High Street Businesses: Government Support

In the east of my constituency, Wallingford is the smallest of the three towns, but more than makes up for that with its history, which goes back to Anglo-Saxon times. Its town centre high streets have a range of small businesses, full of character, such as the independent Wallingford Bookshop and Le Clos, a wine bar also offering amazing food, including tarte flambée with a range of toppings—baked flatbreads originating in the Alsace region of France. A key challenge for an ancient town is how to accommodate car traffic and parking to maintain visitor levels, given the large towns and cities fairly nearby. There is also frustration in Wallingford that NHS criteria seemingly prevent more than one pharmacy being able to serve the town.

Finally, Wantage is the second largest town in my constituency and the birthplace of King Alfred. In Wantage, the great Market Place is lined with independent shops, cafés and restaurants, with a retail park in the town centre, too. Wantage’s Argos store has been shut for two years, and New Look has now closed its doors as well, so vacant premises are a concern and many existing businesses highlight the crippling impact of significantly increased business rates—including the Vaults bar and pizza restaurant, the Kings Arms pub and the Bear Hotel, the last of which reports a doubling of its business rate charges. Consultation and debate are ongoing about how to further improve Wantage Market Place, which is dominated by car parking and bus stops. Special events that see Market Place closed to traffic, including the annual Dickensian evening, are popular and see the place filled with visitors.

The three towns, and their high street businesses, have three themes at the heart of their challenges and concerns, the first of which is the growing burden of business taxation and costs. Local businesses are feeling hammered by rising costs and barriers to their growth and hiring people; they feel there is an unfair playing field, given that online businesses are not taxed in the same ways and to the same degree. They feel that business rates are a flawed tax that is not directly related to either income or profit. Businesses in my constituency feel that recent Government changes to business rates have done little to ease the difficult situations they face, and certainly fall well short of the radicalism that was at least implied in Labour’s 2024 manifesto.

The second key theme is transport and access, which is a key challenge as a result of population growth and central Government housing targets. A growing amount of car traffic, competing for a constrained amount of car parking in town centres, creates real challenges, particularly in older towns such as Wallingford. That is why the reality is that more must be done to help those who can, and would like to, walk and cycle by providing them with safer and better options for doing so. For example, cycle parking can reassure them that their bicycle will be safe.

At this point, I should say that when we get into a debate about transport, it is often presented as an either/or between cars and public transport, walking and cycling. However, those things are not mutually exclusive. The Netherlands does not just have a globally leading cycling infrastructure and culture; it has the most comprehensive motorway in Europe, as well as a fully electrified mainline railway network. Public transport, walking and cycling are complementary to cars—we need both. Even small increases in the use rates of public transport, walking and cycling can help to ease congestion and free up parking spaces for those who need them.

Investment in roads, pavements and general town centre infrastructure is also a concern. Poorly maintained pavements can be a barrier for older residents and those with mobility issues, increasing the risk of falls and discouraging visits to the town centre. Improving accessibility would help to attract more visitors and support local businesses.

The third theme is local government funding pressures. Of course, many small businesses in my constituency, entirely understandably, look to local councils to help them with their high street and business challenges. I want to explain why local councils are too affected by central Government policy and face reduced budgets amidst growing costs.

With their origins in European Union funding streams, South Oxfordshire and Vale of White Horse district councils have, until now, benefited from allocations from two funds: the UK shared prosperity fund and the rural England prosperity fund. Between them, those funding streams have supported more than 130 local projects across the councils so far. Projects were hugely varied, but they included grants to support businesses and community groups with a transition to more efficient and affordable energy use—pubs and cafés, for example. They also included providing capital investment into equipment that supports productivity gains, funding a huge range of business and skills support programmes, often targeting those most at need; developing a visitor economy support programme to support our market towns; and making several small-scale improvements to the public realm across the two districts.

Unfortunately, this Labour Government have decided to scrap those funds, and their replacements, Pride in Place and the local growth fund, are principally targeted at city regions and areas of high deprivation. The impact of the abolition of the two funds is not trivial. In 2025-26, the allocations from the two funds across the Vale of White Horse and South Oxfordshire districts were £1 million; in 2024-25, the total was £2.4 million. At the same time, changes to local government funding formulae mean that Oxfordshire county council will lose £24 million in funding over the next three years.

