the Secretary of State for Communities and Local Government.

We should go further and consider inserting a diversity test into retail planning guidance. Small shops might have their own use class, so that they could receive the special consideration that their function on the high street deserves. Changes to the planning system regarding the need test, sympathy shown to small shops via the creation of their own use class, and a diversity test that would impose on planners the need to consider the balance between local independent retailers and vast out-of-town supermarket businesses and to give weight to the need for diversity on the high street, would be a positive step forward.

Jo Swinson (East Dunbartonshire) (LD): I am listening to the hon. and learned Gentleman with great interest, and I congratulate him on securing the debate. What he says about planning is absolutely right, and it is not just about large out-of-town supermarkets. In Milngavie in my area, we face a potential Tesco Extra right in the middle of the town, with another massive supermarket possibly in Bishopbriggs, and the small traders in those areas are very concerned about the potential impact on the viability of their businesses. The hon. and learned Gentleman might find that that is also the case in other parts of the country.

Mr Cox: My hon. Friend's experience is, I think, replicated in dozens of constituencies around the country, and I fully understand her concern. What I am asking for is a co-ordinated approach. The Departments for Communities and Local Government and for Business, Innovation and Skills, and the Treasury, need to get together and think about the high street as a separate issue. That would include looking at planning decisions and guidance, and considering what we could do about charity shops, for example.

Simon Danczuk (Rochdale) (Lab): I, too, congratulate the hon. and learned Gentleman on securing this very important debate. I also congratulate the Government on producing their document about a health check in town centres and on the high street. It is a valuable document, and of some good use.

On charity shops, I had a look at the hon. and learned Gentleman's website before I came here today. It rightly says that charity shops are better than empty shops, and I agree, but the proliferation of charity shops in my constituency of Rochdale has reached the point at which they become a problem. So in respect of planning regulations, I urge the Minister and the Government to consider giving local authorities the power to determine the number and location of charity shops in their areas.

Mr Cox: I agree with the hon. Gentleman, to a large extent. The main issue that I have heard is that charity shops are selling new goods. More and more charity shops are setting up on the high street, and instead of selling the donated goods of many hundreds and thousands of well-wishers, they are selling a whole range of brand-new goods-often sports goods and clothing.

It is not hard to understand the chagrin, confusion, dismay and disappointment of a shopkeeper, selling the same product lines, on hearing that the charity shop next door has been given not only the mandatory 80% relief, but the other 20% that the local authority can give. The charity shop might, therefore, be paying no rates at all. Its waste is treated as commercial, but the private shopkeeper is unable to have their waste treated thus, and it would seem to the struggling shopkeeper-who, after all, will be here in many years and is supplying a vital service for the community, bringing about a sense of well-being and contributing to the local economy-that the playing field is not even.

I do not suggest, as the hon. Member for Rochdale (Simon Danczuk) noted, that we should be anti-charity-shop, but I do propose to the Minister that we need to look at a protocol for local authorities, which would allow them to consult with local shopkeepers about the product lines that might be sold in a charity shop. Such consultation would help, but equally we need to look at whether charity shops that are selling brand-new goods should receive the rate relief that they currently do.

Andrew George (St Ives) (LD): Does my hon. and learned Friend not also agree that on the non-regulatory side there are things that the Government could do, simply by using their influence? For example, there is the established practice of upward-only rent reviews, which informs the rates charged in town centres. I urge him to highlight that issue and, on the regulatory side, to ensure that the free parking from which out-of-town retailers benefit is properly valued, because of the consequences that it clearly has for their competitors in town. Free parking gives out-of-town retailers an enormous advantage, and that is not properly reflected in their rating levels.

Mr Cox: My hon. Friend has, with uncanny empathy, predicted my next set of points, although he did not express them with the same eloquence as I would have, and probably not the same passion. I shall, therefore, go on to make the points, and a few others besides.

Rents and rates are a vital issue for high street shops and independent retailers, and my hon. Friend makes a very powerful point about upward-only review clauses. I would welcome the Government's investigation of that issue, because the Conservatives' commission into small shops in the high street recommended that we examine it to see whether we could make inroads into the unfairness. I want, however, to come on to rates.

