Covid-19: Financial Support for High Street Retailers

Question

Asked by

To ask Her Majesty’s Government what additional financial support they plan to provide to high street retailers affected by the restrictions in place to address the COVID-19 pandemic.

My Lords, we have abolished business rates for high street retailers for 12 months as part of the Government’s support during the pandemic and have extended the moratorium on commercial landlords’ right to forfeiture for non-payment of rent. The Chancellor has announced the next phase in the Government’s plan to protect jobs and support businesses, including a new job support scheme and greater flexibility to help pay back loans.

I thank the Minister for his reply and, of course, I welcome the additional support the Chancellor announced last week and the business rates holiday, which has been a lifeline for so many businesses. However, that holiday is due to come to an end in April and without it, I fear more retailers will go under, resulting in yet more store closures and job losses. We have already lost 14,000 stores this year and 125,000 retail staff have lost their jobs. Will the Government extend the business rates holiday for a further year and think again about their recent decision to end the VAT retail export scheme, which the CEBR estimates will result in at least another 27,000 people losing their jobs in the retail sector?

I know that my noble friend has great expertise in this sector. As set out in the call for evidence for the fundamental review of business rates, of which he will be aware, the Government anticipate setting out our preliminary conclusions from the review in the most pressing areas, including reliefs, in the autumn.

My Lords, does the Minister agree that Covid has exacerbated a problem that existed some time before the pandemic, that high street retailers face higher costs and taxes than internet suppliers and that this will continue long after the Government’s short-term measures cease? Does the Minister agree that we need a permanent solution unless we want to see our high streets permanently damaged?

I did not quite catch all of that question, but I understand what the noble Lord was saying about the difficulty the retail sector is experiencing. Of course, the pandemic has exacerbated what has been a long-term problem, so I agree with the noble Lord to that extent.

My Lords, given the remarkable achievements of the high street retail sector in adapting to very difficult circumstances this year, can my noble friend say what steps the Government and the retail sector are taking to ensure that shops are safe for customers to visit in the run-up to Christmas?

The Government have worked closely with retailers throughout the pandemic and we continue to do so. Retailers were instrumental in the development of the Covid-secure guidance and we have invested a great deal to ensure that their premises are Covid secure. I welcome the British Retail Consortium’s campaign to encourage consumers to “Shop early, start wrapping, enjoy Christmas”.

My Lords, I remind the House of my registered interests. Footfall in high streets is down by well over a third compared to a year ago and despite business rates retail reliefs, the collection of business rates overall this financial year is still forecast to be down by more than £1.5 billion. Do the Government have a plan to meet this deficit without penalising the high street?

As I set out earlier, we will be announcing a review of the business rates system shortly but we have a number of other elements in place, which I outlined in answering the first questioner, to support the high street during this difficult time.

My Lords, does my noble friend agree that the serious demise of the high street was evident long before Covid hit, through a combination of the success of out-of-town shopping centres and the trend for shopping online? We really should have been thinking about things of this nature many years ago. Does he also agree that it is vital that we rethink the role the high street must play post Covid, especially in rural towns, where it has always been a major part of the social structure of those communities?

I agree with my noble friend that the retail sector has been undergoing a period of transition that well predates the pandemic. High streets play a crucial part in our rural communities, and through the £3.6 billion Towns Fund and the High Street Task Force we are providing support to local businesses and high streets.

My Lords, does the Minister agree that it is difficult to separate the original Question from questions about the longer term at a time, for example, when the current vulnerability coincides with changes to planning regulations? How much importance will be attached to the recent LSE report, Saving the High Street: The Community Takeover, and does its message that close local authority involvement with community-driven projects is central to the future of our town centres have the Government’s support?

The noble Lord is quite right. We welcome the report prepared for Power to Change, which provides some valuable insights that will inform future policy interventions to support the recovery of the high street and town centres. This is a difficult, ongoing problem and we will want to work closely with both local authorities and retailers to solve it.

My Lords, will the Minister ask colleagues in the Welsh Assembly whether the distinction between buying essential and inessential retail goods is a scientific one or an arbitrary political one? For retail in general, beyond financial support, a dangerous dose of puritan moralism will not help shops if it means that a care worker who has worked long shifts and might want to treat themselves to a dress is now treated as a criminal. The Minister said to shop early for Christmas—not in Wales, where I am from, because you are not allowed to shop at all, apparently.