William Eichler 08 May 2019

Whitehall ‘unwilling’ to help the high street, committee says

The Government is ‘unwilling’ to give high streets a ‘fighting chance’ in the battle with online retailers, a select committee has concluded.

A report published by the Ministry of Housing, Communities and Local Government in February concluded that business rates were ‘stacking the odds’ against high street retailers.

It urged Whitehall to initiate reforms to provide relief to high street retailers, including giving consideration to proposals for an online sales tax to level the playing field.

In their response to the report, the Government said that such changes would be ‘extremely challenging’.

‘Most of the reforms suggested by the committee go beyond the current business rates system,’ they said.

‘They would require significant time to consider, consult, legislate, and build the IT and other systems required for implementation and to communicate the changes to business and to the public.

‘Therefore, it would be extremely challenging to introduce them in the short term, or as extensions of the current business rates system.’

The committee chair Clive Betts said he was disappointed by the Government’s response which showed they were ‘unwilling’ to make the ‘radical’ changes necessary to help high street shops.

‘The Government has too readily decided to stick to the status quo, rather than examining the range of radical options to the taxation system that we propose in order to save the high street which it simply dismisses as too challenging,’ he said.

Mr Betts also registered his disappointment at the Government’s rejection of the committee’s recommendation to pause permitted development rights.

The committee urged Whitehall to empower councils to intervene more to support their local high streets. Local Plans, it said, were a key element of this.

However, the report warned that permitted development rights – a national grant of planning permission which bypasses local planning authorities – undermine these plans.

The Government responded by defending PDRs.

‘Permitted development rights make a valuable contribution to supporting development, by simplifying the planning process and reducing the matters that local planning authorities have to consider,’ they said.

‘They provide greater flexibility and freedoms to support our changing high streets and help businesses to adapt and diversify quickly to changes in consumer demands.’

Mr Betts said this was a ‘disappointing’ reply to his committee’s recommendation.

‘There is little point in empowering local authorities to develop plans that address the specific needs of their areas if they can be so easily circumvented,’ he said.

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