One hears about planning, rates and charity shops, and rates come up time and again when I talk to small businesses in my constituency. The system is byzantine; it is incomprehensible. Walking into a local business, I sometimes find that the pub or petrol forecourt, for example, has had its rates lifted by thousands of pounds in the past year or two. In 2009, there was a 5% rise for inflation. A transitional relief scheme came to an end, so shopkeepers and business people were hammered by large rate rises.

However, the small business rate relief has not kept pace. Many businesses that are regarded as small-we would all regard them as such-are no longer covered by the relief. I urge the Government to consider raising the threshold for that relief. The Government could, importantly, immediately and urgently, translate the Conservative manifesto commitment, with which I have no doubt my Liberal Democrat friends will agree, to make small business rate relief automatic. It should not depend on an application. The rate authorities are able to see whether a business complies with the conditions necessary for small business rate relief, so why do they not simply apply it?

I implore the Minister to lend impetus to our examination of this issue. If we can raise small business rate relief, increase its threshold and make it automatic, we will do a lot to cause a sigh of relief up and down high streets.

Chris Ruane (Vale of Clwyd) (Lab): I congratulate the hon. and learned Gentleman on securing this debate. I share many of his concerns. Does he believe, as I do, that many small businesses in our town centres face a double whammy when a national chain locates in the town centre, often selling the same products as smaller companies, but at a lower price? The rates for those smaller companies increase because the big national has come into town and allegedly increased the footfall. So those smaller companies lose both ways: their rates go up and their ability to sell cheaper goods goes down.

Mr Cox: I do not want this debate to appear a depressing, gloomy litany of problems for the high street. I prefaced my remarks with the kinds of initiatives that communities throughout the country are showing-business improvement districts, taking on regeneration and community trusts-as they fight to sustain their towns and town centres. All communities will have a similar interest.

I agree with the hon. Member for Vale of Clwyd (Chris Ruane). The small business in the high street needs special consideration from the Government. That is why I make my proposal to the Minister today and ask him to reflect on it.

On Monday, I met representatives at the Tavistock chamber of commerce and one trader said to me, "Mr Cox, 25 shops in Tavistock are currently unoccupied. Why should we not grant a rate-free period for a small business that is willing to take on one of those shops, with phased gradations up to the full sum, say, over three or four years?"

The Minister could adopt that measure, which would greatly benefit businesses setting up in our market towns throughout the country. Nowadays, they could probably get a rent-free period, but why not enable the local authority to grant a rate-free period? If we did that, it would be a small measure, but its overall effect would be disproportionate and would impact on the confidence of businesses to enter the high street, off-setting some of the difficulties that the hon. Member for Vale of Clwyd mentioned a moment ago.

Paul Uppal (Wolverhampton South West) (Con): May I thank my hon. and learned Friend for securing this debate? The gist of his speech is specifically about market towns, but my constituency is particularly marked by the number of empty shops. The point that my hon. and learned Friend mentioned has been raised by shopkeepers, entrepreneurs and landlords in the centre of Wolverhampton. Giving relief on empty shops when new tenants are coming in would be a constructive way to take the issue forward.

Mr Cox: I agree with my hon. Friend. In fact, I would go further and place in the hands of local councils the ability to grant a temporary rate relief for new businesses.

My right hon. Friend the Chancellor of the Exchequer has already introduced in the Budget a number of measures for new business and start-ups. It is a critical priority for this Government. But we could help shops setting up specifically in the high street. They are so valuable and important to the overall welfare and well-being of the towns that we represent. It would be a simple measure that would, cumulatively with others, have a powerful impact. I want to mention other measures, but I want to sit down soon because I am interested in hearing the experiences of other hon. Members.

The measure that I have proposed is consistent with the overall philosophy of this Government, which is to place into the hands of local communities' councils the power to do something about the fabric and infrastructure of their communities. I urge the Minister to consider that measure.

Whenever one mentions high street shops, issues arising always include parking. I am dismayed and disappointed at how often local authorities, particularly county councils, seem to use parking as a generator of revenue. Time and again the national Government have urged local government-often with a measure of disingenuousness, given the fact that they have starved local government of the means with which to do its work, while piling extra responsibilities on it-

Chris Ruane: Will the hon. and learned Gentleman give way?

Mr Cox: Not now. I will come back to that.

Chris Ruane: It was going to be about starvation.

Mr Mike Weir (in the Chair): Order.

Mr Cox: This is not meant to be a partisan point. I am not, on this occasion, having a jab at the previous Labour Government. I apply this point to all Governments.