Those changes affect all three councils’ abilities to invest in high streets and support local businesses. They also make it harder for them to explore new ideas, such the ones requested by the town councils of the three towns I mentioned: grants to town and parish councils to invest in civic pride, such as floral planting, hanging baskets, more street cleaning and more ways to promote local shopping; or funding to employ town centre managers to link the town council with retail centres and independent traders.

I want to set out my key asks of central Government. Once again, the Government need to go much further in reforming business rates—a form of taxation that bears little resemblance to a business’s earnings. Does the Minister recognise that evidence submitted to Alan Milburn’s interim report into young people not in education, employment or training identified labour costs as a key concern? The Government, to their credit, have announced serious intentions in relation to energy prices, but what should be done in the meantime, particularly with no sign—very sadly—of war in the middle east abating?

Once again, will the Minister heed Liberal Democrat calls for a 5% cut to VAT for hospitality? Does he agree that taxation arrangements need modernisation, given the rising threat to physical businesses posed by online retail? Given rising demand and the same amount of space for car parking, do the Government agree that greater investment in public transport and walking and cycling infrastructure is needed to make it easier for people who need to drive to have the road space and car parking to do so?

What fresh, new ideas do the Government have to help our high streets? I have a few examples to consider. National “buy local” schemes would incentivise and reward people for spending their money locally. A “high streets back home” scheme would give people a clear route to invest in their own community, whether by restoring heritage building, supporting local enterprise or helping to secure community assets. The Government could give councils the power to designate independent shop zones, protecting and championing small locally owned businesses against the tide of chains and empty units.

Does the Minister accept that, for councils not benefiting from Pride in Place funding, including in Oxfordshire, the end of the UK shared prosperity and rural England prosperity funds constitute a cut to local government funding? That undermines their ability to invest in staff and initiatives to help small businesses improve town centres, and to award grants to businesses and community organisations to help them reduce their energy bills or upgrade their equipment. Our high streets and local businesses are critical to the successes of our towns and surrounding communities, and I call on the Government to give them the support that they deserve.

The all-party parliamentary group on anti-corruption and responsible tax, which I chair, has spent the past year speaking to individuals on the frontline with responsibility for tackling the explosion of cash-intensive businesses. Representatives from the banking sector told me that they hold significant data on suspicious cash flows but lack the legal architecture to share it usefully. Legitimate hard-working barbers being driven out by criminal operators told me that their trade is being tarnished in plain sight. Officials in local government told me that they watch shops close one week and reopen the next under a new name and a new nominee director, with the unpaid business rates simply written off.

The NCA’s Operation Machinize has shown what is possible. In my constituency, Horwich Mini Market on Lee Lane was closed for three months last year after the seizure of almost 20,000 illegal cigarettes, hundreds of illegal vapes and 7 kg of illegal tobacco. The nearby Texaco service station on Chorley New Road was prosecuted in December 2024—the first prosecution of its kind in the north-west of England—with more than 7,000 illegal vapes seized across four visits. But let us be honest: Operation Machinize has visited more than 2,500 premises across two waves, and its initial wave produced only 10 permanent closures—that is 10 out of 2,500 businesses. Organised crime will absorb that figure as an operating cost and shrug it off by the end of the week.

After years of austerity and inaction under successive Governments, I know that this Government understand the severity of the situation facing our country. Measures announced include a new £30 million high street organised crime unit, which I was proud to lobby the Chancellor for before last year’s Budget, and 75 new officers in the worst-affected regions, including the north-west of England. Trading Standards will receive £6 million, after a decade of cuts that halved its capacity.

Other measures include a new cross-Government taskforce, 350 new His Majesty’s Revenue and Customs investigators, a new abusive phoenixism taskforce and a consultation on extending closure orders. All that shows real progress, and the APPG that I chair has campaigned hard for many of those measures, so it would be remiss of me not to thank the Minister and his colleagues across Government for their work over the last two years.

