High street failure due to government being “tied up with Brexit”

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Brexit

UK high streets are seeing a significant decrease in footfall because the government is too involved with Brexit to support properties, according to an industry lobby group.

British Property Federation boss Melanie Leech told the Press Association that the government was failing to tackle business rates because it “has been tied up with Brexit and there’s very little headspace for these important domestic issues”.

“Business rates is a huge issue, and the Chancellor announced in the Budget measures to help smaller retailers,” she said.

“But that’s not going to be enough to tackle the fundamental problems because it’s the big retailers and big players that are the major employers and wealth generators.”

England’s retailers with a rateable value of £51,000 or less will see a significant reduction in costs under plans to cut their business rates under Philip Hammond’s reforms.

The government believes this will amount to an annual saving of £8000 for 90 per cent of all independent shops, restaurants, pubs and cafes.

Meanwhile, Leech said that without reform for big retailers, there will come a point when a large firm will no longer be able to “bear this cost” and it will become “unsustainable” to continue trading.

Retailers such as Superdry, Sports Direct and Bonmarche have warned over profits in the past week, and online fashion retailer Asos has also been involved recently.

Christmas is usually a busy trading period for retailers, although this year the sector witnessed a steady decrease in footfall.

“Government ought to be concerned as it’s dampening economic activity. The business rates system is broken,” Leech said.

“To get our high streets at the top of the political agenda, and to give them the attention they deserve, we need more clarity around Brexit sooner rather than later.”

High streets minister Jake Berry said: “The government recognises the challenges facing high streets driven by changing consumer behaviour.

“That is why we have created a £675 million fund to help high streets adapt and slashed business rates by a third for the majority of smaller businesses.”

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3 COMMENTS

  1. The chancellor has given nothing more than a promised drink of water to a dying man on the street only to return 6 months later with a drink and to find him dead ! The high street needs help and fast before it is too late! It’s sadly dying, the longer the government bury there heads the harder it will be to bring back to life . Rates is a huge issue it’s out dated and doesn’t make any logical sense anymore . So very sad that they chose to do nothing

  2. The obsession with rates is unhelpful. Of course it would be better for the system to be reformed and made less punitive, but over time it is quite self-regulatory: rents and rates will decline as demand declines. Its already happening, and the government has been quite decisive in cutting charges, albeit in a most unsubtle manner.

    The problems of town centres are more deep-rooted, and if they are to thrive again then they need to change by making themselves more attractive destinations. This means improving public realm and transport links, but above all the provision of adequate car parking capacity with very low charges.

    • An interesting argument. I agree that improved transport links and improved car parking with low changes are a way to encourage visitors particularly if there is an attractive place to go at the end of it. Unfortunately the business rates that car park operators are required to pay within Cities, far out way the possibility of cheaper car park tariff’s. Who pays the business rates if the car park isn’t self funding? It comes back to business rates unfortunately.

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