So often, Governments say to local government, "You should be doing this and that", but do not provide the wherewithal for local government to do it. Local government has to understand that it is no use proposing new and ever-increasing parking charges and not expecting to deal a blow not only to the morale and confidence of traders, but to their economic interests.

Good parking, easy access and quick-stop parking, as the commission headed by my hon. Friend the Member for Northampton South (Mr Binley) called it, are vital to the health of the high street. It is essential that, in our constituencies, local government consults traders, stands by their side and designs parking and transport systems in a way that helps traders and does not simply generate cash from the consumers and customers on whom they depend. That is an easy statement to make.

I am dismayed that Devon county council, a Conservative council, proposes parking meters throughout the county towns, although that is inappropriate in some towns. Towns are struggling on the edge-the precipice-of economic viability, and to add extra charges for parking when people could go down the road to out-of-town free parking, as the hon. Member for St Ives (Andrew George) mentioned, is an extraordinarily crass, clumsy action. I urge Devon county council to think again or at least ensure that its consultation is real and that it tailors any parking schemes to the economic interests of the high streets in the towns on which it intends to impose those charges.

It is vital that we get parking right. Not only must we have a sensible parking regime, with different structures for times of day and the ability to park free for up to an hour, which are vital, but it must be enforced sensitively. How many times, when one goes to the local town council-hon. Members may have heard this-does one hear them say, "If only we could just enforce these things relatively flexibly and intelligently"?

The memory of getting a £40 or £60 parking ticket in a town stays with the visitor. They are not likely to look favourably on the town if, after a few minutes, they get a parking ticket for overstaying. It is crucial that local governments understand such things, and I believe that the national Government can set a lead with advice and guidance.

To that end, I agree with the hon. Member for Rochdale, who mentioned the high street health check issued by the Department for Business, Innovation and Skills. That is an interesting innovation; I do not believe that it is anything more than a start, but it is certainly worth doing and I urge the Minister to follow it up. I have read the document with interest and it touches on some important issues. We need that kind of leadership. We need local leadership supported by local authorities and underpinned by encouragement and leadership from the Government.

This should be a crusade. I want to paint for the House a picture of the Minister on his white horse, dressed in shining armour and shouldering his lance.

Chris Ruane: Lady Godiva.

Mr Cox: He does not have the hair to be Lady Godiva, although he has a fine head of hair none the less. Picture him riding out on his white charger, shouldering his lance and flying the flag for the high street. I know that the Minister is a Cornishman, and speaking as a Devonian, we look across the Tamar river with admiration, regard and not a little envy. The sum of £132 million is being spent on the good people of Cornwall-and by Jove they deserve it-joining up every village, town and community to super-fast broadband. The people of my constituency are like small children pressed up against the window of the pie shop, envying the sight of the riches within.

Broadband is important, and in Cornwall people are getting access to that wonderful opportunity-as a Cornishman, the Minister will be delighted with that.

In market towns, high streets and small businesses in the wider area, broadband is crucial. However, in parts of my constituency, people can barely get half a megabit, and the best speed is about five or six megabits. We will look at speeds of 100 megabits in Cornwall. I do not know about Devonwall; we might even apply to join. Tremendous advantages can be conferred by broadband, and I urge the Minister to remember the Government's commitment.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op): On that important point, is the hon. and learned Gentleman aware that more than half of small businesses rely on the internet for up to 50% of their annual turnover? It is crucial for the Government to bear that in mind.

Mr Cox: We can join across the House in the nicest possible way and agree that that is a critical issue for small businesses, not only in the high street but in the rural areas that I represent and in cities and towns across the country. It is a particularly important issue in Torridge and West Devon, where the broadband service is poor. Across the border, however, there will be a wonderful broadband opportunity. We are committed to rolling out fast broadband by 2015, and I urge the Minister to accord that due priority. A combination of those things will make the difference to the high street.

My hon. Friend the Member for Northampton South, who is no longer in his place, recommended in the Conservative commission into small shops in the high street that we should look at a community hub enterprise area that brings together all partnerships and schemes under one simple banner, thereby enabling the Government to support them. I commend the recommendations of that 2008 commission to the Minister. I humorously referred to him as a white knight, riding out in support of the high street. In his response, I hope that he will make it clear that that is what he intends to be.

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