But money alone will not finish the job. The criminals hollowing out all our communities have to know that they are no longer welcome, and that must mean three things. First, we should adopt a British equivalent to the Dutch Bibob regime. The officials in the port city of Rotterdam I met earlier this year told me how they have spent 14 years dismantling the organised criminal infrastructure that we are struggling against in the UK. Dutch officials in one Rotterdam suburb told me how their integrity screening regime reduced the number of firms from 111 to 65 without recourse to a single criminal prosecution, removing suspicious businesses en masse. We should learn from our Dutch counterparts and give our local authorities similar powers to refuse permits to applicants linked to criminal intelligence and to look through nominee directors for the real money behind them.

Secondly, we should move to mandatory licensing for barbers, vape shops and the other high-risk sectors that have become criminal franchises in plain sight on our high streets. If someone needs a licence to sell a pint of beer, someone should need one to open a barber shop or a vape store.

Thirdly, we should extend closure powers so that persistent offenders are shut down for good. Members of the Chartered Trading Standards Institute overwhelmingly back the idea: 98% support extending closure orders and 97% support permanent closure for repeat offenders. And let us remove, in a single line of legislation, the absurd £1,000 cash seizure threshold that lets criminals wave goodbye to trading standards officers with fistfuls of notes in their hands. Let officers seize every pound of ill-gotten gains from the till.

Our high streets are where this country lives. They bind our communities together and they are where the next generation of British entrepreneurs will cut their teeth. Businesses like Hive, Serendipity and Blackedge Brewery are proof that there is still enormous pride, creativity and resilience in our towns. They are worth fighting for, so let us do so.

As an increasing number of shoppers use contactless payments, businesses are suffering, with increased amounts of their revenues going to payment providers. Shops processing £10,000 a week in card payments are paying around £13,000 a year in fees, and there has been a big increase in credit card payments. The Government have no say in that, but could contact be made with credit card companies to ensure that they drive down their charges? That might help a bit. To put that figure into perspective, it could cover several months of rent or the salary of a part-time staff member. These costs are one of the reasons why high street businesses are not employing new staff—they have to cut back somewhere.

Crime and antisocial behaviour leave high street firms facing extra expenses for security measures, insurance, replacing stolen or damaged stock, getting CCTV and establishing contact systems with local police. Larger retailers are not unaffected, with retailers such as Claire’s Accessories, Poundland and River Island announcing closures. Even charity shops such as Cancer Research UK are on the list.

Large banks are also affected, the impact of which cannot be overlooked, as their branches act as an anchor, driving foot traffic to surrounding high street shops. Eleven banks have closed in my constituency. We have been able to get banking hubs to fill in the gaps, and there are post offices in nearly every Spar shop down the Ards peninsula, so there are ways of addressing this. Fewer people are visiting town centres, leading to high street decline. The combination of higher running costs and less disposable income has led to more and more vacant premises.

A considerable factor in this decline is the rise of online shopping, which again relates to the people’s habits. It poses a particular concern to smaller enterprises, which are unsupported when it comes to e-commerce and accessing the necessary technology. Consumers should be encouraged to consider the fact that online shopping cannot replace the experience of face-to-face contact with retailers and the opportunity to see, touch and assess products themselves.

We are very fortunate in Newtownards, the main shopping town in my Strangford constituency, to still have many family shops—I think of Knotts, Wardens and many clothes shops that are family firms as well. Consumers’ ability to make more informed choices will contribute to the creation of a more loyal and consistent customer base for our high street shops. Retail parks and larger shopping centres have fewer economic pressures because they have the car parks. Sometimes the car parks in towns charge fees, which by their very nature create issues.

In conclusion, I endorse all the recommendations made by the hon. Member for Didcot and Wantage. There are some really good ideas that would help each and every one of us, including our constituents. The Government’s aim should be to create a more resilient high street that can survive as well as thrive long term. We look to the Minister so that the high street can be supported for our customers and shopkeepers.

Progressive announcements in the Budget included increased resources for trading standards officers— I feel I am repeating things that my hon. Friend the Member for Bolton West (Phil Brickell) mentioned, but it is worth reinforcing. Budget announcements also included the creation of a dedicated cross-Government taskforce to develop an intelligence-led understanding of organised crime on our high streets; the deployment of 350 newly recruited criminal investigators in HMRC’s fraud investigation service; and the recruitment of 50 additional Insolvency Service staff through a new abusive phoenixism taskforce. These are important and welcome interventions, and they would not have happened if not for my hon. Friend and the APPG he so ably leads.

