Supporting High Streets

I inform the House that I have selected the amendment in the name of the Prime Minister.

I beg to move,

That this House calls on the Government to support high streets by cutting public expenditure to facilitate the abolition of business rates for thousands of retail, hospitality and leisure premises on the high street; and further calls on the Government not to proceed with the Employment Rights Bill to avoid hiring freezes and job losses, to remove red tape for businesses, including by reviewing IR35, to cut energy bills for businesses and to tackle retail crime, thereby protecting key pillars of local communities including post offices, pubs and pharmacies.

I am pleased to move the motion in my name and that of the Leader of the Opposition. We celebrate and support our high streets—their independent shops, the warm refuge they provide from loneliness, and the way that they incubate new business. They bring us together as communities, provide markets for local farmers and food producers, offer venues for street festivals and often afford young people their first step on the career ladder, but across Britain’s high streets, the lights are dimming, the laughter in our pubs is falling silent, and shutters on shops are coming down for the last time. When high streets thrive, communities thrive. When our high streets retreat, so does civic society. We Conservatives profoundly value our high street enterprises, which is why one of our first actions in government will be to abolish business rates for thousands of retail, hospitality and leisure businesses.

In July, the Chancellor said that she will make the UK

“the best place to start and grow a business”.—[Official Report, 29 July 2024; Vol. 752, c. 1051.]

Well, goodness me, she has an odd way of showing it! In her very first Budget, the Chancellor slapped businesses with a £25 billion tax raid, and with a national insurance jobs tax, which hit high-street businesses the hardest, and meant that it cost business owners more simply to give someone a job.

Hospitality was hit particularly hard by that toxic concoction. A UKHospitality survey found that 76% of businesses put up their prices, one third restricted their hours and 63% had to cut their staffing as a result. Is that not the reason why we need this policy to try to improve our high streets?

My hon. Friend makes exactly the right point: it was a devastating concoction of the Chancellor’s last year, and I believe that I am right in saying that UKHospitality calibrated the figures and estimated that 98,000 jobs have been lost across the hospitality sector. How proud this Government must be of costing mostly young and often vulnerable people their first chance!

My hon. Friend is giving a powerful speech. Hospitality is fundamental to social mobility. I would have thought that Government Members would be ashamed of a policy that means that those furthest away from the labour market—young people—are put off from trying to get their first job. Hospitality is essential to enabling them to join the labour market, and the Government have put blocks in the way of people who want a better life.

My right hon. Friend is exactly right. Let us be optimistic: we are here to celebrate our high streets, and perhaps all is not lost. The Chancellor could yet repent and reverse some of her most damaging policies, or adopt our policy of cutting business rates entirely for 250,000 high-street businesses.

When I visited Salisbury chamber of commerce on Friday, it gave me the example of a single mother doing 30 hours a week on the national living wage. As a result of the combination of the increase in the national living wage, the threshold changes and the rate changes on national insurance, that individual costs a business 11% more than they did last year. As a consequence, they cannot take on anyone else. What does my hon. Friend think about the impact that has on the economy?

My right hon. Friend represents his constituents in Salisbury diligently, and makes exactly the same point. With respect, the Government have not understood business, and the Treasury did not pause to consider, or to conduct an impact assessment. In particular, the capricious change in thresholds from £9,100 down to £5,000, without any impact assessment from the Treasury, has done immense damage to high-street businesses. The Government should hang their head in shame.

My hon. Friend will know that cafés, including small cafés, play an important part on the high street and bring people to it. Is he aware that under this Government, mushrooms are up, bacon is up, eggs are up, sausages are up, bread is up, tea is up and milk is up? Therein is a threat to the full English breakfast. This Government might be forgiven for many things, but taking away the full English breakfast from the high street is not one of them.

I enjoy a full English as much as I suspect my colleague does. It is not just breakfast that is under threat; it is also lunch, supper, tea, dinner and the great British pub.

I thank the shadow Secretary of State for bringing this debate forward, and I welcome it. I am always constructive and encouraging, so let me say that Ards and North Down borough council, my local council back home, has a scheme for a new, thriving high street. A council grant enables shop owners to repaint their premises, provide new signage and address the blight of vacant shops. Online shopping without investment means that the high street cannot survive. Does he agree that the Government should extend the initiative that we have back home in Northern Ireland, in my council area, to councils here, to help with jobs and rebuilding the high street?

I agree with the hon. Gentleman. There is so much that we in this House and those in the Government—if they are minded to do so—can do to alleviate the burden on business. It is hard to run a business at the best of times, and it is even harder when the Government seek to be a headwind, rather than a tailwind.

Will the hon. Member give way?

I have so many wonderful contributions to take from my colleagues. I am sure that the hon. Gentleman will have his chance later.

One thing that the Government might like to reflect on is the perverse situation that people facing VAT find themselves in. The £90,000 threshold is causing many small business people, such as barbers, to adjust their behaviour—classically, reducing their working week from five days to four or three. Does my hon. Friend agree that the Treasury needs to look at the increased tax take that it might receive if it changed VAT thresholds to allow those small businesses to work full time?

My right hon. Friend makes another excellent point. I recently had the wonderful opportunity to meet Dr Arthur Laffer, whose pioneering economic research showed that reducing taxes increased not only the growth rate of the economy but, as a consequence, the tax take to the Treasury. That is a very important point about incentives and what we in this House can do.

The hon. Member is speaking about the tax rate. Is it not also important to talk about the tax gap? That gap is £46.8 billion, of which £6.4 billion is linked to tax evasion. We are seeing a lot of that on our high streets up and down the country. What does he think should be done across Government to tackle it?