Pressure group the British Retail Consortium (BRC) is today calling on the Government to restore consumer confidence by controlling costs imposed on British households as new data reveals the “severe and long lasting” impact of the banking collapse.
Coinciding with the fourth anniversary of the Lehman Brothers collapse which prompted the global banking crisis, the BRC revealed that retail sales growth now averages half of what is was prior to the collapse of the American bank while year-on-year growth in total value retail sales has averaged 2.1 per cent in the last two years.
As a result of this figure being below inflation, retail sales have stagnated while like-for-like sales have been close to zero for the same period.
Consumer confidence has improved little in recent times, remaining at -29 for the third consecutive month, falling considerably below expectations following the London Olympic Games.
UK economic output remains four per cent below its peak prior to the recession, which has worsened in recent months as falling consumer spending led to a double-dip recession and the ongoing economic turmoil has forced consumer confidence to remain close to record lows seen in 2008 following the crisis.
Commenting on the figures Stephen Robertson, Director General of the BRC, said: “Four years on from this key event in the banking crisis, which sent retail sales plummeting, sales growth is still less than half what it was before.
“Sales volumes are now going backwards. Representing over five per cent of GDP and more than 10 per cent of jobs, retail is a vital part of the UK economy and a key indicator of its health.
“Retail is fundamentally resilient. It’s still the biggest private sector employer in the country but this analysis vividly demonstrates the lasting blow dealt to households and to retail sales by the crisis of 2008.”
The BRC has unveiled its findings to coincide with the start of the party political conference season and attacks policies by Chancellor George Osborne, stating that fuel duty rises which had initially been anticipated to be introduced last month must be abandoned altogether.
Robertson concluded: “Any successful economic fight back needs a return to strength for the retail sector.
“It’s not enough just to talk about growth. We need the Government to rebuild confidence, support customers and retailers and get spending going again by holding back the costs it is responsible for.
“Scrapping the postponed fuel duty rise, now due in January, and freezing Business rates next year are top of my list.”