BRC chief executive Helen Dickinson reports back from the recent Labour Party conference, which brought an opportunity for retail to influence the decision makers of the next five years on key issues such as business rates and crime
For a party that won over 400 seats at a general election, the mood at the Labour conference in Liverpool was a tad subdued. While the tone of speeches was upbeat, we didn’t learn much more than was in Labour’s manifesto and it’s clear just how pivotal the Budget will be.
It also didn’t help that the party entered the conference under fire for gifts from donors. The chancellor’s warnings of a painful Budget ahead and the announcement of winter fuel payment cuts limited any post-election boost. This was reflected in our new Consumer Sentiment Monitor with a 13-point drop in expectations about the state of the economy.
Still, my colleagues and I headed to Liverpool to call on them to #BuyIntoRetail – shining a light on the industry’s contribution to the economy, society and the environment – and how retail’s scale and reach can help the government achieve its goals.
“We shared our research into business tax which shows that retail (and hospitality) has the highest business tax burden”
We ran two successful events. Our #BuyIntoRetail reception brought together MPs, retailers and policymakers. I was joined on stage by our new retail minister Gareth Thomas, who outlined issues the government has committed to fixing: reforming business rates and the apprenticeship levy, tackling retail crime, and easing trade friction.
Sainsbury’s chief executive Simon Roberts highlighted the vital role of retail, from the 5.7 million jobs it supports to the £100bn it contributes to the economy every year.
Alignment with the new government – a good start. We certainly welcome the commitment to fixing some of the perennial issues getting in the way of retailers serving your customers. Now it’s all about government turning words into actions, turning these commitments into policies and getting the policies done right.
Given how many chief executives write to me about it, it’ll be little surprise that the fringe panel event we ran was on business rates. Entitled “Encouraging growth through business rates reform”, we shared our research into business tax which shows that retail (and hospitality) has the highest business tax burden compared to any other business sector.
“Retail pays 7.4% of business taxes (£33bn), compared to its share of the overall economy (5% of GDP)”
The session was introduced by Exchequer secretary James Murray, chaired by The Sun’s business editor Ashley Armstrong, and with a panel of Jo Whitfield (Matalan chief executive), Nick Stowe (Adena Brands chief executive), Giles Wilkes (Flint Global) and yours truly.
James Murray outlined Labour’s manifesto commitment to level the playing field on business rates. This fits neatly with the BRC’s call for a ‘retail rates corrector – a 20% downward adjustment in business rates paid on retail properties, aimed at balancing a situation where retail pays 7.4% of business taxes (£33bn), compared to its share of the overall economy (5% of GDP).
This £33bn translates into the joint highest proportion of pre-tax profits of any industry, alongside hospitality. This burden has contributed to the loss of 6,000 shops over the past five years, with estimates suggesting another 17,000 in the next decade without action.
While Labour has been clear that the reformed rates system must raise the same amount of money, panellists were quick to note that the government should be looking outside retail if it is to shift the burden away from shops and high streets.
The Labour conference also provided a wider opportunity to meet decision makers of the next five years. And not just those in parliament: I spoke at both the Usdaw event as they launched their new plan for the future of retail, and the thinktank panel, alongside Demos, on future high street policy.
“The commitments have been made, now it’s all about turning them into policies and getting the policies done right”
Conferences are a golden opportunity to build on existing relationships and forge new ones. We’ll be following up on those connections over the coming weeks, including an event we’re holding in parliament on October 29 to showcase the industry.
All eyes now turn to the Budget on October 30; we wait to see if there is meaningful action on rates. October also marks the publication of plans for the new industrial strategy, a business tax roadmap and insights into spending and plans around important bills, such as on employment, crime and justice and skills.
We are not putting all our eggs in one basket. The BRC also attended the Lib Dem and Conservative conferences as we build cross-party coalitions to #BuyIntoRetail – ensuring the necessary scrutiny of Labour’s plans. Why? Because it’s all about delivery now. The commitments have been made, now it’s all about turning them into policies and getting the policies done right. The harder work begins.
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