As the UK embraces a period of change after the Labour Party’s landslide victory, Retail Week takes a closer look at the new business and trade secretary, Jonathan Reynolds, and what the retail sector should expect from him.
After Labour’s landslide victory, the retail sector is hopeful for change from the new government. Business secretary Jonathan Reynolds has wasted no time in getting started, appearing on Sunday morning politics shows and voicing his opinions on the problems facing retail.
As we brace ourselves for big changes from the new Labour government, Retail Week looks at Jonathan Reynolds and what his tenure as business secretary could mean for the retail sector.
Reynolds on retail
Reynolds has been the Labour MP for Stalybridge and Hyde since 2010. Throughout his time as an MP, he has been very vocal about the state of the country’s high streets.
This will come as good news to retailers who have complained about how the retail sector, and its role in the economy more broadly, has been largely taken for granted by government.
Reynolds, in a column for Quest Media Network in September 2023, acknowledged that there are “clearly massive problems with high streets across the country” as he referred to the collapse of value giant Wilko.
He said: “Part of this comes down to a system of business rates which is just not fair when considered against the taxation of online transactions. Labour, nationally, is reviewing the whole system and believe significant change is required.”
In his speech unveiling Labour’s Plan for Small Business at the Essex Chamber of Commerce, Reynolds addressed the importance of the sector and the issues of “low investment, poor productivity, and low growth” that it faces.
He added: “I see my role as to listen, to engage, to communicate our plans clearly, and to try and solve problems – rather than cause them.”
So far, all of the above have echoed the views of retailers and the immediate needs of the sector. But Reynolds and his party have a long way to go when it comes to putting plans into action.
Keys to justice
Along with a new business secretary, the retail sector has also welcomed another cabinet appointment made last week by the new Labour government. James Timpson, chief executive of key cutter and shoe repair business Timpson since 2002, was announced as the government’s new minister for prisons, parole and probation.
The 52-year-old has developed a reputation for running his business with an “upside down” management style, placing its 5,600 employees in charge of the retailer. Timpson is also chair of the Prison Reform Trust and has hired hundreds of ex-offenders straight out of prison to give them a chance at building a new life for themselves.
AO chief executive John Roberts said of Timpson’s appointment: “This is one of the smartest appointments I’ve seen a politician make in a long time. Someone who actually knows the topic deeply, is incredibly capable, proven and most fundamentally, is a nice kind person. If this is a window into the new PM’s strategy, then there really may be genuine hope. Hat’s off for being brave and taking a different approach. Let’s now hope JT [James Timpson] gets empowered.”
What can retailers expect from Reynolds?
The retail sector has had a chequered history with the numerous business secretaries of the 14 years of Conservative government.
Retail’s response to the shortlived term of Kwasi Kwarteng as business secretary in 2021 was emblematic of the occasionally fractious relationship between the sector and then government. Sector representatives accused Kwarteng of being arrogant and “rude” towards the retailers in the room and dismissive of the issues they were raising.
It will be important for Reynolds to get off on a better footing.
Victoria Brownlie, chief of policy and sustainability at the British Beauty Council, says she has been encouraged by Reynolds’ “approach to business and willingness to listen”.
She expects Reynolds and his team to deliver “a number of key policies and ‘quick wins’ [for the sector] within the first 100 days.”
Helen Dickinson, chief executive of the BRC, says she has met Reynolds personally and welcomes his appointment to the brief responsible for the retail sector.
“We’ve had great engagement with Jonathan Reynolds and the rest of the Labour Business Team, which we plan to continue through this parliament,” she told Retail Week.
Both Dickinson and Brownlie are hopeful that Reynolds will address some of the sector’s other major policy concerns – not least the long-maligned business rates system and reforming the apprenticeship levy.
“We hope they will act on their manifesto commitments, including the reform of business rates and the apprenticeship levy, and taking steps to tackle retail crime through the introduction of a standalone offence for assaulting or abusing a retail worker,” says Dickinson.
Brownlie adds: “The Labour Party has made it clear that the current business rates system needs wholesale reform and a more level playing field when it comes to physical and ecommerce tax policy. They are also keen to review whether the current skills and education offering is fit for purpose for a modern workforce and if mechanisms such as the Apprenticeship Levy give businesses the flexibility to offer the opportunities it was originally set out to do.”
Reynolds is also getting his teeth stuck into some of the wider issues facing the sector.
With rumours of Shein potentially choosing a London stock market float facing a backlash from human rights groups, and wider questions over its business practices, Reynolds has already thrown down a gauntlet to the Chinese fast fashion giant, saying it would be expected to meet “ethical and moral targets [on] all business aspects”.
Reynolds will also play a huge role in the future of The Royal Mail. Its parent company, International Distribution Services, agreed a £5bn takeover with Czech billionaire Daniel Křetínský’s EP group last month, raising concerns about the potential damage to the service under private ownership.
Amanda Fergusson, chief executive of Greetings Card Association which represents more than 500 card businesses, says she expects Reynolds and the Labour Party to stand up to the promises it made to Royal Mail in its manifesto.
Fergusson said: “We look forward to working with Jonathan Reynolds and his BEIS team when it’s in place. He’s been very clear that he understands the importance of Royal Mail to small businesses and consumers alike. While there is much to do, our expectation is that the new government will be open to making sure the Royal Mail service is affordable, reliable and above all, remains national.”
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