Andrew Vine: Government must not let online giants annihilate our high streets

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WHAT might our high streets look like in a decade’s time? Bustling with shoppers and street entertainment, or a wasteland of derelict properties?

That’s the crystal-ball gazing that the Housing, Communities and Local Government Select Committee will attempt today, when it considers what town centres will be like in 2030.

Technology has changed our shopping habits.

Technology has changed our shopping habits.

It could hardly come against a less promising backdrop. The Yorkshire-based menswear chain, Greenwoods, collapsed after being in business since 1860 and HMV is in administration, possibly destined to go the same way.

Trading figures from Marks and Spencer, John Lewis and Debenhams are due this week. They are unlikely to dispel a sense of gloom about traditional retailing. If they show Christmas was not as bad as had been feared, that will be regarded as good news.

But although survival in the face of an online onslaught is to be welcomed, it does not disguise the fact that high streets are under greater threat than ever before. The days when Christmas meant a bonanza for the shops, and going into them was an ordeal because they were so busy increasingly feels like a bygone era.

A week before Christmas, I found it unsettling to walk into the Leeds city centre branch of House of Fraser and find that the number of staff exceeded those of the customers.

If the select committee wanted a sobering example of what is happening to traditional shopping streets, they could do worse than visit Bradford.

Walk uphill from the Town Hall towards the indoor market, and streets that were once full of people are quiet because so many shops are shut. In some places, the empty properties outnumber those still in business. This is what town and city centres all over Yorkshire might look like by 2030 if there isn’t urgent action to level the playing field between high streets and online competitors.

One of those before the select committee today is the Northern Powerhouse Minister, Jake Berry, who has antagonised councils by suggesting that they have the power to revitalise high streets by introducing free parking.

It’s typical of this Government to pass the buck. Mr Berry should acknowledge that the decline of the high street is not a local issue, but a matter of national importance that needs to be addressed centrally.

He should also have the honesty to admit that the Government’s £675m to boost town and city centres, announced in last autumn’s budget, is a pittance when spread across the whole country.

It’s the worst sort of gesture politics, a sum that initially sounds impressive, but when looked at again is utterly inadequate.

Warm words from Mr Berry about how concerned he is are not enough.

There needs to be action, support for bricks-and-mortar businesses, a complete rethink on the level of business rates and tax paid by the high streets and online retailers.

Free parking isn’t an answer in itself.

Nobody will go into a town or city centre where there are few shops left, even if they don’t have to pay to park.

The boss of House of Fraser and Sports Direct, Mike Ashley, is not an appealing figure, but he spoke sense when he appeared before the select committee last year and called for a 20 per cent tax on online sales. It’s going to take that sort of radical action to give high streets a fighting chance.

In particular, the paltry amount of tax paid by Amazon compared with retailers who have shops with all the overheads they entail, needs to be addressed.

The Government cannot stand by and let faceless online giants, with their ultra-creative accounting that enables profits to be moved legally around the world to minimise tax liabilities, annihilate our high streets.

Jobs have already gone as a result of the Greenwoods collapse, more may follow at HMV, and if the big names reporting figures this week are feeling the pinch, that could well result in further staff being put out of work.

Councils are doing all they can to keep town and city centres in business, but there are limits to what they can do.

They have neither the money nor the powers to make a decisive difference on their own.

For both economic and social reasons, the Government must act.

The Conservatives are supposedly the party of business, yet it is on their watch that the changing nature of shopping is consigning household names to oblivion and staff to unemployment while they do nothing about it.

Nor it is acceptable for the Government to stand by as if helpless while shopping streets are hollowed out not because of any failing on the part of the businesses that once traded there, but because they face unfair competition.

The retail world is changing, and it is the duty of Government to ensure that its policies keep pace with those changes, and in doing so give high streets a future.