The phrase “standing up for hard-working people” is already looking like one of those terrible buzzwords for the next General Election.
Latest to use it was the Department for Communities and Local Government, describing Eric Pickles’ big thumbs-down to what he described as “lazy plans” by Derby Council, and 19 other authorities, to slap an 8.5% large stores levy – or “Tesco tax” – on stores with a rateable value of more than £500,000.
If the Derby scheme had been given the go ahead, and extended nationwide, it could have ended up costing retailers an estimated £400m. Pickles was right to place the proposals in a special jar marked ‘danger to economic health’. After all, this is a model already tried and rejected by the Scottish government and it’s as regressive as policies get.
“Rather than waging class war on business, councils would be better using their existing powers to support local high streets, such as calling off municipal parking bullies and backing local street markets,” said Mr Pickles.
Well said, one might say. Yet Pickles’ intervention still smacks of spin. This bid to align the government with the common man only leaves a sour taste in the mouth of the thousands of retailers crying out for help from the government at the moment.
With business rates poised to increase by 2.3% in 2015/16 after the Office for National Statistics released its RPI inflation figures last month, and nearly 7,000 retail businesses having waited more than four years for their day in Court to appeal against their rates charges, the government certainly hasn’t done much to stand up for hard-pressed shopkeepers.
The extent to which retail carries the burden of the outdated rates system can be shown on tables produced for The Grocer by business rates expert Paul Turner-Mitchell. The numbers clearly show that it is retailers big and small in the firing line; this is not an issue that should split the two sides.
The BRC this week wrote to George Osborne in the hope the government will make a “statement of intent” that it plans to tackle the burden of the rates system in the next parliament in the forthcoming Autumn Statement.
Unfortunately, despite all the rhetoric about being on the side of the people, hopes aren’t high that the coalition will promise any concrete action. Rejecting ill thought-out plans for a Tesco tax, which never stood much chance of getting off the ground, is one thing; actually doing anything substantive to tackle an unfair system crippling thousands of businesses is another.
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