Under the Tobacco and Vapes Act 2026, the Government are introducing a licensing scheme for retailers selling tobacco and vape products, helping to strengthen enforcement and improve accountability across the sector. Most recently the Home Office announced a £30 million enforcement blitz to target organised crime gangs that exploit UK high streets, sending a clear signal that the Government understand both the scale of the challenge and the need for co-ordinated action.

All that will come as very welcome news to residents in communities such as mine in Great Grimsby and Cleethorpes, because local people are absolutely fed up with seeing their high streets abused. They are frustrated when they see businesses apparently operating outside the law, while honest traders who pay their taxes, employ local people and contribute to their communities in many different ways are expected to compete on an uneven playing field.

However, if we are to achieve the tangible change that communities want to see, the Government must go further and faster. Speed matters because, while we discuss these issues in Westminster and in rooms like this, more of these businesses continue to appear on our high streets. They pop up every single day. Every month that passes without visible enforcement undermines confidence in the rule of law and leaves legitimate businesses feeling completely abandoned.

If this is a Government priority, as I believe it is, we must consider how to encourage more local authorities to move the issue higher up their agendas. Many councils face severe pressures on resources and capacity, but tackling high street criminality cannot be viewed as an optional extra. It must be recognised as central to economic regeneration and community safety. We must continue to reinforce the message that these enterprises are not simply untidy retail operations or minor breaches of regulations: organised criminality, tax evasion, exploitation and fraud lie behind many of them. Frankly, their presence drags down shopping areas, deters investment and damages public confidence.

The prize for getting this issue right is enormous. Economically thriving high streets support local jobs, encourage investment and help small businesses to succeed. Socially, they provide communities with places that they can be proud of, and morally, they help to restore faith that the rules apply equally to everyone. In too many towns across the country people feel left behind, ignored and increasingly sceptical that the law is being enforced fairly. Pulling high streets away from criminal exploitation offers an opportunity not only to revitalise local economies but to rebuild trust. That is why I welcome the progress the Government have already made, but urge Ministers to maintain the pace, strengthen enforcement and ensure that communities finally see the change they have been waiting for.

Online shopping is a major contributing factor. By failing to enact sensible reform of the business rates system, successive Governments have failed to address the unfair advantage enjoyed by online retailers. Increasingly, high streets are filled with things that one cannot get online, but even here, Government policies are failing responsible employers. Take the hair and beauty sector as an example. The first Headmasters salon opened in Wimbledon village more than 40 years ago. Across the sector, the number of apprenticeships dropped from 16,000 to 6,000 between 2016 and 2023 because of a VAT regime that incentivised salons to use self-employed staff rather than to grow and develop their own talent.

However, my constituency is doing better than many parts of the country. Footfall in Wimbledon town centre is rising, and Wimbledon village was recently named the UK’s top neighbourhood high street. However, the same is not true of Morden town centre, most of which has been part of the Wimbledon constituency since the 1980s.

Morden town centre was once a go-to destination. I am a south Londoner, even though my parents were both cockneys, because my mother came to Morden from Hackney one day in the 1940s to attend a Sunday Pictorial film stars garden party—as a fan, not as a celebrity, I hasten to add—in nearby Morden Hall park. She was enraptured by the thriving art deco high street that she encountered and decided on that day that she wanted to live in south London.

Sadly, Morden town centre has been in decline for many decades, despite Merton’s Labour council promising, for at least the last 30 years, to rejuvenate it. The council’s latest plans have now been put on hold till the end of the decade. Sadly, nothing is happening. I thank the Minister’s colleague—the former Parliamentary Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for Nottingham North and Kimberley (Alex Norris)—for meeting me to help to move things forward, although sadly Merton council declined to attend that meeting.

Nationally, the Liberal Democrats are offering concrete solutions. We would cut VAT for hospitality from 20% to 15%, which a study from the Night Time Industry Association shows would pay for itself by increasing sales and VAT revenue. We would reform business rates to reward occupancy and community value, while agreeing a youth mobility scheme with the EU to resume the flow of young, eager Europeans keen to work in hospitality in their gap years. We would also reform the apprenticeship levy so that our hair salons and other small businesses are incentivised to develop talent. Our high streets need urgent help. Too many shops have put the “closed” sign up for the last time. I look forward to hearing how the Minister is proposing to reverse that trend.

High street businesses give life to the heart of a community. Independent traders, entrepreneurs and innovators give a place its identity. Pubs, bars, coffee shops, community hubs, restaurants and the rest provide the social space for a town to come together and connect, rather than us remaining atomised in our private lives. These are the businesses that so often offer those first, defining jobs for young adults, and where staff build genuine connections with local customers, keeping an eye out for the elderly and vulnerable if they need a bit of assistance. In short, the success of our high street businesses is essential for a healthy, happy society. We are very fortunate in North East Hertfordshire to have many fantastic high street businesses, including G’s Deli, Vutie Beets and the Uniform Monkeys in Letchworth, the Cheese Plate in Buntingford, Bow Books in Royston and Café Luna in Baldock, to name just a few.

There is no denying that our high street businesses are under enormous pressure, and we must take immediate, decisive action to help them. I ask the Minister to look at the following priorities as a matter of urgency. First, energy bills are crippling our high street businesses. They need support just as much as domestic users but have none of the protections, and that must change. Secondly, the business rates system is manifestly unfair and a huge burden. Frankly, the Byzantine complexity of the whole edifice is mind-boggling. We cannot keep debating discounts, transitional support and multipliers. In the manifesto that this Government was elected on, Labour—my party—promised to abolish business rates and replace them with a fairer, more transparent system. We must deliver on that promise now.

I urge the Minister to ensure that, as we deliver reform, we not only remove the loopholes that allow huge corporations to practically choose how much tax they pay while independent businesses play by the rules, but shift the burden of taxation away from high streets, which give so much to our communities, and balance that with a fairer share being paid by online sales giants.

Finally, we have to recognise that, to create the environment for thriving high street businesses, we need to reverse the huge damage done to our local councils by the years of austerity under previous Administrations. Only with properly funded councils will local democracy have the power to take back control of empty shops and give commercial opportunities to a wider range of retailers and local entrepreneurs, rather than the endless parade of vape and betting shops that too often seem to be the preference of absentee private landlords.

What is more, properly funded councils are essential for tackling the scourge of overflowing bins, littered streets and crumbling roads, which do such a disservice to our high streets when it comes to attracting people. We need councils that are able to make more than a merely financial decision about the cost of parking around our high streets, and that can take a more creative approach to the differing needs of small market towns such as Buntingford and large towns such as Bishop’s Stortford down the road.

To conclude, supporting our high streets is essential for spreading genuine prosperity across every part of our country. I hope to hear from the Minister today about more decisive action to achieve just that.

A local wine merchant in Kings Langley, who provides white labelling for multiple retailers, is really struggling. They said that extended producer responsibility cost them an additional £240,000 in its first year of being introduced, and new bureaucratic regulation cost £15,000 to manage and adhere to, with an overcomplicated application. It feels like death by a thousand cuts for these businesses. It is affecting decisions to invest in those businesses, which in normal times would be increasingly successful.

Hubs, a franchise owner in my constituency, said that his national insurance contributions alone increased by £138,000 from April to September, and he expects the figure to be £275,000 in the full first-year cycle. Mark, the Rickmansworth Waitrose branch manager, said there has been a 45% increase in wages in the last five years, and NICs are costing Waitrose millions. If a huge high street giant like Waitrose is suffering to this level, how can a small independent retailer of whatever type survive?

My plea to the Minister, for whom I have the utmost respect, is to think twice about the burdens we are putting on businesses. Local councils can help, for example by not introducing parking charges for short stays. That would encourage footfall. We saw the upside of strong communities and high streets during the pandemic, where it was typically the retailers who knew their customers inside out who could identify where particular elements of our communities were suffering and proactively reach out to them. My worry is that if we continue with the drive towards online shopping— I am as guilty as anyone else—we will lose the face of our high streets, and the soft power relationship between retailers and the clients and consumers they serve.